ITO (Exemption), Udaipur V. M/s. Rajasthan Medicare Relief Society, Chittorgarh

ITA 54/JODH/2019

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 2202 (ITAT-JODHPUR)
• Duration Of Justice: 1 year(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-03-2020
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2015-2016
• Appeal Filed On: 25-02-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: K C BADHOK
• Keywords: Question of law
• Section: 142(1); 80G; 12AA; 10(23C); 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL JODHPUR BENCH, JODHPUR BEFORE SHRI R.C. SHARMA, ACCOUNTANT MEMBER AND SHRI SANDEEP GOSAIN, JUDICIAL MEMBER I.T.A. NO. 54/JODH/2019 (ASSESSMENT YEAR 2015-16) INCOME TAX OFFICER (EXEMPTION), UDAIPUR. VS M/S RAJASTHAN MEDICARE RELIEF SOCIETY, GENERAL HOSPITAL, CHITTORGARH. (APPELLANT) (RESPONDENT) PAN: AAATR 6171 M REVENUE BY SHRI K.C. BADHOK CIT - DR ASSESSEE BY NONE DATE OF HEARING 16/03/2020 DATE OF PRONOUNCEMENT 19/03/2020 O R D E R PER: SANDEEP GOSAIN, JM THIS IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER OF THE LD. CIT(A)-1, UDAIPUR DATED 20/11/2018 FOR THE A.Y.2015 -16. THE GROUNDS TAKEN BY THE REVENUE READS AS UNDER: '1. ON THE FACTS AND THE CIRCUMSTANCES OF THE CASE AND IN LAW THE LD.CIT(APPEALS) HAS ERRED IN ALLOWING THE CLAIM OF THE ASSESSEE FOR EXEMPTION U/S 10(23C)(IIIAC) OF THE IT ACT, 196 1 IGNORING THE CRUCIAL FACT THAT THE ASSESSEE NEITHER FILED A RETU RN ORIGINAL OR REVISED, CLAIMING EXEMPTION U/S 10(23C) (IIIAC) NOR CLAIMED SUCH EXEMPTION IN THE COURSE OF ASSESSMENT PROCEEDINGS & HENCE, IN VIEW OF THE DECISION OF THE SUPREME COURT IN GOETZE (INDIA) VS. CIT 284 ITR 323, THE CLAIM OF THE ASSESSEE U/S 10( 23C)(IIIAC) IS NOT SUSTAINABLE. 2 ITA 54/JODH/2019 ITO VS M/S RAJASTHAN MEDICARE RELIEF SOCIETY 2. ANY OTHER QUESTION OF LAW AS DEEMED FIT IN THE F ACTS AND CIRCUMSTANCES OF THE CASE MAY ALSO BE FRAMED BEFORE THE HONBLE TRIBUNAL IN THE INTEREST OF JUSTICE.' 2. NO BODY APPEARED ON BEHALF OF THE ASSESSEE IN SP ITE OF GIVING THE OPPORTUNITY, THEREFORE, THE BENCH DECIDED TO DISPOS E OFF THE APPEAL AFTER CONSIDERING THE CONTENTION OF THE LD. DEPARTMENTAL REPRESENTATIVE AND THE MATERIAL PLACED ON RECORD. 3. IN THIS APPEAL, THERE IS DELAY OF SEVEN DAYS IN FILING THE PRESENT APPEAL, FOR WHICH, AN APPLICATION FOR CONDONATION O F DELAY HAS ALSO BEEN FILED BY THE REVENUE. AFTER CONSIDERING THE CONTENT ION MADE IN THE CONDONATION PETITION, WE CONDONE THE DELAY AND HEAR D THE APPEAL ON MERIT. 4. THE ONLY GRIEVANCE OF THE REVENUE RELATES TO ALL OWING THE ASSESSEE FOR EXEMPTION U/S 10(23C)(IIIAC) OF THE INCOME TAX ACT, 1961 (IN SHORT, THE ACT). IN THIS REGARD, THE FACTS OF THE CASE, IN BRI EF, ARE THAT THE ASSESSEE IS A SOCIETY IN HEALTHCARE SPACE REGISTERED UNDER RAJAST HAN SOCIETIES REGISTRATION ACT, 1958. GOVERNMENT OF RAJASTHAN HAS OUTSOURCED MAINTENANCE OF DISTRICT HOSPITAL, CHITTORGARH TO TH E ASSESSEE SOCIETY. THE ASSESSEE SOCIETY IS ALSO ENTRUSTED WITH THE TASK OF EXECUTING VARIOUS HEALTHCARE SCHEMES FINANCED BY GOVERNMENT FROM TO T IME WHICH INCLUDE THE NATIONAL RURAL HEALTH MISSION OF THE GOVERNMENT OF INDIA. THE SOCIETY'S REVENUE COMPRISES GRANTS-IN-AID FROM CENTRAL AND ST ATE GOVERNMENTS, FEES FROM PATIENTS AND FIRMS FOR VARIOUS SERVICES AND DO NATIONS FROM 3 ITA 54/JODH/2019 ITO VS M/S RAJASTHAN MEDICARE RELIEF SOCIETY PHILANTHROPIC AGENCIES. THE ASSESSEE IS REGISTERED U/S 12AA AND HOLDS EXEMPTION U/S 80G OF THE ACT. THE ASSESSEE SOCIETY FILED ITS RETURN OF INCOME FOR THE YEAR UNDER CONSIDERATION ON 31-10-20 15 DECLARING TOTAL INCOME AT RS. NLL AND CLAIMING EXEMPTION U/S 11 OF THE ACT. THE AO ISSUED NOTICE U/S 142(1) OF THE ACT AND AFTER VERIFICATION OF BOOKS OF ACCOUNTS AND OTHER MATERIALS, AO ASSESSED THE INCOME OF THE ASSE SSEE AT RS. 77,60,420/- . 