ITO (E), New Delhi V. M/s. Young Women's Christian Association of Delhi, New Delhi

ITA 5202/DEL/2016

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 3507 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 1 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-11-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: G
• Assessment Year: 2010-2011
• Appeal Filed On: 03-10-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S S RANA
• Assessee Lawyers: ARTA TRANA
• Keywords: Charitable institution; Competent authority
• Section: 143(1); 143(2)

Judgement Text

, , , , IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES G, DELHI .. , , , ! BEFORE SHRI N.K. SAINI, ACCOUNTANT MEMBER AND SHRI JOGINDER SINGH, JUDICIAL MEMBER, ITA NO.5202 /DEL/2016 ASSESSMENT YEAR: 2010-11 ITO(E), WARD-2(3), ROOM NO.2407, E-2 BLOCK, DR S. P. MUKHERJEE CIVIC CENTRE, NEW DELHI-110002 / VS. M/S YOUNG WOMENS CHRISTIAN ASSOCIATION OF DELHI, ASHOK ROAD, NEW DELHI-1100001 ( / REVENUE) ( &' /ASSESSEE) PAN. NO. AAATY0027H + / DATE OF HEARING : 07/11/2017 + / DATE OF ORDER: 07/11/2017 / REVENUE BY SHRI S.S. RANA - CIT DR &' / ASSESSEE BY SHRI ARTA TRANA PANDA ITA NO.5202/DEL./2016 YOUNG WOMENS CHRISTIAN ASSOCIATION OF DELHI 2 / O R D E R PER JOGINDER SINGH (JUDICIAL MEMBER) THE REVENUE IS AGGRIEVED BY THE IMPUGNED ORDER DATED 28/07/2016 OF THE LD. FIRST APPELLATE AUTHORI TY, NEW DELHI, ALLOWING EXEMPTION U/S 11(1) OF THE INCO ME TAX ACT, 1961 (HEREINAFTER THE ACT), IGNORING THE FACT THAT THE ACTIVITIES OF THE ASSESSEE IS IN THE NATURE OF TRAD E, COMMERCE/BUSINESS, WHICH FALLS UNDER THE ADVANCE O F ANY OTHER OBJECTS OF GENERAL PUBLIC UTILITY AND HIT BY THE PROVISO TO SECTION 2(15) OF THE ACT. 2. DURING HEARING, SHRI S.S. RANA, LD. CIT-DR, DEFENDED THE ADDITION MADE BY THE ASSESSING OFFICER , ADVANCING ARGUMENTS, WHICH IS IDENTICAL TO THE GROU ND RAISED. ON THE OTHER HAND, SHRI ARTA TRANA PANDA, L D. COUNSEL FOR THE ASSESSEE, DEFENDED THE IMPUGNED ORD ER. 2.1. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE FACTS , IN BRIEF, ARE THAT THE ASSESSEE SOCIETY IS REGISTERED UNDER SOCIETIES REGISTRATION ACT TO FULFILL THE BASIC AIM S AND OBJECTS OF THE SOCIETY. THE ASSESSEE IS ROOTED IN THE ITA NO.5202/DEL./2016 YOUNG WOMENS CHRISTIAN ASSOCIATION OF DELHI 3 CHRISTIAN FAITH AND ENDEAVOUR TO PROMOTE THE FULL DEVELOPMENT OF WOMEN/GIRLS IRRESPECTIVE OF RACE, CU LTURE AND CREED. THE ASSESSEE SOCIETY IS REGISTERED U/S 1 2A OF THE ACT BY THE COMPETENT AUTHORITY. THE ASSESSEE DECLA RED NIL INCOME IN ITS RETURN, FILED ON 04/03/2001, WHICH WA S ACCOMPANIED BY AUDIT REPORT IN FORM NO.10B FOR EXER CISING OPTION