The I.T.O.-4(4), Agra V. SSt. Andrews Public School Society, Agra

ITA 390/AGR/2010

• Counselvise Citation: 39020314 RSA 2010
• Duration Of Justice: 1 year(s) 1 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-10-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 14-10-2011
• Assessment Year: 2005-2006
• Appeal Filed On: 17-09-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: SHRI
• Keywords: Rejection of books of accounts; Unexplained investment; Income from undisclosed sources; Charitable institution; Additional evidence; Valuation report
• Section: 142(1); 133A; 153A; 12AA; 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AGRA BENCH, AGRA BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER AND SHRI B.C. MEENA, ACCOUNTANT MEMBER ITA NOS.388, 389 & 390/AGR/2010 ASSESSMENT YEARS: 2003-04, 2004-05 & 2005-06 RESPE CTIVELY INCOME TAX OFFICER-4(4), VS. ST. ANDREWS PUBLIC SCHOOL SOCIETY, AGRA. SHARMA BANDHU ESTATE, BALKESHWAR RAOAD, AGRA (PAN: AAFTS 1064 B). (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI WASEEM ARSHAD, SR. D.R. RESPONDENT BY : SHRI ASHWANI TANEJA, FCA, DR. RAKESH GUPTA, ADVOCATE & SHRI SHASHANK AGARWAL, ADVOCATE DATE OF HEARING : 14.10.2011 DATE OF PRONOUNCEMENT : 18.10.2011 ORDER PER H.S. SIDHU, J.M. : THE REVENUE HAS FILED THE AFORESAID APPEALS AGAINST THE DIFFERENT IMPUGNED ORDERS DATED 22.06.2010 PASSED BY THE LD. CIT(A)-II , AGRA FOR THE ASSESSMENT YEARS 2003-04, 2004-05 & 2005-06 RESPECTIVELY. ITA NOS.388, 389 & 390/AGR/2010 A.YS. 2003-04, 2004-05 & 2005-06 2 2. SINCE THE ISSUES INVOLVED AND THE GROUNDS RAISED IN ALL THE AFORESAID APPEALS BY THE REVENUE ARE IDENTICAL, EXCEPT FOR AMOUNTS IN DISPUTE, THEREFORE, ALL THESE APPEALS ARE DISPOSED OF BY THIS CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE. 3. THE GROUNDS RAISED BY THE REVENUE IN ITA NO.389/ AGR/2010 FOR THE ASSESSMENT YEAR 2006-07 READ AS UNDER :- 1. THAT THE LD. CIT(A) HAS ERRED IN LAW AND ON FAC TS IN HOLDING THAT THE ASSESSING OFFICER DID NOT HOLD JURISDICTIO N U/S 153A READ WITH SECTION 153C IGNORING THE FACT THAT THE PERSON SEAR CHED WAS DIRECTLY CONNECTED TO THE ASSESSEE AND DOCUMENTS FOUND IN TH E PREMISES SEARCHED WERE RELATING TO THE ASSESSEE SOCIETY. 2. THAT THE LD. CIT(A) HAS ERRED IN LAW AND ON FACT S IN HOLDING THAT ORDER UNDER SECTION 153A TO BE VOID IGNORING T HE FACT THAT ASSESSING OFFICER WAS HAVING PROPER JURISDICTION IN VIEW OF FACT THAT THE PERSON SEARCHED WAS DIRECTLY CONNECTED TO THE A SSESSEE AND DOCUMENTS FOUND IN THE PREMISES SEARCHED WERE RELAT ING TO THE ASSESSEE SOCIETY. 