DDIT (E)-II(1), MUMBAI V. GHARDA FOUNDATION, MUMBAI

ITA 5768/MUM/2010

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 56148 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 5 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-12-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: G
• Next Hearing Date: 23-11-2011
• Assessment Year: 2007-2008
• Appeal Filed On: 16-07-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: A H DALAL
• Keywords: Charitable institution; Wholly owned subsidiary
• Section: 143(3); 12A; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH G, MUMBAI BEFORE SHRI P.M. JAGTAP, ACCOUNTANT MEMBER AND SHRI V. DURGA RAO, JUDICIAL MEMBER I.T.A. NO. 5768/MUM/2010 ASSESSMENT YEAR : 2007-08 DY. DIRECTOR OF INCOME-TAX(E), M/S GHARDA FOUNDATION, II(1), MUMBAI. VS. 5/6, JER MANSION, W.P. VARDE MARG, BANDRA (W), MUMBAI 400 050. PAN AAATG 0260C. APPELLANT. RESPONDENT APPELLANT BY : SHRI PAVAN VED. RESPONDENT BY: SHRI A.H . DALAL. DATE OF HEARING : 23-11-2011. DATE OF PRONOUNCEMENT : 23-12-2011. O R D E R. PER P.M. JAGTAP, A.M. : THIS APPEAL IS PREFERRED BY THE REVENUE AGAINST TH E ORDER OF LEARNED CIT(APPEALS)-1, MUMBAI DATED 31-03-2010 WHEREBY HE ALLOWED THE CLAIM OF THE ASSESSEE FOR EXEMPTION U/S 11. 2. THE ASSESSEE IN THE PRESENT CASE IS A CHARITABLE TRUST REGISTERED UNDER BOMBAY PUBLIC TRUST ACT, 1950. IT IS ALSO REGISTERE D UNDER THE PROVISIONS OF SECTION 12A OF THE INCOME-TAX ACT, 1961 ITS PRIMARY OBJECTS ARE PROMOTION OF RURAL DEVELOPMENT IN THE FIELD OF EDUCATION, HEALTH CARE, WOMEN EMPOWERMENT, POVERTY ALLEVIATION, AIDS PREVENTION, WATER CONSERVATION, F ORESTATION ETC. IN PURSUIT OF THE SAID OBJECTS, THE ASSESSEE HAS UNDERTAKEN PROJECT I N VARIOUS AIDED AND SELF 2 ITA NO.5768/MUM/2010 ASSESSMENT YEAR:2007-08. DEVELOPMENT PROGRAMMES WHICH INCLUDE INTER ALIA, ED UCATION, HEALTH CARE, WOMEN EMPOWERMENT, AIDS PREVENTION, WATER CONSERVATION, F ORESTATION ETC. IN THE RETURN OF INCOME FILED FOR THE YEAR UNDER CONSIDERATION, E XEMPTION U/S 11 WAS CLAIMED BY THE ASSESSEE IN RESPECT OF ITS ENTIRE INCOME. DURIN G THE COURSE OF ASSESSMENT PROCEEDINGS, THE CLAIM OF THE ASSESSEE FOR THE SAID EXEMPTION WAS EXAMINED BY THE AO AND ON SUCH EXAMINATION, HE RECORDED THE FOLLOWI NG FINDINGS/OBSERVATIONS : (A) IT IS NOT DENIED THAT M/S GUJARAT INSECTICIDE LTD. (HEREINAFTER REFER TO AS GIL) IS SPECIFIED PERSON