U/S 11(2) OF THE ACT. THE RETURN OF THE ASS ESSEE WAS PROCESSED U/S 143(1) OF THE ACT AND THEREAFTER THE CASE OF THE ASSESSEE WAS PICKED UP FOR SCRUTINY, THEREFORE, NOTICE U/S 143(2) WAS ISSUED TO THE ASSESSEE. IN COMPLIANC E OF THE SAME, THE ASSESSEE ATTENDED THE PROCEEDINGS AND FIL ED INFORMATION/DOCUMENTS/BOOKS OF ACCOUNTS ALONG WITH BILLS/VOUCHERS, WITH RESPECT TO THE EXPENDITURE INC URRED AND EVIDENCE OF HAVING EARNED INCOME FROM DIFFERENT HEADS AS IS EVIDENT FROM ASSESSMENT ORDER ITSELF. THE ASS ESSEE SHOWED SURPLUS/DEFICIT IN ITS ACCOUNTS FROM WHICH T HE LD. AO NOTED THAT THE ASSESSEE DID NOT INCLUDE INCOME O F WOMEN TRAINING INSTITUTE, THEREFORE, APPLYING THE P ROVISO TO SECTION 2(15) OF THE ACT, THE ASSESSMENT WAS FRAMED . ITA NO.5202/DEL./2016 YOUNG WOMENS CHRISTIAN ASSOCIATION OF DELHI 4 2.2. ON APPEAL, BEFORE THE LD. CIT(A), THE FACTUAL MATRIX WAS CONSIDERED AND THE FOLLOWING THE DECISIO N OF THE TRIBUNAL FOR A.Y. 2009-10, THE LD. AO WAS DIRECTED TO ALLOW EXEMPTION ON THE EARNING FROM UNRECOGNIZED COURSES AS WELL, AS BEING INCLUDED IN THE DEFINITION OF EDUCA TION. THE REVENUE IS AGGRIEVED AND IS IN APPEAL BEFORE THIS T RIBUNAL. 2.3. IF THE OBSERVATION MADE IN THE ASSESSMENT ORD ER, CONCLUSION DRAWN IN THE IMPUGNED ORDER, AND THE MAT ERIAL FACTS, AVAILABLE ON RECORD, ARE KEPT IN JUXTAPOSITI ON AND ANALYZED, THERE IS NO DISPUTE TO THE FACT THAT IDEN TICALLY FOR AY 2009-10, IN THE CASE OF ASSESSEE ITSELF, THE TRI BUNAL VIDE ORDER DATED 15/02/2016 (ITA NO.1019/DEL/2013) HELD THAT THE UNRECOGNIZED COURSES ARE ALSO COMES WITHIN THE MEANING OF EDUCATION OR IN OTHER WORDS, IT CAN BE S AID THAT THE CHARITABLE PURPOSES INCLUDES RELIEF TO THE POOR , EDUCATION (YOGA), MEDICAL RELIEF, PRESERVATION OF ENVIRONMENT AND PRESERVATION OF MONUMENTS OR PLACED OR OBJECTS OF ARTISTIC OR HISTORIC INTEREST AND THE AD VANCEMENT OF ANY OTHER OBJECTION OF GENERAL PUBLIC UTILITY. A DMITTEDLY, SUBSTITUTION WAS MADE BY THE FINANCE ACT, 2015 W.E. F. ITA NO.5202/DEL./2016 YOUNG WOMENS CHRISTIAN ASSOCIATION OF DELHI 5 01/04/2016 AS PER WHICH THE ADVANCEMENT OF ANY OTHE R OBJECT OF GENERAL PUBLIC UTILITY SHALL NOT BE CONCE ALED AS CHARITABLE, IF IT INVOLVES THE, CARRYING ON ANY ACT IVITY IN THE NATURE OF TRADE, COMMERCE OR BUSINESS, OR ANY ACTIV ITY OF RENDERING ANY SERVICE IN RELATION TO ANY TRADE, COM MERCE OR BUSINESS FOR A CESS OR FEE OR ANY OTHER CONSIDERATI ON, IRRESPECTIVE OF THE NATURE OF USE OR APPLICATION OR RETENTION OF THE INCOME FROM SUCH ACTIVITY. WE OBSERVE HERE THAT NO DIFFERENTIATION HAS BEEN MADE WITH RESPECT TO EDUCA TION WHETHER THE COURSES ARE RECOGNIZED OR UNRECOGNIZED. WE ARE OF THE