3. THAT THE LD. CIT(A) HAS ERRED IN LAW AND ON FACT S IN ALLOWING EXEMPTION U/S 10(23C)(IIIAD) TO THE ASSESSEE IGNORI NG THE FACT THAT ASSESSEE SOCIETY WAS BEING RUN FOR PROFIT MOTIVE AN D APPLICATION UNDER SECTION 12AA WAS REJECTED BY THE JURISDICTIONAL CIT . 4. THAT THE LD. CIT(A) HAS ERRED IN LAW AND ON FACT S IN NOT SUSTAINING REJECTION OF BOOKS OF ACCOUNT BY THE ASS ESSING OFFICER IGNORING THE FACT THAT ASSESSEE COULD NOT JUSTIFY EXPENSES FOR WHICH HAND-MADE VOUCHERS WERE MAINTAINED AND HEAVY EXPENS ES ON A/C OF SALARY, CAR AND OTHER FACILITIES PROVIDED TO THE PE RSONS CONNECTED TO THE SOCIETY. ITA NOS.388, 389 & 390/AGR/2010 A.YS. 2003-04, 2004-05 & 2005-06 3 5. THAT THE LD. CIT(A) HAS ERRED IN LAW AND ON FACT S IN DELETING THE ADDITION OF ` 2 LACS MADE BY THE ASSESSING OFFICER BY DISALLOWING THE EXPENSES CLAIMED BY THE ASSESSEE IGNORING THE FACT THAT THE ASSESSEE COULD NOT JUSTIFY EXPENSES WHICH WERE CLAIMED ON TH E BASIS OF SELF MADE VOUCHERS AND WERE MANAGED ACCORDING TO THE REQ UIREMENT OF FUNDS FOR INVESTMENT. 6. THAT THE LD. CIT(A) HAS ERRED IN LAW AND ON FACT S IN DELETING THE ADDITION OF ` 17,12,419/- MADE BY THE ASSESSING OFFICER AS INCOME FROM UNDISCLOSED SOURCES ON A/C OF DIFFERENCE FOUND BETWEEN THE INVESTMENT SHOWN AND THE ESTIMATE MADE BY THE VALUA TION OFFICER ACCEPTING THE ADDITIONAL EVIDENCE IN THE SHAPE OF D VOS REPORT DATED 29.08.2007, COMMENTS BY THE ASSESSEE, COMMENTS BY T HE DVO AND COUNTER COMMENTS BY THE ASSESSEE AND IGNORING THE F ACT THAT THE PROVISIONS OF THE SECTION 10(23C)(VI) WERE NOT APPL ICABLE IN ASSESSEES CASE AND THERE WAS UNDER VALUATION ON TH E PART OF THE ASSESSEE AS PER THE VALUATION DONE BY THE VALUATION OFFICER AT THE TIME OF SURVEY. 7. THAT THE ORDER OF LEARNED CIT(A) BEING ERRONEOUS IN LAW AND ON FACTS DESERVES TO BE QUASHED AND THAT THE ORDER OF THE A.O. TO BE RESTORED. 8. THE APPELLANT CRAVES LEAVE TO ADD OR ALTER ANY O R MORE GROUND OR GROUNDS OF APPEAL AS MAY BE DEEMED FIT AT THE TI ME OF HEARING OF APPEAL. 4. THE BRIEF FACTS RELATING TO THE ISSUE IN DISPUTE IN RESPECT OF ITA NO.389/AGR/2010 ARE THAT A SEARCH UNDER SECTION 132 (1) OF THE INCOME TAX ACT, 1961 (THE ACT HEREINAFTER) WAS CONDUCTED AT THE R ESIDENTIAL PREMISES OF DR. GIRDHAR SHARMA, 5-6 SHIVAM ENCLAVE, BALKESHWAR, AGR A ON 16.09.2004 AND SOME CASH, JEWELLERY AND INCRIMINATING DOCUMENTS WERE FO UND. THE ASSESSING OFFICER ISSUED NOTICE TO THE ASSESSEE ASKING TO EXPLAIN THE DETAILS OF INCOME FOR THE ITA NOS.388, 389 & 390/AGR/2010 A.YS. 2003-04, 2004-05 & 2005-06 4 ASSESSMENT YEAR IN DISPUTE. THE ASSESSING OFFICER ALSO ISSUED NOTICE UNDER SECTION 143(2) AND 142(1) OF THE ACT TO THE ASSESSE E. IN RESPONSE TO THE SAME, THE LD. AUTHORISED REPRESENTATIVE OF THE ASSESSEE APPEA RED AND