BEING A 100% SUBSIDIARY OF GHARDA CHEMICALS LTD. IN WHICH DR. K.H. GHARDA IS HOLDING SUBSTANTIAL INTEREST IN THE COMPANY. (B) ADMITTEDLY AN ADVANCE OF RS.3,68,408/- IS GIVEN FREE OF INTEREST AND WITHOUT ANY ADEQUATE SECURITY TO GIL. (C) IT IS NOT DENIED THAT AN ADVANCE OF RS.3,61,783 /- REMAIN OUTSTANDING AGAINST GIL. IT IS FURTHER SEEN FROM THE COPY OF AC COUNT OF GIL IN THE BOOKS OF GHARDA FOUNDATION AS SUBMITTED DURING THE COURSE OF ASSESSMENT PROCEEDINGS THAT OPENING BALANCE OF ADVA NCE WAS RS.3,68,408.40 OUT OF WHICH ONLY SMALL EXPENDITURE OF RS.6,625/- HAS BEEN INCURRED BY GIL ON BEHALF OF GHARDA FOUNDATION RESULTING IN A OUTSTANDING BALANCE OF RS.3,61,783.40. THEREFORE, T HE PLEA OF THE ASSESSEE THAT THE AMOUNT WAS GIVEN TO GIL AS AN ADV ANCE FOR INCURRING EXPENDITURE ON BEHALF OF THE ASSESSEE IS BASELESS. AT ANY STRETCH OF IMAGINATION AND LOGIC IT IS NOT JUSTIFIABLE AS TO W HY FOR INCURRING SMALL EXPENDITURE OF RS.6,625/- AN AMOUNT OF RS.3,68,408. 40 WAS GIVEN ADVANCE AND RETAINED WITH GIL DURING THE YEAR. (D) THE CONTENTION OF THE ASSESSEE THAT THE AMOUNT GIVEN TO GIL FOR THE PURPOSE OF PROJECT RELATED EXPENSES IN NOT BACKED D OCUMENTARY EVIDENCE AND CANNOT BE RELIED UPON. EVEN OTHERWISE NOTHING PREVENTED ASSESSEE TO REIMBURSE GIL, THE EXPENSES I NCURRED BY THEM, IT ALL NOT BEHALF OF THE ASSESSEE AND AS SUCH THERE IS NO JUSTIFICATION OF SUCH ADVANCES AS ADMITTEDLY THE ANNUAL TURNOVER OF GIL EXCEEDS RS. 100 CRORES. ON THE BASIS OF ABOVE FINDINGS/OBSERVATIONS RECORDE D BY HIM, THE AO CAME TO THE CONCLUSION THAT ADVANCE OF RS.3,68,408/- GIVEN BY T HE ASSESSEE TO GIL WAS NOT IN 3 ITA NO.5768/MUM/2010 ASSESSMENT YEAR:2007-08. RELATION TO THE FULFILLMENT OF ITS OBJECT AS A TRUS T BUT IT WAS A CASE OF PLACEMENT OF THE FUNDS OF THE TRUST AT THE DISPOSAL OF GIL FREE OF INTEREST. HE HELD THAT THE INTENTION BEHIND THE SAID TRANSACTION WAS TO PROVID E DIRECT OR INDIRECT BENEFIT TO THE TRUSTEES WHO WERE SUBSTANTIALLY INTERESTED IN GIL. HE HELD THAT THE ASSESSEES CASE THUS WAS SQUARELY COVERED BY THE PROVISIONS OF SECT ION 13(1)(C) AND 13(2)(A) READ WITH SECTION 13(3)(E) AND IT WAS NOT ENTITLED TO CL AIM EXEMPTION U/S 11. ACCORDINGLY THE CLAIM OF THE ASSESSEE FOR EXEMPTION U/S 11 WAS REJECTED BY THE AO AND ITS TOTAL INCOME WAS ASSESSED BY HIM AT RS.4,82 ,17,742/- IN THE ASSESSMENT COMPLETED U/S 143(3) VIDE AN ORDER DATED 24-02-2009 . 