VES Model Convent, Tavarekere V. Income Tax Officer, Exemptions, Ward- 2, Bangalore

ITA 679/BANG/2020

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 0019 (ITAT-BANGALORE)
• Duration Of Justice: 8 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-07-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 22-07-2021
• Assessment Year: 2016-2017
• Appeal Filed On: 29-10-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: N. SURESH
• Keywords: TDS
• Section: 22

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH : BANGALORE BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SMT. BEENA PILLAI , JUDICIAL MEMBER IT A NO. 679/BANG/2020 ASSESSMENT YEAR: 2016 - 17 VES MODEL CONVENT, TAVARREKERE VISHAL EDUCATION SOCIETY, 63, OLD SURVEY NO. 195/196, MAGADI MAIN ROAD, TAVAREKERE 562 130. PAN: AAATV 6531F VS. THE INCOME TAX OFFICER, EXEMPTION WARD 2, BANGALORE. APPELLANT RESPONDENT APPELLANT BY : S HRI DR . N. SURESH, CA RESPONDENT BY : SHRI KANNAN N ARAY ANAN, JT. CIT(DR), ITAT, BENGALURU. DATE OF HEARING : 22 . 07 .202 1 DATE OF PRONOUNCEMENT : 22 . 07 .202 1 O R D E R PER CHANDRA POOJARI, ACCOUNTANT MEMBER THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER DATED 31.8.2020 OF THE CIT(APPEALS), BENGALURU-14, BENGAL URU FOR THE ASSESSMENT YEAR 2016-17. 2. THE ASSESSEE HAS RAISED GROUND WITH REGARD TO DI SALLOWANCE OF SALARY PAID TO THE SPECIFIED PERSON AT RS.10,42,091 AS UNREASONABLE. 3. THE FACTS OF THE CASE ARE THAT THE ASSESSEE PAID AN AMOUNT OF RS.15,59,800 TO MRS. UMA SURESH AS REMUNERATION. S HE IS A SPECIFIED PERSON U/S. 13(2)(C) OF THE INCOME-TAX ACT, 1961 [T HE ACT] BEING SPOUSE OF ITA NO. 679/BANG/2020 PAGE 2 OF 9 THE TRUSTEE, MR. SURESH. SHE HAS BEEN WORKING AS A DMINISTRATIVE EMPLOYEE IN THE INSTITUTION. THE AO COMPARED HER SALARY WIT H THAT OF SRI S.V. NARASIMHA MURTHY WHO WAS PAID AT RS.5,17,709. ACCO RDINGLY THE AO WAS OF THE OPINION THAT SHE COULD NOT BE PAID RS.15,59, 800 COMPARED TO SRI S.V. NARASIMHA MURTHY WHO WAS PAID RS.5,17,709 AND DISALLOWED RS.10,42,091. THE SAME WAS SUSTAINED BY THE CIT(AP PEALS). AGAINST THIS, THE ASSESSEE IS IN APPEAL BEFORE US. 4. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE M ATERIAL ON RECORD. IT WAS BROUGHT ON RECORD AND THE ASSESSEE EXPLAINED THAT THE DUTIES AND RESPONSIBILITIES DISCHARGED BY SMT. UMA SURESH ARE ENTIRELY DIFFERENT FROM SRI S.V. NARASIMHA MURTHY, WHO WAS AN ORDINARY EMPL OYEE AND WAS TAKING INSTRUCTIONS FROM MRS. UMA SURESH. THE BRIEF PROFI LE, ROLES AND RESPONSIBILITIES OF SMT. UMA SURESH ARE AS FOLLOWS: - MRS. SUMA SURESH BRIEF PROFILE & ROLES AND RESPONSIBILITIES . HER BRIEF PROFILE IS GIVEN