ACIT, Rewari V. M/s. Shiksha Samiti, Haryana

ITA 5083/DEL/2012

• Counselvise Citation: 508320114 RSA 2012
• Duration Of Justice: 2 year(s) 4 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-02-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: G
• Next Hearing Date: 02-02-2015
• Assessment Year: 2008-2009
• Appeal Filed On: 01-10-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: B R R KUMAR
• Keywords: Capital receipt
• Section: 12A; 148; 12; 10

Judgement Text

ITA NO. 5083/ DEL/ 2012 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH G , NEW DELHI BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER AND SHRI J.S. REDDY, ACCOUNTANT MEMBER I.T.A. NO. 5 083 /DEL/201 2 A.Y. : 200 8 - 0 9 ASSISTANT COMMISSIONER OF INCOME TAX, REWARI CIRCLE, AAYAKAR BHAWAN, MODEL TOWN, REWAARI VS. M/S SHIKSHA SAMITI, KANINA, DISTT. MAHENDERGARH (HARYANA) (APPELLANT) (RESPONDENT) DEPARTMENT BY : S HRI B.R.R. KUMAR, SR. DR ASSESSEE BY : S HRI R.S. SINGHVI, ADV. DATE OF HEARING : 11 - 02 - 201 5 DATE OF ORDER : 1 6 - 02 - 201 5 ORDER PER H.S. SIDHU : J M REVENUE HAS FILED THIS A PPEAL AGAINST THE IMPUGNED ORDER DATED 2 0 .7.201 2 PASSED BY THE LD. CIT(A), ROHTAK RELEVANT TO ASSESSMENT YEAR 200 8 - 0 9 . 2. THE FOLLOWING GROUNDS HAVE BEEN RAISED : - 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) HAS ERRED IN LAW AND FACTS IN DELETING THE ADDITIONS MADE BY THE AO AMOUNTING TO RS. 20,98,900/ - AS ACCORDING TO HIM THE ASSESSEE WAS NOT ENTITLED FOR CLAIM OF EXEMPTION OF SURPLUS INCOME O F RS. 20,98,900/ - U/S. 10(23C)(IIIAD) OF THE I.T. ACT, ITA NO. 5083/ DEL/ 2012 2 1961 AS THE TOTAL RECEIPTS DURING THE YEAR EXCEEDED RS. 1.00 CRORE; THE LD. CIT(A) DELETED THE SAID ADDITION WITHOUT APPRECIATING THE FACTS OF THE CASE BROUGHT ON RECORD BY THE AO. 2. THAT THE APPELLA NT CRAVES FOR THE PERMISSION TO ADD, DELETE OR AMEND THE GROUND OF APPEAL BEFORE OR AT THE TIME OF HEARING OF APPEAL. 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE SOCIETY FILED RETURN OF INCOME DECLARING NIL TOTAL INCOME AFTER CLAIMING THE W HOLE OF ITS SURPLUS OF RS. 20,98,900/ - AS EXEMPT U/S. 10(23C)(IIIAD) OF THE ACT. THE AO ISSUED NOTICE U/S. 148 FOR REOPENING THE ASSESSMENT ON THE GROUNDS THAT THE ANNUAL RECEIPTS (CAPITAL AND REVENUE) FOR THE YEAR UNDER CONSIDERATION EXCEEDED RS. 1.00 CRORE AND AS SUCH IT IS NOT ELIGIBLE FOR EXEMPTION U/S. 