3. AGAINST THE ORDER PASSED BY THE AO U/S 143(3), A N APPEAL WAS PREFERRED BY THE ASSESSEE BEFORE THE LEARNED CIT(APPEALS) AND TH E FOLLOWING SUBMISSIONS WERE MADE ON ITS BEHALF BEFORE THE LEARNED CIT(APPEALS) IN SUPPORT OF ITS CASE THAT THERE WAS NO VIOLATION OF THE PROVISIONS OF SECTION 13(1) (C) AND 13(2)(A) R.W.S. 13(3)(E) SO AS TO DENY ITS CLAIM FOR EXEMPTION U/S 11 : SEC. 13(3)(E) APPLIES ONLY IF, THE AUTHOR OR FOUN DER OF THE TRUST/INSTITUTION, IF AUTHOR OR FOUNDER IS A HUF, A MEMBER OF THE FAMI LY, TRUSTEE OR MANAGER OF THE TRUST/INSTITUTION, ANY RELATIVE OF SUCH AUTHOR/ FOUNDER, PERSON, MEMBER, TRUSTEE OR MANAGER WERE TO HOLD SUBSTANTIAL INTERES T IN THE COMPANY I.E. GIL BY HOLDING MINIMUM 20% OF THE VOTING POWER AS PROVI DED IN EXPLANATION 3(1). AS THE ENTIRE SHARE CAPITAL OF GIL IS HELD BY THE H OLDING COMPANY GLC, THE TRUSTEE, FOUNDER, ETC. AS SPECIFIED ABOVE CANNOT HO LD 20% OR MORE IN THE SHARE CAPITAL IN GIL. IN FACT NONE OF THE ABOVE PER SONS IS HOLDING A SINGLE SHARE IN GIL, AS THE ENTIRE SHARE CAPITAL IS HELD B Y GLC. HENCE THE PROVISIONS OF SEC. 13(3)(E) DO NOT APPLY TO GIL IN RELATION TO THE APPELLANT AND THEREFORE, ANY ADVANCE GIVEN T O GIL IS NOT CAUGHT WITHIN THE PURVIEW OF SEC. 13(2)(A) AND 13(1)(C). THE AO W AS THEREFORE, COMPLETELY WRONG IN HOLDING THAT THE APPELLANT HAD GIVEN BENEFIT TO A COMPANY FALLING UNDER SEC. 13(3)(E) READ WITH SEC. 13(2)(A) SO AS TO VIOLET SEC. 13(1)(C). 4 ITA NO.5768/MUM/2010 ASSESSMENT YEAR:2007-08. IV. THE POSITION WILL BE THE SAME REGARDING THE APP LICATION OF CLAUSE 13(2)(H) READ WITH 13(3)(E). FURTHER, COURTS HAVE H ELD THAT A LOAN OR ADVANCE TO A PERSON IS QUIET DIFFERENT FROM INVESTMENT IN T HE CAPITAL OF A COMPANY. SEE CIT V/S. NACHIMUTHU INDUSTRIAL ASSOCIATION 138 ITR 585 (MAD) ON PAGE 22-23 OF THE PAPER BOOK CONTAINING THE JUDGMENT. V. WITHOUT PREJUDICE TO THE ABOVE CONTENTION AND AS SUMING FOR THE SAKE OF ARGUMENT THAT SEC. 13(3)(E) WAS APPLICABLE, THE AMO UNT GIVEN TO GIL FOR THE PURPOSE OF CARRYING OUT THE PROJECT OF SAEP (STATES ADULT EDUCATION PROGRAMME) AND NACP (AIDS AWARENESS PROGRAMME) AND SWAHSHAKTI PROJECT REFERRED TO IN COMPANYS LETTER DATED 26.03 .2010 GIVING THE REASONS FOR THE DELAY IN THE EXECUTION OF THE PROJECT FOR WHICH ADVANCE IS GIVEN TO GIL, CANNOT BE CALLED AS ADVANCE OR LOAN WITHIN THE MEANING OF SEC. 13(2)(A), AS AN ADVANCE