SAMYUKTA HEALTH & ACADEMIC SOCIETY, ANAKAPALLE V. INCOME TAX OFFICER, EXEMPTION WARD, VISAKHAPATNAM

ITA 45/VIZ/2023

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The case involves Samyukta Health & Academic Society, a charitable trust running educational institutions, which appealed against the order of the Commissioner of Income Tax (Appeals) at the National Faceless Appeal Centre, Delhi. The appeal arose from an assessment order passed by the Assessing Officer under section 143(1) of the Income Tax Act, 1961, for the Assessment Year 2020-21, which disallowed the exemption under section 11 and treated the gross receipts as total income. The Tribunal considered the society's eligibility for exemption under section 11 or alternatively under section 10(23C)(iiiad) due to its turnover not exceeding the stipulated limit. The Tribunal noted that the delay in filing Form No. 10B was not intentional and was due to the health issues of the Secretary of the Trust, which was supported by medical certificates.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 135919 (ITAT-VISAKHAPATNAM)
• Duration Of Justice: 3 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-05-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 23-04-2023
• Assessment Year: 2020-2021
• Appeal Filed On: 19-02-2023
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 154; 234B; 12A; 119(2)(b); 10B; 143(1)

Judgement Text

आयकरअपीलीयअधिकरण, धिशाखापटणम पीठ, धिशाखापटणम IN THE INCOME TAX APPELLATE TRIBUNAL, VISAKHAPATNAM BENCH, VISAKHAPATNAM श्री द ु व्वूरु आर एल रेड्डी, न्याधयक सदस्य एिं श्री एस बालाकृ ष्णन, लेखा सदस्य के समक्ष BEFORE SHRI DUVVURU RL REDDY, HON’BLE JUDICIAL MEMBER & SHRI S BALAKRISHNAN, HON’BLE ACCOUNTANT MEMBER आयकर अपील सं./I.T.A.No.45/Viz/2023 (ननधधारण वर्ा / Assessment Year : 2020-21) Samyukta Health & Academic Society Ramalayam Street, Gandhi Nagar Anakapalle [PAN : AAGTS9608E] Vs. Income Tax Officer Exemption Ward Visakhapatnam (अपीलार्थी/ Appellant) (प्रत्यर्थी/ Respondent) अपीलधथी की ओर से/ Appellant by : Shri G.V.N.Hari, AR प्रत्यधथी की ओर से / Respondent by : Shri ON Hari Prasada Rao, DR सुनवधई की तधरीख / Date of Hearing : 24.04.2023 घोर्णध की तधरीख/Date of Pronouncement : 23.05.2023 आदेश /O R D E R Per Shri Duvvuru RL Reddy, Judicial Member : This appeal is filed by the assessee against the order of Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi in DIN & Order No. ITBA/NFAC/S/250/2022- 23/10482/12219(1), arising out of the assessment order passed by the Assessing Officer (AO) u/s 143(1) of the Income Tax Act, 1961 (in short “Act”) for the Assessment Year (A.Y.) 2020-21. 2 I.T.A. No.45/Viz/2023, A.Y.2020-21 Samyukta Health & Academic Society, Anakapalle 2. Brief facts of the case are that the assessee trust is running educational institutions and is having registration u/s 12A of the Act. During the previous year relevant to A.Y.2020-21, the assessee derived gross receipts of Rs.98,84,543/- and incurred expenditure of Rs.83,54,906/-. The assessee filed return of income for A.Y.2020-21 on 08.02.2021, after claiming exemption of the expenditure of Rs.83,54,906/- u/s 11 and accumulation of 15% of the gross receipts at Rs.14,82,681/- u/s 11(2) of the Act and admitted total income of Rs.46,960/-. The return of income was processed and the intimation u/s 143(1) of the Act was issued on 30.11.2021 by disallowing the exemption u/s 11 of the Act and the gross receipts of Rs.98,84,453/- were treated as total income of the assessee. The tax payable was computed at Rs.39,13,120/- which included interest of Rs.5,00,416/- u/s 234B and Rs.1,57,944/- u/s 234C of the Act. No reason was mentioned in the intimation for disallowing the exemption except that “no forms filed”. After receiving the intimation, the assessee filed a request on 16.12.2021 for rectification of the intimation. The rectification order was passed on 20.04.2022 u/s 154 of the Act, without allowing the exemption and the total income was determined as the same in the intimation at Rs.98,54,543/-. 3 I.T.A. No.45/Viz/2023, A.Y.2020-21 Samyukta Health & Academic Society, Anakapalle 3. On being aggrieved, the assessee preferred an appeal before the CIT(A) and the Ld.CIT(A) partly allowed the appeal of the assessee as the condonation petition filed by the assessee was pending before the Ld.Commissioner of Income Tax (Exemptions), Hyderabad for condoning the delay in filing Form No.10B belatedly, which was an essential prerequisite for allowing exemption u/s 11. 