GOD REWARDS ABOUNDING CARE AND EDUCATIONAL SOCIETY, MEERUT V. ITO, EXEMPTION, GHAZIABAD

ITA 3875/DEL/2017

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 5370 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 7 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-01-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2013-2014
• Appeal Filed On: 15-06-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Opportunity of being heard; Principle of natural justice
• Section: 271(1)(c); 143(3); 12A; 12AA; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCHES (CAMP AT MEERUT) BEFORE SHRI N.S. SAINI, ACCOUNTANT MEMBER AND SHRI KULDIP SINGH, JUDICIAL MEMBER ITA NO.3874/DEL./2017 (ASSESSMENT YEAR : 2013-14) ITA NO.3875/DEL./2017 (ASSESSMENT YEAR : 2013-14) M/S. GOD REWARDS ABOUNDING CARE VS. ITO, AND EDUCATIONAL SOCIETY, WARD EXEMPTION, C/O SHRI VINOD KUMAR GOEL, GHAZIABAD. 282, BOUNDRY ROAD, CIVIL LINES, MEERUT. (PAN : AAAAG4789P) (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI VINOD KUMAR GOEL, ADVOCATE REVENUE BY : SHRI S.S. RANA, CIT DR SHRI MUNSHI RAM BIHAGRA, SENIOR DR DATE OF HEARING : 08.01.2019 DATE OF ORDER : 29.01.2019 O R D E R PER KULDIP SINGH, JUDICIAL MEMBER : SINCE COMMON QUESTIONS OF FACTS AND LAW HAVE BEEN R AISED IN BOTH THE AFORESAID APPEALS, THE SAME ARE BEING D ISPOSED OFF BY WAY OF CONSOLIDATED ORDER TO AVOID REPETITION OF DI SCUSSION. 2. THE APPELLANT, M/S. GOD REWARDS ABOUNDING CARE A ND EDUCATIONAL SOCIETY (HEREINAFTER REFERRED TO AS TH E ASSESSEE) BY ITA NO.3874 & 3875/DEL./2017 2 FILING THE PRESENT APPEALS I.E. IN ITA NO.3874/DEL/ 2017, SOUGHT TO SET ASIDE THE IMPUGNED ORDER DATED 05.06.2017 AND I N ITA NO.3875/DEL/2017 SOUGHT TO SET ASIDE THE IMPUGNED O RDER DATED 06.06.2017 BY CONFIRMING THE PENALTY ORDER DATED 26 .09.2016 PASSED U/S 271(1)(C) OF THE INCOME-TAX ACT, 1961 (F OR SHORT THE ACT), BY LD. CIT (APPEALS), MEERUT QUA THE ASSESSM ENT YEAR 2013- 14 ON THE GROUNDS INTER ALIA THAT :- ITA NO.3874/DEL/2017 1. THAT DONATION RECEIVED FROM EX MEMBERS OF THE BOARD AND OTHERS OF RS.6,22,250/- CANNOT BE TREATED AS ANONYMOUS DONATION, WHEN COMPLETE DETAILS OF DONATION WAS PROVIDED TO CIT(A). THEREFORE, THE AO AS WELL AS CIT(A) IS IN ERROR IN ASSESSING THE DONATIO N ANONYMOUS AND TAXED U/S 115BBC OF LT. ACT @ 30%. 2. THAT AS PER AO. ORDER, HE ALLOWED ONLY SALARY TO STAFF BUT OTHER CHARITABLE ACTIVITIES HE TOTALLY IG NORED THEREFORE, THE ASSESSMENT MADE BY AO. BY DISALLOWIN G EXPENSES EXCEPT SALARY TO STAFF IS AGAINST THE PRIN CIPAL OF NATURAL JUSTICE. PARTICULARLY, WHEN THE TRUST IS REGISTERED UNDER SOCIETY ACT AS WELL AS U/S 12A OF LT. ACT AND CIT(A) IGNORED THE SAME. ITA NO.3875/DEL/2017 1. THAT THE PENALTY OF RS.1,62,000/- IMPOSED BY A.O . AND CONFIRMED BY CIT(A) IS BAD IN LAW BECAUSE THE A .O. AS WELL AS CIT(A) HAS NOT ALLOWED THE BENEFIT OF SE CTION 11 (5) OF I.T. ACT. HENCE, IMPOSITION OF PENALTY AN D CONFIRMED THE SAME IS BAD IN LAW. 2. THAT THE A.O. IN HIS PENALTY ORDER HAS NOT BRING ANYTHING EXCEPT THE VARIOUS EXPRESSION IN ASSESSMEN T ORDER HOWEVER, PENALTY PROCEEDING ARE DIFFERENT FRO M ITA NO.3874 & 3875/DEL./2017 3 THE ASSESSMENT PROCEEDING AND A.O. ALSO IGNORED THA T THE ASSESSMENT WAS NOT SERVED UPON THE ASSESSEE. HENCE, PENALTY IMPOSED BY A.O. WITHOUT PROVIDING PROPER AND REASONABLE OPPORTUNITY IS BAD IN LAW AND CIT(A) ALSO IN ERROR IN CONFIRMING THE SAME. 3. THAT THE LD. CIT(A) HAS NOT CONSIDER THE WRITTEN REPLY OF THE ASSESSEE AS WELL AS VARIOUS CASE LAWS QUOTED BY THE ASSESSEE. THEREFORE, CONFIRMATION OF PENALTY IS AGAINST THE FACTS AND AGAINST THE PRINCIPLE OF NATU RAL JUSTICE. 3. BRIEFLY STATED THE FACTS NECESSARY FOR ADJUDICAT ION OF THE CONTROVERSY AT HAND ARE : ASSESSEE SOCIETY REGISTER ED UNDER SOCIETY REGISTRATION ACT HAS ALSO BEEN REGISTERED UNDER SEC TION 12AA OF THE INCOME-TAX ACT, 1961 (FOR SHORT THE ACT). AS SESSING OFFICER NOTICING DONATION OF RS.6,22,250/- FROM 92 PERSONS CALLED UPON THE ASSESSEE TO FURNISH DETAILS OF DONORS WITH NAMES, A DDRESSES, PAN AND BANK DETAILS TO PROVE CREDITWORTHINESS OF THE D ONORS WHICH THE ASSESSEE HAS FAILED TO PRODUCE AND CONSEQUENTLY PRO CEEDED TO TREAT THE DONATION OF RS.5,22,250/- AS ANONYMOUS DONATION UNDER SECTION 115BBC OF THE ACT AND CHARGED THE SAME TO TAX. AO HAS ALSO SOUGHT TO INITIATE PENALTY PROCEEDINGS UNDER SECTIO N 271(1)(C) OF THE ACT AGAINST THE ASSESSEE ON THE GROUND THAT THE ASSESSEE HAS CONCEALED THE INCOME BY FURNISHING INACCURATE PARTI CULARS OF INCOME. ITA NO.3874 & 3875/DEL./2017 4 4. ASSESSEE CARRIED THE MATTER BY WAY OF APPEALS BE FORE THE LD. CIT (APPEALS) WHO HAS DISMISSED BOTH THE APPEALS. FEELING AGGRIEVED, THE ASSESSEE HAS COME UP BEFORE THE TRIB UNAL BY WAY OF FILING THE PRESENT APPEALS. 5. WE HAVE HEARD THE LD. AUTHORIZED REPRESENTATIVES OF THE PARTIES TO THE APPEAL, GONE THROUGH THE DOCUMENTS R ELIED UPON AND ORDERS PASSED BY THE REVENUE AUTHORITIES BELOW IN T HE LIGHT OF THE FACTS AND CIRCUMSTANCES OF THE CASE. 6. FOR THE SAKE OF BREVITY, THE FINDINGS RETURNED B Y THE LD. CIT (A) ARE EXTRACTED AS UNDER :- I HAVE GONE THROUGH THE FACTS OF THE CASE AND THE SUBMISSIONS OF THE LD.AR AND CONSIDERED THE LEGAL ASPECT THAT ARISES OUT OF THE FACTS OF THE CASE. IN THE ASSESSMENT ORDER THE AO HAS STATED THAT DESPITE SEV ERAL OPPORTUNITIES, THE CONCERNED AR NEVER PRODUCED THE BOOKS OF ACCOUNT AND VOUCHERS. ULTIMATELY THE AR DURING ASSESSMENT PRODUCED A COPY OF THE FIR DATED 4.03.2016 FILED IN THE POLICE STATION THAT HAVE FAL LEN ANYWHERE. IT IS TO BE NOTED THAT THE SAID ASSESSMEN T HAS BEEN FRAMED UNDER SECTION 143(3) OF THE ACT. NOW IN THE APPEAL PROCEEDINGS THE LD. AR HAS FILED CERTAIN DOCUMENTS ALONGWITH WRITTEN SUBMISSIONS WHICH HAVE BEEN REPRODUCED ON PAGE 4 & 5 OF THIS ORDER HOWEVER NO APPLICATION UNDER RULE 46A OF THE I.T RULES HAS BEEN FILED ALONGWITH THESE SUBMISSIONS. ALSO, NO EVIDENCE HAS BEEN FILED THAT THE PAPERS NOW BEING F ILED WERE FILED BEFORE THE AO. UNDER THESE CIRCUMSTANCES I AM NOT IN A POSITION TO ADMIT THE EVIDENCES FILED N OW IN THE ABSENCE OF EITHER THE DETAILS THAT WERE FILED B EFORE THE AO OR THE NEW EVIDENCE WHICH SHOULD HAVE COME WITH A PROPER APPLICATION UNDER RULE 46A, ESPECIALL Y FROM THE LD. COUNSEL WHO HAS A VAST EXPERIENCE OF DEALING WITH SUCH MATTERS IN APPEAL. BUT THE LAW IN THE ITA NO.3874 & 3875/DEL./2017 5 MATTER HAS NOT BEEN FOLLOWED, FOR REASONS BEST KNOW N TO THE LD. COUNSEL. UNDER THE CIRCUMSTANCES AND CONSIDERING THE LEGAL POSITION I AM NOT IN A POSITI ON TO INTERFERE IN THE ASSESSMENT ORDER FRAMED BY THE A.O . 7. BARE PERUSAL OF THE FINDINGS RETURNED BY THE LD. CIT (A) SHOW THAT WHEN UNDISPUTEDLY NO DOCUMENT HAS BEEN PR ODUCED BY THE ASSESSEE DURING THE ASSESSMENT PROCEEDINGS BEFO RE THE AO PARTICULARLY FIR DATED 04.03.2006 TO PROVE THE FACT THAT THE ASSESSEE HAS LOST THE DOCUMENTS SOMEWHERE AND THE A SSESSEE HAS SOUGHT TO PRODUCE THOSE DOCUMENTS DURING APPELLATE PROCEEDINGS WITHOUT MOVING AN APPLICATION UNDER RULE 46 OF THE INCOME-TAX RULES, 1962 AND CONSEQUENTLY, LD. CIT (A) HAS NOT P ROVIDED ADEQUATE OPPORTUNITY TO THE ASSESSEE TO PROVE THOSE DOCUMENTS. 8. WE ARE OF THE CONSIDERED VIEW THAT ASSESSEE SHOU LD NOT BE MADE TO SUFFER DUE TO NEGLIGENCE OR INEFFICIENCY ON THE PART OF THE IS AUTHORIZED REPRESENTATIVE WHO HAS NOT MOVED AN A PPLICATION UNDER RULE 46A OF THE RULES RATHER SOUGHT TO PROVE THE DOCUMENTS JUST LIKE THAT. SO, IN THESE CIRCUMSTANCES, ASSESSE E IS ENTITLED FOR ADEQUATE OPPORTUNITY OF PRODUCING THE DOCUMENTS AND WE DEEM IT FIT IN THE INTEREST OF JUSTICE TO SET ASIDE THE ASS ESSMENT ORDER TO THE FILE OF ASSESSING OFFICER WHO SHALL DECIDE AFRESH A FTER PROVIDING AN OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. CONSEQ UENTLY, APPEAL IN ITA NO.3874/DEL/2017 IS ALLOWED FOR STATISTICAL PURPOSES. ITA NO.3874 & 3875/DEL./2017 6 9. SINCE PENALTY PROCEEDINGS INITIATED UNDER SECTIO N 271(1)(C) AND CONSEQUENT PENALTY LEVIED ON THE ASSESSEE IS CO NSEQUENTIAL TO THE ASSESSMENT ORDER WHICH HAS SINCE BEEN SET ASIDE , PENALTY PROCEEDINGS ARE ALSO SET ASIDE TO THE AO WHO WILL D ECIDE AFRESH AFTER PASSING A FRESH ASSESSMENT ORDER. CONSEQUENTL Y, APPEAL IN ITA NO.3875/DEL/2017 FILED BY THE ASSESSEE IS ALLOW ED. 10. RESULTANTLY, BOTH THE APPEALS FILED BY THE ASSE SSEE ARE ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN OPEN COURT ON THIS 29 TH DAY OF JANUARY, 2019. SD/- SD/- (N.S. SAINI) (KULDIP SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED THE 29 TH DAY OF JANUARY , 2019 TS COPY FORWARDED TO: 1.APPELLANT 2.RESPONDENT 3.CIT 4.CIT(A), GHAZIABAD. 5.CIT(ITAT), NEW DELHI. AR, ITAT NEW DELHI.