NORMALLY HAS TO BE RETURNED BY THE BORROWER WITH INTEREST AND THEREFORE, THE NECESSITY OF SECURITY A S REQUIRED BY SEC. 13(2)(A). VI. AS THE TRUST HAS NO ESTABLISHMENT OR SET UP IN ANKLESHWAR (GUJARAT), THE PROJECT WAS CARRIED OUT THROUGH GIL WHO DID NOT REC EIVE ANY BENEFIT FROM THE AMOUNT GIVEN TO IT FOR PROJECT EXPENDITURE. IT WAS A LARGE COMPANY WITH TURNOVER RS.100 CRORES. ON THE OTHER HAND THE TRUST WAS BENEFITED BY USING THEIR ESTABLISHMENT, STAFF, COMPUTERS, ETC. FOR CAR RYING OUT A PROJECT APPROVED BY GUJARAT GOVT. IT DID NOT CHARGE ANY AMOUNT TO TH E TRUST FOR THE WORK CARRIED BY IT. VII. WE HAVE SUBMITTED COPIES OF THE ACCOUNT OF GIL IN THE EARLIER YEARS 2004-05, 2005-06 DURING WHICH, ADVANCES OF LACS OF RUPEES (RS.------------- IN 2004-05 AND RS.5,65,037/- IN 2005-06) WERE GIVEN TO GIL FOR CARRYING OUT THE APPROVED PROJECT, WHICH WILL SHOW THE BONA FIDE OF THE NATURE OF THE ADVANCE GIVEN FOR CARRYING OUT THE PROJECT. WE ARE SUBMITTING HEREWITH THE PAPERS SHOWING THE APPROVAL OF THE PROJECT BY GUJAR AT GOVT. AND EXECUTION THEREOF THROUGH GIL IN THE EARLIER YEARS TO SHOW TH E NATURE OF THE CHARITABLE WORK CARRIED OUT BY THE APPELLANT. 4. THE LEARNED CIT(APPEALS) FOUND MERIT IN THE SUBM ISSIONS MADE ON BEHALF OF THE ASSESSEE AS ABOVE AND DIRECTED THE AO TO ALLOW THE CLAIM OF THE ASSESSEE U/S 11 FOR THE FOLLOWING REASONS GIVEN IN PARAGRAPH NOS. 6 .5 TO 6.9 OF HIS IMPUGNED ORDER : 5 ITA NO.5768/MUM/2010 ASSESSMENT YEAR:2007-08. 6.5 I HAVE CONSIDERED THE A.O.S ORDER AS WELL AS THE WRITTEN SUBMISSIONS OF THE APPELLANT AS DEPICTED ABOVE. HAVING CONSIDER ED BOTH, I AM OF THE CONSIDERED VIEW THAT THE A.O. HAS WRONGLY DENIED TH E EXEMPTION TO THE APPELLANT TRUST. AS PER THE APPELLANT SUBMISSION TH AT TRUSTEE MR. K.H. GHARDA WAS NO WHERE HAVING ANY SUBSTANTIAL INTEREST IN THE COMPANY I.E. GIL. ACTUALLY GIL IS 100% SUBSIDIARY OF GCL. AS THE GCL IS A PUBLIC LIMITED COMPANY AND THE COMPANY IS A PERSON WELL DEFINED IN THE IT ACT U/S 2(31)(III) OF THE IT ACT, HENCE ONLY GCL WAS HAVING SUBSTANTIAL INTEREST IN GIL AND NOT THE TRUSTEE MR. K.H. GHARDA. THUS, THE APPLICATION OF SECTION 13(1)(C) AND 13(2)(A) R.W.S. 13(3)(E) WAS WRONGLY A PPLIED BY THE A.O. 6.6 BESIDES THIS, THE APPELLANTS A/R ALSO ARGUED T HAT M/S GIL WAS ACTUALLY FACILITATOR AND PROVIDING ITS INFRASTRUCTU RE IN MANY WAYS FOR IMPLEMENTATION OF APPELLANTS TRUST DIFFERENT