DISCUSSED THE MATTER WITH THE ASSESSING OFFICER. ON INVESTIGATION OF TH E DOCUMENTS, IT WAS GATHERED THAT SOME DOCUMENTS/BOOKS OF ACCOUNTS WERE RELATING TO THE ASSESSEE SOCIETY ST. ANDREWS PUBLIC SCHOOL SOCIETY, AGRA WHICH IS REGIST ERED WITH REGISTRAR OF SOCIETIES. THE SOCIETY WAS ESTABLISHED ON 28.10.19 87 AND WAS ENGAGED WITH THE MAIN OBJECT OF IMPARTING EDUCATION, CLAIMING TO BE A CHARITABLE INSTITUTION. AS THE PERSON SEARCHED WAS DIRECTLY CONNECTED TO THE ASSES SEE AND THE DOCUMENTS FOUND IN THE PREMISES SEARCHED WERE RELATING TO THE ASSESSEE , THE ASSESSMENT IN THIS CASE FOR THE YEAR UNDER CONSIDERATION WAS COMPLETED UNDER SE CTION 153A READ WITH SECTION 153C OF THE ACT VIDE ORDER DATED 29.12.2006. A SUR VEY UNDER SECTION 133A WAS CONDUCTED ON 16.09.2004 AT THE PREMISES OF THE ASSE SSEE SOCIETY AND SOME PRINTOUTS WERE TAKEN OUT BUT NO BOOKS OF ACCOUNTS W ERE FOUND AT THE PREMISES. DURING THE COURSE OF SURVEY, THE DEPARTMENTAL VALUA TION OFFICER (DVO) ESTIMATED THE INVESTMENT IN THE BUILDING OF ST. ANDREWS PUBLI C SCHOOL AT RS.2,50,00,000/-. ACCORDING TO THE REVENUE, THE ASSESSEE COULD NOT PR OVE THAT THE SOCIETY WAS RUNNING FOR SOLE OBJECTIVE OF IMPARTING EDUCATION A ND NOT EARNING THE PROFIT DURING THE YEAR UNDER CONSIDERATION AND ALSO FOUND THAT TH ERE ARE VARIATIONS IN THE EXPENSES ALSO. THEREFORE, THE ASSESSING OFFICER RE JECTED THE BOOKS OF ACCOUNTS OF ITA NOS.388, 389 & 390/AGR/2010 A.YS. 2003-04, 2004-05 & 2005-06 5 THE ASSESSEE AND DISALLOWED RS.2,00,000/- OUT OF EX PENSES CLAIMED AND ADDED THE SAME TO THE INCOME OF THE ASSESSEE. THE ASSESSEE F URNISHED A VALUATION REPORT, IN WHICH PERIOD OF CONSTRUCTION OF BUILDING OF ST. AND REWS PUBLIC SCHOOL IS FROM 1996-97 TO 2003-04 AND 2005-06 AND TOTAL INVESTMENT IS RS.1,22,71,151/-. DURING THE COURSE OF SURVEY, THE DVO ESTIMATED THE INVESTM ENT IN THE BUILDING OF ST. ANDREWS PUBLIC SCHOOL AT RS.2,50,000/-, WHEREAS, TH E ASSESSEE HAS DECLARED THE SAID INVESTMENT AT RS.96,56,015/-. THE MATTER WAS REFERRED TO THE DVO TO KNOW THE CORRECT ESTIMATED VALUE OF THE CONSTRUCTION. T HE REPORT OF THE DVO WAS NOT RECEIVED AND THE ASSESSMENT WAS GOING TO BE BARED B Y LIMITATION. THE ASSESSING OFFICER RELIED UPON THE VALUATION OF THE DVO DONE A T THE TIME OF SURVEY UNDER SECTION 133A OF THE ACT AND ADDED RS.17,12,419/- AS UNDISCLOSED INVESTMENT BEING THE DIFFERENCE BETWEEN THE INVESTMENT ESTIMATED BY THE DVO AT THE TIME OF SURVEY AND THE INVESTMENT SHOWN BY THE ASSESSEE IN THE SCH OOL BUILDING DURING THE YEAR UNDER CONSIDERATION AND THE ASSESSING OFFICER COMPU TED THE UNDISCLOSED INVESTMENT AND COMPLETED THE ASSESSMENT UNDER SECTI ON 153A OF THE ACT ON 29.12.2006. AGGRIEVED