5. AGGRIEVED BY THE ORDER OF THE A.O., THE ASSESSEE PREFERRED APPEAL BEFORE THE LD. CIT(A), WHO AFTER CONSIDERING THE FA CTS AND MATERIAL PLACED ON RECORD ALLOWED THE APPEAL OF THE ASSESSEE BY OBS ERVING AS UNDER: ' 8. I HAVE CAREFULLY CONSIDERED THE OBSERVATION M ADE BY THE ASSESSING OFFICER, APPELLANT'S SUBMISSIONS, REMAND REPORT AND REJOINDE R TO THE REMAND REPORT SUBMITTED BY THE APPELLANT. THE AO MADE ADDITION AS PER SECTION 11(1)(A) OF THE ACT. THE APPELLANT CONTENDED THAT ITS INCOME IS EXEMPT U/S 10(23C)(IIIAC) OF THE ACT. THE AO WAS ASKED TO VERIFY WHETHER THE RECEIPTS FROM GOVERNMENT WERE IN EXCESS OF 50% OF THE TOTAL RECEI PTS. VIDE HIS REPORT DATED 31.08.2018, THE ASSESSING OFFICER HAS CONFIRMED AS UNDER:- ' THE SUPPORTING DOCUMENTS SUBMITTED BY THE LD. AR OF THE ASSESSEE DURING THE REMAND REPORT PROCEEDINGS HAVE BEEN EXAM INED AND IT IS FOUND THAT VARIOUS FUNDS ALLOTTED TO THE ASSESSEE B Y THE STATE/CENTRAL GOVERNMENT UNDER THE HEAD RCH, NRHM, JSY, SHUBHLAKS HMI YOJNA ETC. THE ASSESSEE EXPENDS THESE FUNDS AND AT THE END OF THE MONTH SUBMIT UTILITY CERTIFICATE SHOWING HEAD-WISE EXPENDITURE A ND BALANCE OUT OF FUNDS ALLOTTED BY THE GOVERNMENT. THESE VARIOUS GRA NTS/FUNDS RECEIVED BY THE ASSESSEE FROM THE STATE GOVERNMENT UNDER VAR IOUS SCHEMES ARE MORE THAN 50% OF THE TOTAL RECEIPTS OF THE ASSESSEE FOR THE YEAR UNDER CONSIDERATION. 4 ITA 54/JODH/2019 ITO VS M/S RAJASTHAN MEDICARE RELIEF SOCIETY CONSIDERING THE FACTS OF THE CASE AS ABOVE AND PROV ISIONS OF SECTION 10(23C) (IIIAC) OF THE ACT, IT IS CLEAR THAT THE APPELLANT IS SUBSTANTIALLY FUNDED BY THE GOVERNMENT AND, THEREFORE, IS ELIGIBLE FOR EXEMPTIO N U/S 10(23C)(IIIAC) OF THE ACT. THEREFORE, THE SAME IS ALLOWED. THUS, WITHOUT GOING INTO THE MERITS OF THE ADDITION MADE BY THE AO U/S 11(1)(A) OF THE ACT , THE SAME IS DELETED. THE GROUND RAISED BY THE APPELLANT REGARDING THIS ISSUE IS ALLOWED. 6. WE HAVE HEARD THE LD. CIT-DR AND PERUSED THE MA TERIAL AVAILABLE ON THE RECORD AND FOUND THAT THE LD. CIT(A) HAD ADJUDI CATED THE GROUND NOW RAISED BY THE REVENUE BEFORE US BY SEEKING AND RELY ING UPON THE REMAND REPORT. THEREFORE, CONSIDERING THOSE FACTS, THE LD. CIT(A) HAD RIGHTLY NOTED THAT THE ASSESSEE HAD SUBSTANTIALLY FUNDED BY THE G OVERNMENT AND IS ELIGIBLE FOR EXEMPTION U/S 10(23C)(IIIAC) OF THE AC T. HENCE, WE ALLOW THE CLAIM OF THE ASSESSEE. NO NEW FACTS OR CONTRARY JUD GMENTS HAVE BEEN PLACED ON RECORD BEFORE US IN ORDER TO CONTROVERT T HE FINDINGS SO RECORDED BY THE LD. CIT(A). THEREFORE, WE FIND NO REASON TO INTERFERE IN THE ORDER OF THE LD. CIT(A). HENCE, WE UPHOLD THE SAME. 7. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSE D. ORDER PRONOUNCED IN THE OPEN COURT ON 19 TH MARCH, 2020. SD/- SD/- (R.C. SHARMA) (SANDEEP GOSAIN) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED :19/03/2020 *RANJAN COPY TO : 1. THE APPELLANT 2. THE RESPONDENT 5 ITA 54/JODH/2019 ITO VS M/S RAJASTHAN MEDICARE RELIEF SOCIETY 3. THE CIT 4. THE CIT(A) 5. THE DR 6. GUARD FILE (ITA NO. 54/JODH/2019) ASSISTANT REGISTRAR JODHPUR BENCH