FAKHERA CHARITABLE TRUST, MUMBAI V. EXEM, WARD 1(3), MUMBAI

ITA 447/MUM/2023

AI Insights

The case involves the Fakhera Charitable Trust, which appealed against the order of the National Faceless Appeal Centre (NFAC), Delhi / CIT(A), concerning the disallowance of expenditure claimed for the assessment year 2018-19. The trust had filed its return disclosing a total income after claiming substantial expenditure towards charitable purposes, which was disallowed by the assessing officer under section 143(1) of the Income Tax Act. The CIT(A) upheld this decision due to the absence of the trust's compliance with hearing notices. The Tribunal, considering the principles of natural justice, decided to provide another opportunity for the trust to present its case and remitted the matter back to the CIT(A).

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 300141 (ITAT-MUMBAI)
• Duration Of Justice: 1 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-04-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 19-04-2023
• Assessment Year: 2018-2019
• Appeal Filed On: 14-02-2023
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Charitable institution
• Section: 143(1); 250

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH, MUMBAI BEFORE SHRI BR BASKARAN, ACCOUNTANT MEMBER & SHIR PAVAN KUMAR GADALE, JUDICIAL MEMBER ITA No. 447/Mum/2023 (A.Y: 2018-19) Fakhera CharitableTrust 6B, Crown Mansion, Forjett Street, Crosslane Gowalia Tank, Mumbai-400023. Vs. ITO(Exemp)Ward1(3), MTNLBuilding, Cumballa Hills, Peddar Road, Mumbai-400026 PAN/GIR No. : AAATF1659C Appellant .. Respondent Appellant by : None Respondent by : Ms. Naina K.Kumar.DR Date of Hearing 20.04.2023 Date of Pronouncement 21.04.2023 आदेश / O R D E R PER PAVAN KUMAR GADALE JM: The assessee has filed the appeal against the order of National Faceless Appeal Centre (NFAC), Delhi / CIT(A) order passed U/sec 250 of the Act. The assessee has raised the following grounds of appeal: 1. The intimation passed by assessing officer u/s. 143(1) of I.T. Act and confirmed by First Appellant Authority is bad in law and deserves to be uncalled for. ITA Nos. 447/Mum/2023 Fakhera Charitable Trust, Mumbai. - 2 - 2. The assessing officer as well as First Appellant Authority has erred in law and on facts in not allowing the deduction of expenditure incurred by the appellant amounting to Rs. 37,53,460/-. 3. The appellant craves to reserve his right to add, alter, amend, or delete any ground of appeal during the course of hearing. 2. The brief facts of the case that the assessee is a charitable trust and filed the return of income for the A.Y 2018-19 on 08.10.2018 disclosing a total income of Rs. 89,950/- after claiming the expenditure of Rs. 37,53,460/- towards the application of funds for charitable purpose. Whereas the return of income was processed u/s 143(1) of the Act with disallowance of the claim and the total income was determined at Rs. 38,48,520/- vide order dated 01.10.2019. 3. Aggrieved by the order, the assessee has filed an appeal before the CIT(A),whereas the CIT(A) has considered the grounds of appeal, statement of facts and findings of the AO and has issued notices of hearing and since there was no compliance by the assessee to notices. Therefore the CIT(A) considering the information on record has confirmed the action of the A.O and dismissed the appeal. Aggrieved by the ITA Nos. 447/Mum/2023 Fakhera Charitable Trust, Mumbai. - 3 - order of the CIT(A), the assessee has filed an appeal before the Hon’ble Tribunal. 4. At the time of hearing, none appeared on behalf of the assessee and the Ld.DR has supported the order of the CIT(A). 5. We heard the Ld.DR submissions and perused the material on record. Prima-facie the CIT(A) has passed the order considering the fact that there is no appearance in spite of providing adequate opportunity of hearing and the notices were issued. Therefore, the CIT(A) was of the opinion that the assessee is not interested in prosecuting the appeal and dismissed the appeal ex-parte confirming the action of the assessing officer. The Ld.CIT(A) has issued the notices of hearing referred at Page 2 Para 4 of the order, but there was no response and thus the Ld.CIT(A) came to a conclusion that the assessee is not interested and decided the appeal based on the information available on record. Whereas the assessee has raised grounds of appeal challenging the additions of the A.O and there could be various reasons for non appearance which cannot be overruled. Therefore, considering the principles of ITA Nos. 447/Mum/2023 Fakhera Charitable Trust, Mumbai. - 4 - natural justice shall provide one more opportunity of hearing to the assessee to substantiate the case with evidences and information. Accordingly, we set aside the order of the CIT(A) and remit the entire disputed issues to the file of the CIT(A) to adjudicate afresh and the assessee should be provided adequate opportunity of hearing and shall cooperate in submitting the information for early disposal of the appeal and we allow the grounds of appeal of the assessee for statistical purposes. 6. In the result, the appeal filed by the assessee is allowed for statistical purposes. Order pronounced in the open court on 21.04.2023. Sd/- Sd/- (BR BASKARAN) (PAVAN KUMAR GADALE) ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai, Dated 21.04.2023 KRK, PS Copy of the Order forwarded to : 1. The Appellant 2. The Respondent 3. The CIT (Judicial) ITA Nos. 447/Mum/2023 Fakhera Charitable Trust, Mumbai. - 5 - 4. The PCIT 5. DR, ITAT, Mumbai 6. Guard File आदेशान ु सार/ BY ORDER, //True Copy//() 1. ( Asst. Registrar) ITAT, Mumbai