10(23C)(IIIAD). DURING THE ASSESSMENT PROCEEDINGS, AO NOTED THAT THE AR OF THE ASSESSEE HAS SUBMITTED THAT THE RECEIPTS OF THE SOCIETY ARE ONLY RS. 60,24,857/ - AND AN AMOUNT OF RS. 39,14,102/ - WAS RECEIVED AS DONATION TOWARDS CORPUS FUND. THE DONATION TOWARDS CORPUS FUNDS SHALL NOT BE ADDED TOWARDS RECEIPTS OF THE SOCIETY. AO FURTHER NOTED THAT THE CORPUS FUND WAS TO CONSTRUCT BUILDING OF THE SOCIETY AND THEREFORE, IT SHOULD BE TREATED A S CAPITAL RECEIPT OF THE SOCIETY. THE AO THEREFORE HELD THAT THE RECEIPTS OF THE SOCIETY EXCEEDED RS. 1.00 CRORE AND THEREFORE EXEMPTION U/S. 10(23C)(IIIAD) IS NOT ALLOWED. THE AO THUS MADE THE ASSESSMENT VIDE HIS ASSESSMENT ORDER DATED 19.12.2011 PASS ED U/S. 148/143(3) OF THE I.T. ACT AND BROUGHT TO TAX THE SURPLUS INCOME OF RS. 20,98,900/ - IN THE HANDS OF THE ASSESSEE. ITA NO. 5083/ DEL/ 2012 3 4. AGAINST THE AFORESAID ASSESSMENT ORDER DATED 19.12.2011, ASSESSEE FILED THE APPEAL BEFORE THE LD. CIT(A), WHO VIDE IMPUGNED O RDER DATED 20.7.2012 DELETED THE ADDITION IN DISPUTE BY ALLOWING THE APPEAL FILED BY THE ASSESSEE. 5. AGGRIEVED WITH THE ABOVE ORDER DATED 20.7.2012 PASSED BY THE LD. CIT(A), ROHTAK, REVENUE IS IN APPEAL BEFORE THE TRIBUNAL. 6. WE HAVE HEARD BOTH THE P ARTIES, PERUSED AND CONSIDERED THE RELEVANT RECORDS AVAILABLE WITH US, ESPECIALLY THE ORDERS OF THE REVENUE AUTHORITIES. WE FIND THAT THE LD. CIT(A) HAS OBSERVED THAT THE ASSESSEE - SOCIETY IS RUNNING AN EDUCATIONAL INSTITUTION AND IS REGISTERED U/S. 12 A OF THE ACT. LD. CIT(A) NOTED THAT IN THE PRESENT CASE, THE TOTAL RECEIPTS OF THE EDUCATIONAL INSTITUTION OF RS. 69,24,857/ - WHEREAS SOCIETY RECEIVED RS. 39,15,102/ - AS DONATION TOWARDS CORPUS FUND. LD. CIT(A) FURTHER NOTED THAT THE LIST OF THE DONORS FOR THE SURPLUS FUND HAS BEEN FURNISHED TO THE A O AND THE A O HELD IN THE ASSESSMENT ORDER THAT THE CORPUS FUND WAS FOR CONSTRUCTION OF BUILDING OF THE SOCIETY. LD. CIT(A) RELIED UPON THE DECISION OF THE ITAT, CHANDIGARH BENCH IN THE CASE OF SH. MAHADEVI TIRATH SHARDA MAA SEVA SANGH VS IT O IN ITA NO. 1091/CHD/2009 ORDER DATED 29.01.2010 HOLDING THAT AMOUNTS CONTRIBUTED VOLUNTARILY BY THE DONORS WITH SPECIFIC DIRECTION THAT IT SHALL FORM PART OF CORPUS WOULD NOT CONSTITUTE INCOME OF THE SOCIETY. THEREFORE T HE RECEIPTS OF THE EDUCATIONAL INSTITUTION ARE BELOW RS . 