BY THE SAME, THE ASSESSEE FI LED APPEAL BEFORE THE LD. FIRST APPELLATE AUTHORITY WHO VIDE ORDER DATED 22.06.2010 PARTLY ALLOWED THE APPEAL OF THE ASSESSEE AND DELETED THE ADDITION IN DISPUTE. ITA NOS.388, 389 & 390/AGR/2010 A.YS. 2003-04, 2004-05 & 2005-06 6 5. AT THE TIME OF HEARING, THE LD. DEPARTMENTAL REP RESENTATIVE RELIED UPON THE ORDER PASSED BY THE ASSESSING OFFICER AND STATED TH AT THE LD. FIRST APPELLATE AUTHORITY HAS WRONGLY HELD THAT THE ASSESSING OFFIC ER HAS ASSUMED THE JURISDICTION UNDER SECTION 143A READ WITH SECTION 153C OF THE AC T WITHOUT ANY INCRIMINATING PAPERS SEIZED BY THE DEPARTMENT IN THE COURSE OF SE ARCH OF DR. GIRDHAR SHARMA AND WITHOUT ANY SPECIFIC REFERENCE TO THE ANNEXURE OF P ANCHNAMA AND HE HAS WRONGLY DECLARED THE ASSESSMENT AS VOID. HE FURTHER STATED THAT THE LD. FIRST APPELLATE AUTHORITY HAS WRONGLY ALLOWED THE EXEMPTION UNDER S ECTION 10(23C)(IIIAD) OF THE ACT TO THE ASSESSEE IGNORING THE FACTS THAT THE ASS ESSEE SOCIETY WAS BEING RUN FOR PROFIT MOTIVE AND APPLICATION UNDER SECTION 12AA WA S REJECTED BY THE LD. CIT(A). HE FURTHER STATED THAT THE LD. FIRST APPELLATE AUTH ORITY HAS WRONGLY DELETED THE ADDITION IN DISPUTE WITHOUT ANY EVIDENCE. THEREFORE , THE IMPUGNED ORDER MAY BE CANCELLED AND THE ASSESSMENT ORDER MAY BE UPHELD BY ACCEPTING THE APPEAL FILED BY THE REVENUE. 6. ON THE CONTRARY, THE LD. COUNSEL FOR THE ASSESSE E RELIED UPON THE ORDER PASSED BY THE LD. FIRST APPELLATE AUTHORITY. HE FURTHER S TATED THAT THE LD. FIRST APPELLATE AUTHORITY HAS RIGHTLY DECIDED THE ISSUES IN DISPUTE IN FAVOUR OF THE ASSESSEE BY APPRECIATING THE EVIDENCES PRODUCED BY THE ASSESSEE . HE STATED THAT THE ASSESSING OFFICER DID NOT HAVE ANYTHING WHICH COULD HAVE GIVE N THE VALID JURISDICTION TO HIM ITA NOS.388, 389 & 390/AGR/2010 A.YS. 2003-04, 2004-05 & 2005-06 7 UNDER SECTION 153C OF THE ACT. THE ASSESSING OFFIC ER HAS NOT MENTIONED AS TO WHICH DOCUMENTS OR BOOKS OF ACCOUNTS RELATING TO TH E ASSESSEE WAS DISCOVERED IN THE SEARCH AT THE PREMISES OF DR. GIRDHAR SHARMA AN D WHETHER THERE IS ANY UNDISCLOSED INCOME RESULTING FROM SUCH SEIZED DOCUM ENTS. HE STATED THAT THE JURISDICTION ASSUMED BY THE ASSESSING OFFICER UNDER SECTION 153C DURING SEARCH, THE ASSESSEE MAY BE HELD AS NON-SUBSISTING AND THE ASSESSMENT SO FRAMED MAY BE QUASHED. 