4. On being aggrieved, the assessee preferred an appeal before the Tribunal by raising the following grounds of appeal : 1. The order of the learned Commissioner of Income Tax (Appeals) is contrary to the facts and also the law applicable to the facts of the case. 2. The learned Commissioner of Income Tax (Appeals) ought to have held that the addition of Rs.98,37,583/- made towards disallowance of exemption claimed u/s 11 of the Act is outside the scope of adjustments that can be made in the intimation u/s 143(1) of the Act. 3. The learned Commissioner of Income Tax (Appeals) ought to have directed the assessing officer to allow the exemption of Rs.98,37,583/- claimed by the appellant u/s 11 of the Act. 4. The learned Commissioner of Income Tax (Appeals) ought to have held that the appellant is eligible for exemption alternatively u/s 10(23C)(iiiad) of the Act as the gross receipts of the appellant did not exceed the stipulated limit of Rs.1 crore. 5. The learned Commissioner of Income Tax (Appeals) ought to have directed the assessing officer to allow the expenditure of Rs.83,54,906/- 6. Any other grounds may be urged at the time of hearing. 4 I.T.A. No.45/Viz/2023, A.Y.2020-21 Samyukta Health & Academic Society, Anakapalle 5. Ground No.1 and 6 are general in nature which does not require specific adjudication. 6. Ground Nos. 2 to 4 relate to disallowance of exemption claimed /s 11. The only contention of the assessee is that the assessee being a charitable trust, having registration u/s 12A of the Act is eligible for exemption u/s 11 of the Act. The Ld.AR contended that the assessee is running educational institutions and is eligible for exemption even u/s 10(23C)(iiiad) of the Act as it’s turnover did not exceed the stipulated limit. The assessee filed the return of income within the due date and also uploaded the audit report in Form No.10B along with the return of income on 08.02.2021, which should have been filed within tthe due date i.e. 15.01.2021. The assessee filed petition before the Ld.CIT(Exemptions) for condonation of the delay along with medical certificate. The Ld.AR submitted that the Secretary of the Trust who looks after the affairs of the Trust suffered from severe sciatica pain and was under treatment and bed rest during the period from 02.01.2021 to 05.02.2021. The assessee pleaded the Ld.CIT(E) to condone the delay as it was neither intentional nor deliberate. The Ld.AR, therefore, pleaded the Tribunal to set aside the order passed by the Ld.CIT(A) as the assessee is eligible for exemption u/s 11 or 10(23C)(iiiad) due to the foregoing reasons. 5 I.T.A. No.45/Viz/2023, A.Y.2020-21 Samyukta Health & Academic Society, Anakapalle 7. Per contra, the Ld.DR relied on the order of the Ld.CIT(A) and pleaded to uphold the same and dismiss the appeal of the assessee. 8. We have heard both the parties and perused the material placed on record. It is evident from the record that the assessee filed the return of income and uploaded Form 10B beyond the due date and accordingly filed an application u/s 119(2)(b) of the Act dated 29.11.2022 for condonation of delay for the A.Y.2020-21 before the Ld.CIT(E). It is evident from records that after careful consideration of the submissions made by the assessee, the Ld.CIT(E) vide letter DIN & Order No.ITBA/COM/F/17/2022-23/1050844096(1) dated 16.03.2023 condoned the delay in filing Form 10B for the A.Y.2020-21 as per the CBDT Circular No.16/2022 in F.No.197/89/2022-ITA-1 dated 19.07.2022. Since the delay is condoned by the Ld.CIT(E) and since the assessee is having registration u/s 12A of the Act and it’s turnover did not exceed the stipulated limit, we are inclined to remit the matter back to the file of the AO with a direction to grant exemption u/s 11 of the Act. Hence, the appeal filed by the assessee is allowed. 9. In the result, appeal filed by the assessee is allowed. 6 I.T.A. No.45/Viz/2023, A.Y.2020-21 Samyukta Health & Academic Society, Anakapalle Order pronounced in the open court on 23 rd May 2023. Sd/- Sd/- (एस बालाकृ ष्णन) (द ु व्वूरु आर.एल रेड्डी) (S.BALAKRISHNAN) (DUVVURU RL REDDY) लेखा सदस्य/ACCOUNTANT MEMBER न्याधयक सदस्य/JUDICIAL MEMBER Dated : 23.05.2023 L.Rama, SPS आदेश की प्रतितिति अग्रेतिि/Copy of the order forwarded to:- 1. ननधधाऩरती/ The Assessee– M/s Samyukta Health & Academic Society Ramalayam Street, Gandhi Nagar, Anakapalle 2. रधजस्व/The Revenue – Income Tax Officer, Exemption Ward, Infinity Towers, Sankaramatam Road, Visakhapatnam 3. The Commissioner of Income Tax (Appeals), NFAC, Dehi 4. The Principal Commissioner of Income Tax, Visakhapatnam 5. नवभधगीय प्रनतनननध, आयकर अपीलीय अनधकरण, नवशधखधपटणम / DR,ITAT, Visakhapatnam 6..गधर्ा फ़धईल / Guard file आदेशधनुसधर / BY ORDER Sr. Private Secretary ITAT, Visakhapatnam