VIEW, UNLESS AND UNTIL SPECIFIC LANGUAGE IS USED IN THE SECTION DIFFERENTIATING THE COURSES (RECOGNIZED OR UNRECOGNIZED), THE PLAIN LANGUAGE USED IN THE SECTI ON HAS TO BE CONSIDERED. THE LD. AO, WHILE MAKING THE ADDITIO N TAXED THE INCOME ON THE GROUND THAT THE RECEIPTS ARE FROM NON- RECOGNIZED COURSES, THEREFORE, IT IS FOR NON-CHARIT ABLE PURPOSES. THE CLAIM OF THE ASSESSEE IS THAT THE DEP OSITS MADE BY THE ASSESSEE ARE WHOLLY USED FOR CHARITABLE PURPOSES AND NEITHER THE PRINCIPAL NOR THE TRUSTEES ARE IN A POSITION TO UTILIZED THE DEPOSITS FOR ANY OTHER PUR POSES EXCEPT CHARITABLE PURPOSES. IT IS ALSO NOTED THAT E VEN IN THE ITA NO.5202/DEL./2016 YOUNG WOMENS CHRISTIAN ASSOCIATION OF DELHI 6 ASSESSMENT ORDER, THE LD. AO NOWHERE POINTED OUT TH AT THE RECEIPTS EARNED BY THE ASSESSEE WERE UTILIZED FOR N ON- CHARITABLE PURPOSES. UNDER THE PROVISIONS OF EXPLAN ATION-2 OF SECTION-11(1) ACCUMULATION OF THE AMOUNT OF INCO ME, DERIVED FROM PROPERTY HELD UNDER THE TRUST, ARE PER MITTED TO BE ACCUMULATED U/S 11(2) AND UNDER THE PROVISION OF SECTION 11(1) OF THE ACT, THE EARNING OF THE ASSESS EE FROM PROPERTY HELD FOR CHARITABLE PURPOSES IS PERMITTED TO BE ACCUMULATED UP TO THE SPECIFIED LIMIT OF ITS GROSS RECEIPTS. THE ASSESSEE SOCIETY IS IMPARTING EDUCATION TO THE POOR WOMAN FOR PROVIDING VOCATIONAL AND NON-VOCATIONAL EDUCATION, WHICH HAS BEEN CONSIDERED BY THE TRIBUNA L IN ITS OWN CASE FOR AY 2009-10. THE PROVISO TO SECTION-2(1 5) IS APPLICABLE ONLY IN A SITUATION, WHEN THE ACTIVITIES OF THE ASSESSEE ARE FOUND AGAINST THE PURPOSES/ACT AND THE PRIMARY OBJECTIVE EVEN IF IT IS UNRECOGNIZED BY THE UNIVERSITY/BOARD, IT CANNOT BE SAID THAT THE EDUCAT ION IS NOT BEING IMPARTED. THUS, WE DONT FIND ANY INFIRMI TY IN THE CONCLUSION OF THE LD. CIT(A), FOLLOWING THE ORDER O F THE TRIBUNAL FOR A.Y. 2009-10 AND THAT TOO IN THE ABSEN CE OF ITA NO.5202/DEL./2016 YOUNG WOMENS CHRISTIAN ASSOCIATION OF DELHI 7 ANY CONTRARY FACTS, WE FIND NO MERIT IN THE GROUND RAISED BY THE REVENUE, THEREFORE, THE IMPUGNED APPEAL IS DISM ISSED. FINALLY, THE APPEAL OF THE REVENUE IS DISMISSED. THIS ORDER WAS PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF THE LD. REPRESENTATIVE FROM BOTH SIDES AT THE CONCLUSION OF THE HEARING ON 07/11/2017 SD/- SD/- (N. K. SAINI) (JOGINDER SINGH) ' / ACCOUNTANT MEMBER # ' /JUDICIAL MEMBER DELHI; DATED : 07/11/2017 F{X~{T? P.S/. .. $#&' (' / COPY OF THE ORDER FORWARDED TO : 1. / / THE APPELLANT 2. 01/ / THE RESPONDENT. 3. 3 ( ) / THE CIT, DELHI 4. 3 / CIT(A)- , DELHI 5. 5 0 , , / DR, ITAT, DELHI 6. & / GUARD FILE. / BY ORDER, 15 0 //TRUE COPY// / (DY./ASSTT. REGISTRAR) , / ITAT, DELHI