7. AS REGARDS TO THE ISSUE INVOLVED IN GROUND NO.4, THE LD. COUNSEL FOR THE ASSESSEE STATED THAT THE ASSESSING OFFICER HAS REJE CTED THE CLAIM OF THE ASSESSEE MADE UNDER SECTION 10(23C)(IIIAD) ON THE GROUND THA T THE ASSESSEE SOCIETY DOES NOT EXIST FOR SOLELY FOR EDUCATIONAL PURPOSE. HE STATE D THAT IT IS WELL ESTABLISHED FROM THE STATEMENT OF ACCOUNTS OF THE SOCIETY FILED BEFO RE THE REVENUE AUTHORITIES THAT THE ASSESSEE SOCIETY IN THE PRECEDING YEARS ALSO HA S ENJOYED THE EXEMPTION UNDER SECTION 10(22) WHICH WAS ALWAYS GIVEN TO IT AS IT E XISTED SOLELY FOR EDUCATIONAL PURPOSE NOT INVOLVING PROFIT. THEREFORE, THE FINDI NG OF THE ASSESSING OFFICER IN REJECTING THE CLAIM OF THE ASSESSEE UNDER SECTION 1 0(23C)(IIIAD) WAS NOT IN ACCORDANCE WITH LAW AND THE LD. FIRST APPELLATE AUT HORITY HAS RIGHTLY APPRECIATED THE SAME AND HELD THAT THE ASSESSEES SOCIETY HAS E XISTED SOLELY FOR EDUCATIONAL PURPOSE NOT INVOLVING PROFIT, THE BENEFIT OF PROVIS IONS OF SECTION 10(23C)(IIIAD), ITA NOS.388, 389 & 390/AGR/2010 A.YS. 2003-04, 2004-05 & 2005-06 8 THEREFORE, CANNOT BE DENIED MERELY ON THE BASIS OF SUSPICION/PRESUMPTION OF ASSESSING OFFICER ESPECIALLY WHEN NO EVIDENCE OF AN Y PROFIT MOTIVE HAS BEEN POINTED OUT BY THE ASSESSING OFFICER NOR SAME HAS B EEN FOUND IN SEARCH. 8. THE LD. AUTHORISED REPRESENTATIVE RELIED UPON TH E ORDER OF LD. FIRST APPELLATE AUTHORITY. HE FURTHER STATED THAT REJECT ION OF REGISTRATION UNDER SECTION 12AA HAS GOT NO BEARING ON THE ISSUE AT HAND BUT FI NALLY REGISTRATION UNDER SECTION 12AA WAS GRANTED TO THE ASSESSEE FOR ASSESSMENT YEA R 2005-06 BY THE COMMISSIONER OF INCOME TAX (CENTRAL), KANPUR W.E.F. 01.04.2004 VIDE ORDER DATED 15.12.2009. HE FURTHER STATED THAT THE ASSESSING O FFICER HAS WRONGLY REJECTED THE BOOKS OF ACCOUNTS WITHOUT ANY BASIS AND MADE THE AD HOC ADDITION OF RS.2,00,000/- WHICH IS NOT SUSTAINABLE IN THE EYES OF LAW BUT THE LD. FIRST APPELLATE AUTHORITY HAS RIGHTLY DELETED THE SAME BY HOLDING THAT THERE IS NOTHING ON RECORD REGARDING EXPENSES WHICH HAVE BEEN FOUND AS OF INADMISSIBLE N ATURE NOR ANY EVIDENCE TO SHOW THAT SUCH EXPENSES WERE NOT INCURRED BUT FALSE LY CLAIMED OR INCURRED FOR THE PURPOSE OTHER THAN EDUCATION. THEREFORE, THE ADHOC DISALLOWANCE WITHOUT POINTING OUT THE REASON CANNOT BE APPRECIATED AND THE ADDITI ON OF RS.2,00,000/- HAS RIGHTLY BEEN DELETED BY THE LD. FIRST APPELLATE AUTHORITY. HE RELIED UPON THE FINDING OF THE LD. FIRST APPELLATE AUTHORITY ON THIS ISSUE. ITA NOS.388, 389 & 390/AGR/2010 A.YS. 2003-04, 2004-05 & 2005-06 9 9. AS REGARDS TO THE ADDITION OF RS.17,12,419/- AND RS.6,00,000/- RESPECTIVELY MADE BY THE ASSESSING OFFICER FOR THE ASSESSMENT YE ARS 2003-04, 2004-05 & 2005-06 AS UNEXPLAINED INVESTMENT IN THE SCHOOL BUI LDING, HE RELIED UPON THE FINDING GIVEN BY THE LD. FIRST APPELLATE AUTHORITY ON THE ISSUE IN DISPUTE. HE STATED THAT WHEN THE ASSESSEE HAS GOT EXEMPTION UND ER SECTION 10(23C)(IIIAD) OF THE ACT, NO ADDITION CAN BE MADE IN THE CASE OF THE ASS ESSEE. IN SUPPORT OF HIS CONTENTION, HE