PROGR AMMES OF SAEP AND NACP IN THE AREA OF ANKLESHWAR (GUJARAT). THE COMPA NY GIL IS HAVING TURNOVER OF 100 CRORES, WHICH SOME TIME PROVIDES FA CILITIES WITHOUT ANY COMMERCIAL BENEFIT FOR IMPLEMENTATION OF THE OBJECT OF THE TRUST IN THE AREA. 6.7 I AM ALSO IN AGREEMENT WITH THE A/R THAT A SUM OF RS.3,68,408/- WAS NOT GIVEN AS A LOAN OR ADVANCE BUT WAS GIVEN FOR TH E CAUSE OF IMPLEMENTATION OF THE OBJECT OF THE TRUST. THE APPE LLANTS A/R ARGUED THAT GIL PROVIDED FACILITIES WITHOUT ANY CHARGE OR FINAN CIAL BENEFIT FROM TRUST IN THE IMPLEMENTATION OF DIFFERENT OBJECT OF THE TRUST . HENCE EVEN THE SUM WHICH WAS LYING AS CLOSING BALANCE OF RS.3,68,408/- IS NOT THE NATURE OF ADVANCE & LOAN. IT IS STATED BY THE APPELLANT IN PA RA-VII OF HIS SUBMISSION DATED 26/03/09 WE HAVE SUBMITTED COPIES SOF THE AC COUNT OF GIL IN THE EARLIER YEAR 2004-05 AND 2005-06, DURING WHICH ADVA NCES OF RS.5,34,558/- IN 2004-05 AND RS.7,68,533/- IN 2005-06), WERE GIVE N TO GIL FOR CARRYING OUT THE GUJARAT GOVERNMENT APPROVED PROJECTS. WHICH SHOWS A BONAFIDE NATURE OF ADVANCES GIVEN FOR CARRYING THE PROJECT. WE ARE SUBMITTING HEREIN WITH PAPERS SHOWING APPROVAL BY GUJARAT GOVT. AN AG GREGATION THEREOF THROUGH GIL IN EARLIER YEAR TO SHOW THE NATURE OF T HE CHARITABLE WORK CARRIED OUT BY THE APPELLANT TRUST. 6.8 THUS, THE PROJECTS WERE CARRIED OUT BY THE APPE LLANT TRUST THROUGH THE FACILITIES PROVIDED BY GIL FOR WHICH IT HAS NOT CHA RGED ANY AMOUNT TO THE APPELLANT. IT WAS ONLY DURING THE YEAR UNDER APPEAL THAT THE ADVANCE BROUGHT FORWARD FROM THE EARLIER YEAR WAS RS.3,68,408/- WAS NOT UTILIZED FOR THE PROJECT EXCEPT AN AMOUNT OF RS.6,625/- FOR THE REAS ONS SHOWN BY THE APPELLANT IN THEIR LETTER DATED 26/03/2010 DETAILIN G THE REASONS OF NON AVAILABILITY OF THE FIELD STAFF REQUIRED FOR EXECUT ION OF THE PROJECT AND OTHER 6 ITA NO.5768/MUM/2010 ASSESSMENT YEAR:2007-08. REASONS THAT THE AMOUNT WAS CARRIED FORWARD AS AN A DVANCE AND FINALLY SPENT FOR THE CHARITABLE PROJECT IN THE SUBSEQUENT FINANC IAL YEAR. I ALSO FIND THAT EVEN THE JUDGEMENT CITED BY THE A.O. IN THE CASE OF KANAHYA LAL PUNJ CHARITABLE TRUST VS. DIT(E) [2008] 171 TAXMAN 124 ( DELHI) CAN BE DISTINGUISHED FROM THE FACTS OF THE APPELLANT CASE AS IN THAT CASE, IT COULD NOT BE DENIED THAT THE BENEFIT HAS DIRECTLY OR INDIRECT LY REACHED THE INTERESTED PERSONS NAMELY P AND THUS THERE IS A CLEAR VIOLAT ION OF SECTION 13(1)(C) AND 13(2)(A) OF THE IT ACT. IN THE APPELLANT CASE THE A DVANCES FROM YEAR TO YEAR FOR EXECUTION OF THE PROJECT THROUGH GIL AS SHOWN B Y THE APPELLANT CANNOT BE CONSIDERED AS LOANS AND ADVANCES GIVEN TO GIL AS IT WAS GIVEN TO GIL TO REIMBURSE FOR THE EXPENSES INCURRED TOWARDS THE PRO JECT RUN BY THE APPELLANT TRUST. 