Durga Devi Shivnarayan Memorial Society, Bokaro V. ITO, Exemption Ward, Hazaribag

ITA 5/RAN/2020

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 8308 (ITAT-RANCHI)
• Duration Of Justice: 1 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-03-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2014-2015
• Appeal Filed On: 20-01-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: DEVESH PODDAR SHRI AJAY KUM
• Keywords: Capital receipt
• Section: 12AA; 147

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL: RANCHI BENCH, RANCHI BEFORE SHRI S.S.GODARA, JUDICIAL MEMBER I.T.A NO.05/RAN/2020 ASSESSMENT YEAR: 2014-15 DURGA DEVI SHIVNARAYAN MEMORIAL SOCIETY H/O SRI SURESH KUMAR AGARWAL, BYE PASS ROAD, CHAS, BOKARO, JHARKHAND-827013. VS. ITO, EXEMPTION WARD, HAZARIBAGH PAN/GIR NO. : AABAD3089N ( APPELL ANT ) .. (RESPONDENT) APPELLANT BY SHRI DEVESH PODDAR, ADVOCATE RESPONDENT BY SHRI AJAY KUMAR, ADDL. CIT(DR) DATE OF HEARING 05.03.2020 DATE OF PRONOUNCEMENT 05.03.2020 O R D E R S. S. GODARA(ORAL): THIS ASSESSEES APPEAL FOR ASSESSMENT YEAR 2014-15 ARISES AGAINST THE COMMISSIONER OF INCOME TAX (APPEALS), HAZARIBAGH DATED 25.11.2019 PASSED IN CASE NO.CIT(A),HAZARIBAGH/10083/2018-19 INVOLVING PROCEEDINGS U/S 147 OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT). HEARD BOTH THE PARTIES. CASE FILE PERUSED. 2. THE ASSESSEES SOLE SUBSTANTIVE GRIEVANCE RAISED IN THE INSTANT APPEAL READS THAT BOTH THE LOWER AUTHORITIES ACTION HAVE ERRED IN LAW AND ON FACTS IN ADDING CORPUS DONATION OF RS.13,75,000/-. THERE IS NO DISPUTE THAT THIS ASSESSEE IS NOT A REGISTERED TRUST U/S 12AA OF THE ACT. THERE IS ALSO NO QUARREL THAT THE IMPUGNED ADDITION AMOUNT REPRESENTS CORPUS DONATION ONLY. I NOTICE IN THIS BACKDROP THAT THIS TRIBUNALS COORDINATE DECISION IN ITA 621/PUN/2016 DATED 29.01.2018 HOLDS THAT SUCH A CORPUS DONATION IS NOT LIABLE TO BE ADDED EVEN IN CASE OF A SOCIETY OR TRUST NOT REGISTERED U/S 12AA OF THE ACT AS UNDER: I.T.A NO.05/RAN/2020 DURGA DEVI SHIVNARAYAN MEMORIAL SOCIETY 2 22. THE ABOVE EXTRACTED PORTION IS RELEVANT FOR THE RATIOS THAT THE CORPUS DONATIONS RECEIVED BY THE TRUSTS, WHICH IS NOT REGISTERED U/S.12A/12AA OF THE ACT, ARE NOT TAXABLE AS THEY ASSUME THE NATURE OF 'CAPITAL RECEIPT' THE MOMENT THE DONATIONS ARE GIVEN TO THE 'CORPUS OF THE TRUST'. 23. WE FIND THE PROVISIONS OF SECTION (24)(IIA)/12(1)/11(1)(D)/35/56(2) ARE RELEVANT FOR DECIDING THE CURRENT ISSUE. IT IS A SETTLED LEGAL PROPOSITION, IN CASE OF A REGISTERED TRUST UNDER THE INCOME-TAX ACT, THE CORPUS SPECIFIC VOLUNTARY CONTRIBUTIONS ARE OUTSIDE THE SCOPE OF INCOME AS DEFINED IN SECTION 2(24)(IIA) OF THE ACT DUE TO THEIR 'CAPITAL NATURE'. BUT IT IS A CASE OF UN-REGISTERED TRUST. DESPITE THE DETAILED DELIBERATIONS MADE BY THE LD. DR, WE FIND THE PRINCIPLES RELATING TO JUDICIAL DISCIPLINE ASSUME SIGNIFICANCE AND THE PRIORITY. IT IS ALSO DECIDED ISSUE THAT THERE IS NEED FOR UPHOLDING THE FAVOURABLE VIEW IF THERE EXISTS DIVERGENT VIEWS ON THE ISSUE. AS DISCUSSED IN THE PRECEDING PARAGRAPHS ABOVE, THERE ARE MULTIPLE DECISIONS IN FAVOUR OF THE ASSESSEE. 24. ACCORDINGLY, THE CORPUS-SPECIFIC-VOLUNTARY CONTRIBUTIONS ARE OUTSIDE THE TAXATIONS IN CASE OF UNREGISTERED TRUST U/S.12/12A/12AAA OF THE ACT TOO. FROM THIS POINT OF VIEW, AND FOR THIS REASON, THE DECISION OF THE CIT(A) IN GRANTING RELIEF TO ASSESSEE DOES NOT CALL FOR ANY INTERFERENCES. ACCORDINGLY, GROUNDS OF APPEAL RAISED BY THE REVENUE ARE DISMISSED. I ADOPT THIS FOREGOING DETAILED REASONING MUTATIS MUTANDIS AND DIRECT THE ASSESSING OFFICER TO DELETE THE IMPUGNED ADDITION. 3. NO OTHER GROUNDS HAVE BEEN PRESSED BEFORE ME DURING THE COURSE OF HEARING. 4. THIS ASSESSEES APPEAL IS ALLOWED IN ABOVE TERMS. ORDER IS PRONOUNCED IN THE OPEN COURT ON 05.03.2020. SD/- (S. S. GODARA) JUDICIAL MEMBER DATED: 05.03.2020. RS COPY OF THE ORDER FORWARDED TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT CONCERNED 4. THE CIT(A) - 5. THE DR, ITAT, RANCHI 6. GUARD FILE BY ORDER SR. P.S., ITAT, RANCHI (ON TOUR)