CITED THE DECISION OF DELHI BENCH IN THE CASE OF RISHIKESH PUBLIC SCHOOL AND IN THE CASE OF ITO VS. VIRENDRA SINGH ME MORIAL SHIKSHA SAMITI, 118 ITD 382. FINALLY, THE LD. COUNSEL FOR THE ASSESSEE STATED THAT THE IMPUGNED ADDITION DESERVES TO BE DELETED BECAUSE ONCE CLAIM UNDER SECTION 10(23C)(IIIAD) IS GRANTED AS THE ENTIRE INCOME IN THAT CASE WOULD BE EXEMPT AS WAS HELD BY DELHI BENCH IN THE CASE OF RISHIKESH PUBLIC SCHOOL AND IN THE CASE OF ITO VS. VIRENDRA SINGH MEMORIAL SHIKSHA SAMITI, 118 ITD 382. HE REQ UESTED THAT THE APPEAL FILED BY THE REVENUE MAY BE DISMISSED. 10. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE RELEVANT RECORDS AVAILABLE WITH US. WE ARE OF THE CONSIDERED OPINION THAT THE LD. FIRST APPELLATE AUTHORITY HAS RIGHTLY DECIDED THE ISSUE OF JURISDICTION OF AS SESSING OFFICER UNDER SECTION 153A READ WITH SECTION 153C OF THE ACT. WE FIND TH AT NO INTERFERENCE IS CALLED FOR IN THE IMPUGNED ORDER ON THIS ISSUE AND WE UPHOLD T HE SAME. ITA NOS.388, 389 & 390/AGR/2010 A.YS. 2003-04, 2004-05 & 2005-06 10 11. AS REGARDS TO THE EXEMPTION UNDER SECTION 10(23 C)(IIIAD) ALLOWED TO THE ASSESSEE BY THE LD. FIRST APPELLATE AUTHORITY, WE A RE OF THE VIEW THAT THERE IS NO DISPUTE THAT ASSESSEE IS AN EDUCATIONAL INSTITUTION AND IS IMPARTING EDUCATION WHICH IS ITS MAIN OBJECT. THE ASSESSING OFFICER HAS WRON GLY GIVEN HIS FINDING THAT THE ASSESSEE SOCIETY IS NOT EXISTING SOLELY FOR EDUCATI ONAL PURPOSE. WE FIND THAT THE ASSESSING OFFICER HAS GIVEN THIS FINDING WITHOUT AN Y EVIDENCE BUT THE LD. FIRST APPELLATE AUTHORITY HAS RIGHTLY HELD THAT DURING TH E COURSE OF SEARCH UNDER SECTION 132(1) NO SUCH PAPERS OR EVIDENCE HAS BEEN FOUND FR OM ANY OF THE PREMISES FROM WHICH IT COULD BE INFERRED THAT THE EDUCATIONAL INS TITUTION RUN BY THE ASSESSEE IS NOT EXISTING SOLELY FOR EDUCATIONAL PURPOSE. THE LD. F IRST APPELLATE AUTHORITY HAS ALLOWED THE BENEFIT TO THE ASSESSEE AFTER APPRECIAT ING THE EVIDENCES FILED BY THE ASSESSEE BEFORE THE ASSESSING OFFICER AS WELL AS BE FORE HIM. IT IS ALSO NOT DISPUTED THAT GROSS RECEIPTS OF THE ASSESSEE ARE LESS THAN R S.1 CRORE AS THE ASSESSEE SOCIETY IN THE PRECEDING YEARS AND IT EXISTED SOLELY FOR EDUCA TIONAL PURPOSE NOT INVOLVING THE PROFIT, THE BENEFIT OF PROVISIONS OF SECTION 10(23C )(IIIAD), THEREFORE, CANNOT BE DENIED TO THE ASSESSEE MERELY ON THE BASIS OF SUSPI CION/PRESUMPTION AS DENIED BY THE ASSESSING OFFICER BUT RIGHTLY APPRECIATED BY TH E LD. FIRST APPELLATE AUTHORITY. KEEPING IN VIEW OF THE FACTS AND CIRCUMSTANCES OF T HE PRESENT CASE, WE ARE OF THE CONSIDERED VIEW THAT THE LD. FIRST APPELLATE AUTHOR ITY HAS RIGHTLY ALLOWED THE ITA NOS.388, 389 & 390/AGR/2010 