1.00 CRORE AND AS SUCH EXEMPTION U/S 10(23C)(IIIAD) IS ALLOWABLE. WE FIND THAT ITA NO. 5083/ DEL/ 2012 4 THE LD. CIT(A) FURTHER OBSERVED THAT ITA T, DELHI IN THE CASE OF JAT EDUCATION SOCIETY VS DCIT IN ITA NOS. 3769 & 3770 /D E L/2008 VIDE ORDER DATED 11.03.2011 HAS HELD THAT FOR THE PURPOSE OF SECTION 10(23C)(IIIAD), IN THE TERM 'AGGREGATE ANNUAL RECEIPTS' REFERS TO THE RECEIPTS BY THE EDUCATIONAL INSTITUTION AND NOT THAT OF THE SOCIETY. IN THE PRESENT CASE ALSO THE RECEIPTS OF THE EDUCATIONAL INSTITUTION ARE ONLY RS.69,23,857/ - AND T HE CORPUS DONATION WAS RECEIVED BY SOCIETY. THEREFORE, LD. CIT(A) HAS RIGHTLY HELD THAT THE EXEMPTION CLAIMED U/ S 10 (23C) (IIIAD) IS ALLOWABLE. LD. CIT(A) HAS CONSIDERED THE ISSUE AND THE SUBMI SSIONS MADE BY THE AR AND RIGHTLY OBSERVED THAT THE AO HIMSELF HELD THAT THE DONATIONS RECEIVED BY THE SOCIETY OF RS . 39,15,102/ - ARE FOR THE CORPUS FUND FOR THE CONSTRUCTION OF BUILDING OF THE SOCIETY. DONATIONS FOR THE CORPUS FUND ARE EXEMPT U/S 11 OF T HE ACT. IN THE PRESENT CASE, THOUGH THE SOCIETY WAS REGISTERED U/S 12A OF THE ACT, EXEMPTION U/S 11 WAS NOT CLAIMED IN THE RETURN OF INCOME AND AS SUCH IT CANNOT BE ENTERTAINED. WE FIND THAT THE CORPUS DONATIONS RECEIVED BY THE A SSESSEE SOCIETY ARE SEPARA TED, THE ANNUAL RECEIPTS OF THE EDUCATIONAL INSTITUTION ARE ONLY RS 69,24,857/ - . K EEPING I N VIEW OF THE ORDER OF ITAT IN THE CASE OF JAT EDUCATION SOCIETY VS DCIT (SUPRA), EXEMPTION U/S. 10(23C) (IIIAD) CAN BE DENIED IF THE AGGREGATE ANNUAL RECEIPTS OF EA CH EDUCATIONAL INSTITUTION IS MORE THAN RS 1.00 CRORE. WE ARE OF THE VIEW THAT SI NCE THE ANNUAL RECEIPTS OF THE EDUCATIO NAL INSTITUTION OF THE ASSESSEE ITA NO. 5083/ DEL/ 2012 5 SOCIETY ARE BELOW RS. 1.00 CRORE, EXEMPTION U/S. 10(23C)(IIIAD) OF THE ACT THE SURPLUS IS ALLOW ABLE AN D ACCORDINGLY . LD. CIT(A) HAS RIGHTLY DELETED THE ADDITION IN DISPUTE. IN VIEW OF THE ABOVE, WE ARE OF THE VIEW THAT NO INTERFERENCE IS CALLED FOR IN THE WELL REASONED ORDER PASSED BY THE LD. CIT(A), HENCE, WE UPHOLD THE SAME. 7 . IN THE RESULT, THE APPEAL FILED BY THE REVENUE STANDS DISMISSED. ORDER PRONOUNCED IN THE O PEN C OURT ON 1 6 / 2 /20 1 5 . SD / - S D / - [ J.S. REDDY ] [ H.S. SIDHU ] ACCOUNTANT MEMBER JUDICIAL MEMBER DATE 1 6 / 2 /201 5 SRBHATNAGAR COPY FORWARDED TO: - 1. APPELLANT - 2. RESPONDENT - 3. CIT 4. CIT (A) 5. DR, ITAT TRUE COPY BY ORDER, ASSISTANT REGISTRAR, ITAT, DELHI BENCHES ITA NO. 5083/ DEL/ 2012 6