6.9 CONSIDERING ALL THESE FACTS BROUGHT BEFORE ME, I AM OF THE CONSIDERED VIEW THAT THE A.O. HAS WRONGLY INVOKED THE PROVISIO NS OF SECTION 13(1)(2) AND 13(2)(A) R.W.S. 13(3)(E) OF THE IT ACT, 1961, AS ON THE BASIS OF AFORESAID DISCUSSION IT IS EVIDENT THAT THE APPELLANT HAS NOT CONTRAVENED THE PROVISIONS OF SECTION 13(1)(C) AND 13(2)(A) R.W.S. 13(3)(E) OF THE IT ACT, 1961. ACCORDINGLY I CONSIDER IT PROPER AND APPROPRIATE TO DIRECT THE A.O. TO ALLOW THE EXEMPTION U/S 11 TO THE APPELLANT TRUST. I ALSO INTEND TO MENTION THAT THE APPELLANT IS HAVING A VALID REGISTRATION U/S 12A GR ANTED BY DIT(E) AND THEREFORE THE A.O. SHOULD ALLOW THE EXEMPTION U/S 1 1 OF THE IT ACT TO THE APPELLANT TRUST. AGGRIEVED BY THE ORDER OF THE LEARNED CIT(APPEALS), THE REVENUE HAS PREFERRED THIS APPEAL BEFORE THE TRIBUNAL. 5. WE HAVE HEARD THE ARGUMENTS OF BOTH THE SIDES AN D ALSO PERUSED THE RELEVANT MATERIAL ON RECORD. IT IS OBSERVED THAT THE ASSESSE E IN THE PRESENT CASE IS A TRUST WHICH IS ADMITTEDLY ENGAGED IN CARRYING OUT CHARITA BLE ACTIVITIES. IT IS ALSO REGISTERED U/S 12A OF THE INCOME-TAX ACT. IN THE RE TURN OF INCOME FILED FOR THE YEAR UNDER CONSIDERATION, THE ASSESSEE CLAIMED EXEMPTION U/S 11 ON THE STRENGTH OF NATURE OF ITS ACTIVITY BEING CHARITABLE AS WELL AS THE REGISTRATION GRANTED TO IT U/S 12A. THIS BASIS ON WHICH EXEMPTION U/S 11 WAS CLAIM ED BY THE ASSESSEE WAS NOT DISPUTED BY THE AO. HE, HOWEVER, DENIED THE CLAIM O F THE ASSESSEE FOR EXEMPTION U/S 11 ON THE GROUND THAT THE SUM OF RS.3,68,408/- ADVANCED BY THE ASSESSEE TO 7 ITA NO.5768/MUM/2010 ASSESSMENT YEAR:2007-08. GIL WAS HIT BY THE PROVISIONS OF SECTION 13(1)(C) A ND 13(2)(A) READ WITH SECTION 13(3)(E) AS, ACCORDING TO HIM, THE SAID ADVANCE WAS GIVEN TO BENEFIT GIL IN WHICH THE TRUSTEES OF THE ASSESSEE TRUST WERE SUBSTANTIAL LY INTERESTED. BEFORE THE LEARNED CIT(APPEALS), IT WAS EXPLAINED BY THE ASSESSEE THAT THE DIFFERENT PROJECTS WERE UNDERTAKEN BY IT IN PURSUIT OF ITS CHARITABLE OBJEC TS IN ANKLESHWAR, GUJARAT AND SINCE THE ASSESSEE