PEC University of Technology Pension Fund Trust, Chandigarh V. DCIT Circle-1 Exemptions, Chandigarh

ITA 553/CHANDI/2019

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 6514 (ITAT-CHANDIGARH)
• Duration Of Justice: 9 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-01-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2014-2015
• Appeal Filed On: 24-04-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: M L SHARMA
• Keywords: Charitable institution; Revenue expenditure; Set aside
• Section: 12A; 12AA; 143(1); 154

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH, B, CHANDIGARH . . , , BEFORE SHRI N.K. SAINI, VICE PRESIDENT & SHRI SANJAY GARG, JUDICIAL MEMBER ./ ITA NO. 553/CHD/2019 / ASSESSMENT YEAR : 2014-15 PEC UNIVERSITY OF TECHNOLOGY PENSION FUND, COLLEGE BUILDING, PEC UNIVERSITY, ADMINISTRATIVE BLOCK, SECTOR 12, CHANDIGARH VS. ! THE DCIT , CIRCLE - 1 EXEMPTION, CHANDIGARH ' # ./ PAN NO: AACTP1935B '$/ APPELLANT &' '$ / RESPONDENT ()*+ /ASSESSEE BY : SHRI M.L. SHARMA, ADVOCATE *+ / REVENUE BY : SHRI MANJIT SINGH, CIT DR , -*) .# /DATE OF HEARING : 04.12.2019 /0 *) .# / DATE OF PRONOUNCEMENT : 27.01.2020 / ORDER PER SANJAY GARG, JUDICIAL MEMBER: THE PRESENT APPEAL HAS BEEN PREFERRED BY THE ASSESS EE THE ORDER DATED 30.01.2019 OF THE COMMISSIONER OF INCOME TAX -2, CHANDIGARH [HEREINAFTER REFERRED TO AS CIT(A)] UPHOLDING THE ACTION OF THE ASSESSING OFFICER / CPC IN REJECTION OF RECTIFICATI ON APPLICATION OF THE ASSESSEE MOVED U/S 154 OF THE INCOME TAX ACT, 1961 (IN SHORT 'THE ACT'). ITA NO. 553-CHD.-2019 PEC UNIVERSITY OF TECHNOLOGY PENSION FUND TRUST, CH ANDIGARH 2 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E TRUST IS AN IRREVOCABLE PENSION FUND TRUST CREATED ON 01.03.200 7 UNDER THE PEC UNIVERSITY OF TECHNOLOGY SOCIETY TO PROVIDE FOR THE OPERATION, CONTROL AND MAINTENANCE OF THE PENSION FUND OF THE EMPLOYEE S OF PEC UNIVERSITY OF TECHNOLOGY. THE SOLE PURPOSE OF THIS FUND IS TO MAKE PROVISION FOR THE PAYMENT OF PENSIONARY BENEFITS IN CLUDING FAMILY PENSION TO THE EMPLOYEES OF THE PEC UNIVERSITY OF T ECHNOLOGY. THE TRUST IS NOT REGISTERED U/S 12AA OF THE ACT. HOWEVE R, THE ASSESSEE TRUST FILED ITS RETURN OF INCOME TREATING IT TO BE A CHA RITABLE TRUST AND APPLICATION OF INCOME WAS CLAIMED AT RS. 2,22,49,62 9/- AS AGAINST THE DECLARED INCOME OF RS. 2,00,57,061/-. THE ASSESSING OFFICER / CPC DISALLOWED THE ENTIRE CLAIM OF THE APPLICATION OF I NCOME ON THE GROUND THAT THE ASSESSEE TRUST WAS NOT REGISTERED U/S 12A OF THE I.T. ACT, THEREFORE, ENTIRE GROSS RECEIPTS OF RS. 2,22,49,629 /- WERE ADDED BACK TO THE RETURNED INCOME OF THE ASSESSEE IN THE PROCEED INGS CARRIED OUT U/S 143(1) OF THE ACT. THEREAFTER, ASSESSEE MOVED A REC TIFICATION APPLICATION U/S 154 OF THE ACT PLEADING THAT EVEN IF THE ASSESS EE IS ASSESSED AS AN AOP, THE ASSESSEE MAY BE GRATED THE CLAIM OF REVEN UE EXPENDITURE WHICH HAS BEEN CLAIMED AS APPLICATION OF INCOME IN THE RETURN OF INCOME. HOWEVER, THE SAID APPLICATION WAS ALSO REJE CTED BY THE CPC. 3. BEING AGGRIEVED BY THE SAID ORDER OF THE CPC, TH E ASSESSEE FILED APPEAL BEFORE THE LD. CIT(A), HOWEVER, THE LD. CIT( A) ALSO DISMISSED ITA NO. 553-CHD.-2019 PEC UNIVERSITY OF TECHNOLOGY PENSION FUND TRUST, CH ANDIGARH 3 THE APPEAL OF THE ASSESSEE. HENCE, THE ASSESSEE HA S COME IN APPEAL BEFORE US. 4. THE LD. COUNSEL FOR THE ASSESSEE HAS SUBMITTED T HAT UNDER SIMILAR CIRCUMSTANCES, THE CLAIM OF THE EXPENDITURE HAS BEE N ALLOWED BY THE CPC FOR THE ASSESSMENT YEAR 2016-17 VIDE ORDER DATE D 26.9.2018, COPY OF THE ASSESSMENT ORDER HAS BEEN PLACED ON RECORD. WE FIND FORCE IN THE CONTENTION OF THE LD. COUNSEL FOR THE ASSESSEE THAT IF THE ASSESSEE HAS NOT BEEN TREATED AS A CHARITABLE TRUST, STILL THE I NCOME OF THE ASSESSEE IS TO BE ASSESSED AS PER THE NORMAL PROVISIONS OF THE ACT AND THE ADMISSIBLE REVENUE EXPENDITURE IS TO BE ALLOWED AGA INST THE INCOME OF THE ASSESSEE. IN VIEW OF THIS, THE IMPUGNED ORDER OF THE CIT(A) I S SET ASIDE, THE MATTER IS RESTORED TO THE FILE OF THE ASSESSING OFF ICER FOR DECIDING IT AFRESH, TREATING THE ASSESSEES INCOME AS AN AOP A ND CONSIDERING THE CLAIM OF THE ASSESSEE OF ALLOWABILITY OF EXPENDITUR E WHICH WAS INADVERTENTLY CLAIMED AS APPLICATION OF INCOME IN THE RETURN OF INCOME. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS TREATE D AS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 27.01.2020. SD/- SD/- ( . . / N.K. SAINI) ( ! / SANJAY GARG) '#$ / VICE PRESIDENT %& / JUDICIAL MEMBER DATED : 27.01.2020 .. ITA NO. 553-CHD.-2019 PEC UNIVERSITY OF TECHNOLOGY PENSION FUND TRUST, CH ANDIGARH 4 2*&)3454) / COPY OF THE ORDER FORWARDED TO : 1. '$ / THE APPELLANT 2. &' '$ / THE RESPONDENT 3. , 6) / CIT 4. , 6) ( )/ THE CIT(A) 5. 47 &)8 , . 8 , 9:;< / DR, ITAT, CHANDIGARH 6. ;= - / GUARD FILE 2 , / BY ORDER, > / ASSISTANT REGISTRAR