A.YS. 2003-04, 2004-05 & 2005-06 11 EXEMPTION UNDER SECTION 10(23C)(IIIAD) TO THE ASSES SEE IN SPITE OF THE FACT THAT APPLICATION UNDER SECTION 12AA WAS REJECTED BY THE CIT(A) AT THAT TIME BUT ACCORDING TO THE ARGUMENT ADVANCED BY THE LD. COUNS EL FOR THE ASSESSEE AS PER THE PROOF OF DOCUMENTARY EVIDENCE THE SAME HAS BEEN ALL OWED ON 15.12.2009 BY THE COMMISSIONER OF INCOME TAX (CENTRAL), KANPUR KANPUR W.E.F. 01.04.2004. 12. AS REGARDS TO THE ADHOC ADDITION, WE FIND THAT THE LD. FIRST APPELLATE AUTHORITY HAS RIGHTLY DELETED THE ADDITION OF RS.2, 00,000/- BECAUSE THERE IS NOTHING ON RECORD REGARDING EXPENSES WHICH HAS BEEN FOUND A S INADMISSIBLE IN NATURE NOR ANY EVIDENCE TO SHOW THAT THE SAID EXPENSES WERE NO T INCURRED BUT FALSELY CLAIMED OR INCURRED FOR THE PURPOSE OTHER THAN EDUCATION PU RPOSE. WE CONFIRM THE IMPUGNED ORDER ON THIS ISSUE. 13. AS REGARDS TO THE ADDITION OF RS.17,12,419/- MA DE BY THE ASSESSING OFFICER ON ACCOUNT OF UNEXPLAINED INVESTMENT IN THE SCHOOL BUILDING, AFTER HEARING BOTH THE PARTIES AND PERUSING THE RELEVANT RECORDS AVAILABL E WITH US ESPECIALLY THE REPORT OF THE DVO, WE ARE OF THE CONSIDERED OPINION THAT THE ASSESSEE HAS DECLARED COST OF CONSTRUCTION RS.11,40,081/- AND THE DVO HAS ESTIMAT ED THE COST OF CONSTRUCTION AMOUNTING TO RS.13,95,944/-. THERE IS A DIFFERENCE OF RS.2,55,863/- AS PER THE REPORT ON RECORD RECEIVED FROM THE DVO NOT RS.17,12 ,419/- AS WORKED OUT BY THE ITA NOS.388, 389 & 390/AGR/2010 A.YS. 2003-04, 2004-05 & 2005-06 12 ASSESSING OFFICER IN HIS ASSESSMENT ORDER. THE LD. FIRST APPELLATE AUTHORITY HAS RIGHTLY APPRECIATED THE ARGUMENT ADVANCED BY THE LD . COUNSEL FOR THE ASSESSEE BY PASSING A DETAILED ORDER. WE FIND NO INFIRMITY IN THE WELL REASONED ORDER PASSED BY THE LD. FIRST APPELLATE AUTHORITY ON THE ISSUE IN D ISPUTE. THEREFORE, WE UPHOLD THE SAME BY DISMISSING THE APPEAL FILED BY THE REVENUE IN ITA NO.389/AGR/2010 FOR THE ASSESSMENT YEAR 2004-05. 14. SINCE THE FACTS AND THE ISSUES INVOLVED IN OTHE R TWO APPEALS ARE SIMILAR, WE ACCORDINGLY FOLLOWING THE DECISION TAKEN IN ITA NO. 389/AGR/2010, DISMISS THE APPEALS FILED BY THE REVENUE IN ITA NOS.388/AGR/201 0 & 390/AGR/2010 FOR THE ASSESSMENT YEARS 2003-04 AND 2005-06 RESPECTIVELY. IN THE RESULT, ALL THE THREE APPEALS FILED BY THE REVENUE ARE DISMISSED. (ORDER PRONOUNCED IN THE OPEN COURT ON 18.10.2011) SD/- SD/- (B.C. MEENA) (H.S. SIDHU) ACCOUNTANT MEMBER JUDICIAL MEMBER DATE: 18 TH OCTOBER, 2011 PBN/* COPY OF THE ORDER FORWARDED TO: APPELLANT/RESPONDENT/CIT CONCERNED/CIT(APPEALS) CO NCERNED/D.R., ITAT, AGRA BENCH, AGRA/GUARD FILE. BY ORDER ASSISTANT REGISTRAR INCOME-TAX APPELLATE T RIBUNAL, AGRA TRUE COPY