TRUST DID NOT HAVE ANY OFFICE OR BASE IN ANKLESHWAR, GUJARAT OR ANY FULL TIME EMPLOYEES WORKING THERE, THE OFFICE P REMISES AND OTHER FACILITIES OF GIL AVAILABLE THERE WERE BEING USED BY IT. IT WAS S UBMITTED THAT GIL WAS GOOD ENOUGH TO EXTEND ALL FACILITIES TO THE ASSESSEE WIT HOUT CHARGING ANY COMPENSATION KEEPING IN VIEW OVER ALL CORPORATE SOCIAL RESPONSIB ILITY AND IN ORDER TO MEET THE EXPENSES INCURRED BY THE SAID COMPANY ON BEHALF OF THE ASSESSEE TRUST, A LUMPSUM AMOUNT WAS DEPOSITED BY THE ASSESSEE WITH THE SAID COMPANY. IT WAS POINTED OUT THAT THE EXPENSES INCURRED BY THE SAID COMPANY ON B EHALF OF THE ASSESSEE DURING THE EARLIER YEARS AS WELL AS IN THE SUBSEQUENT YEARS WE RE MET OUT OF THE AMOUNT DEPOSITED BY THE ASSESSEE TRUST WITH THE SAID COMPA NY. IT WAS ALSO POINTED OUT THAT EVEN IN THE YEAR UNDER CONSIDERATION, ONE PAYMENT M ADE BY GIL ON BEHALF OF THE ASSESSEE TRUST WAS ADJUSTED AGAINST THE SAID DEPOSI T AND SINCE THERE WAS NO MUCH ACTIVITY OF THE TRUST IN ANKLESHWAR, GUJARAT IN THE YEAR UNDER CONSIDERATION, THE OPENING BALANCE OF DEPOSIT CONTINUED TO REMAIN WITH GIL AFTER ADJUSTMENT OF THE SAID AMOUNT OF RS.6,625/- PAID ON ITS BEHALF BY GIL IN THE YEAR UNDER CONSIDERATION. KEEPING IN VIEW ALL THESE SUBMISSION S MADE ON BEHALF OF THE ASSESSEE BEFORE THE LEARNED CIT(APPEALS) AND REITER ATED BEFORE US AT THE TIME OF HEARING, WE AGREE WITH THE CONCLUSION DRAWN BY THE LEARNED CIT(APPEALS) THAT THE AMOUNT IN QUESTION WAS GIVEN BY THE ASSESSEE TO GIL IN THE COURSE OF CARRYING OUT OF ITS CHARITABLE ACTIVITIES AND IT WAS NOT A CASE OF ANY LOAN OR ADVANCE GIVEN BY THE ASSESSEE TO GIL FOR THE LATTERS BENEFIT SO AS TO A TTRACT THE PROVISIONS OF SECTION 8 ITA NO.5768/MUM/2010 ASSESSMENT YEAR:2007-08. 13(1)(C) AND 13(2)(A) READ WITH SECTION 13(3)(E). W E, THEREFORE, FIND NO INFIRMITY IN THE IMPUGNED ORDER OF THE LEARNED CIT(APPEALS) DIRE CTING THE AO TO ALLOW THE EXEMPTION CLAIMED BY THE ASSESSEE U/S 11 AND UPHOLD ING THE SAME, WE DISMISS THIS APPEAL FILED BY THE REVENUE. 6. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 23 RD DAY OF DEC.,2011. SD/- SD/ - (V. DURGA RAO) (P.M. J AGTAP) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI, DATED : 23 RD DEC., 2011. COPY TO : 1. APPELLANT 2. RESPONDENT 3. C.I.T. 4. CIT(A) 5. DR, G-BENCH. 6. GUARD FILE. (TRUE COPY ) BY ORDER ASSTT. REGISTRAR, ITAT, MUMBAI. WAKODE