BELOW: COMPLETED B.COM IN THE YEAR 1994, PURSUED ICWAI IN THE SAME YEAR, HAS COMPLETED NIIT COMPUTER TRAINING. FROM 1996 TO 2001 SHE WORKED IN A CHARTERED ACCOUNTANTS OFFICE AS A SENIOR AUDIT ASSISTANT, WHE RE SHE GOT WELL VERSED WITH ACCOUNTANCY, BOOK KEEPING, TAX MATTERS, ADMINISTRATION & MANAGEMENT OF ORGANISATIO NS, ETC. FROM THE YEAR 2001 TO 2010 SHE WAS WORKING IN VES MODEL CONVENT AS AN ADMIN IN CHARGE ON AN HONORARY BASIS (WITHOUT EVEN TAKING A RUPEE SALARY, NOT ONLY THAT SHE WAS NOT CLAIMING EVEN THE CONVEYANCE) ITA NO. 679/BANG/2020 PAGE 3 OF 9 SHE IS THE ROOT CAUSE FOR THE GROWTH OF THE INSTITU TION FROM A VERY MEAGRE STRENGTH IN THE YEAR 2001 TO A CURREN T STRENGTH OF 913 STUDENTS. THE SCHOOL HAD 79 EMPLOYEES, DURING THE SAID YEAR BOTH TEACHING AND NON-TEACHING STAFF. TO MANAGE 913 STUD ENTS, 913 PARENTS AND 100+ EMPLOYEES AND COORDINATING WIT H THE STATUTORY EDUCATIONAL BODIES IS REALLY A HERCUL EAN TASK FOR ANYONE AND ONLY A PERSON, LIKE SMT.SUMA SURESH, WHO HAS SHEER PASSION TO SERVE CAN EFFICIENTLY AND EFFE CTIVELY HANDLE AND CAUSE SATISFACTORY RESULTS. DEDICATED HERSELF NEGLECTING THE WORKING HOURS FOR THE GROWTH BROUGHT THE INSTITUTION FROM RENTED PREMISES TO OWN NEW PREMISES. SHE HAS SACRIFICED HER PERSONAL L IFE AND FAMILY LIFE FOR THE SAKE OF SCHOOL AND FOR THE INTE REST OF THE STUDENTS. PROVIDES ADMINISTRATIVE GUIDANCE AND SUPPORT TO THE PRINCIPAL, TEACHERS, AND OTHER STAFF AND INCULCATES DISCIPLINE IN EACH AND EVERY ACT OF THE SCHOOL. ENSURES DISCHARGE OF QUALITY WORK FROM TEACHING STA FF TO AIM HIGH AND TO GET GOOD ACADEMIC RESULTS. COORDINATES WITH ACADEMIC BOARDS, GOVERNING BODIES, AND OTHER EDUCATIONAL DEPARTMENTS. DEALS WITH THE FEEDBACKS, QUERIES AND COMPLAINT PROCEDURES BOTH FROM PARENTS AND STAFF. COORDINATES THE EXAMINATION AND OTHER ACTIVITIES & PROCESSES. ASSISTS WITH RECRUITMENT AND MARKETING / PROMOTIONA L ACTIVITIES. MANAGE BUDGETS AND ENSURES FINANCIAL SYSTEMS ARE FOLLOWED. ITA NO. 679/BANG/2020 PAGE 4 OF 9 MAINTAINS ACCOUNTS OF THE SOCIETY, ENSURES THAT ALL THE STATUTORY PROVISIONS RELATING TO P. TAX, TDS, ESI, PF ETC ARE DULY COMPLIED WITH. COORDINATES WITH THE AUDITORS FOR AUDIT FINALISATIO N CAUSES TO FILE THE TDS RETURNS, I.T.RETURNS, ESI & PF RETURNS, P.TAX RETURNS, FILING OF ANNUAL RETURNS WI TH THE REGISTRAR OF FIRMS ETC ASSISTS THE MANAGEMENT IN ASSESSING THE REQUIREMENT OF AND IN DECISION MAKING FOR THE PURCHASE OF CAPITAL EQUIPMENT, FURNITURE AND OTHER NECESSITIES. HER INTERPERSONAL SKILLS HAVE HELPED US TO RETAIN G OOD TEACHERS. EVEN THOUGH THE SCHOOL IS SITUATED 20-25 KMS AWAY FROM BENGALURU, TEACHERS ARE WILLING TO WORK W ITH THE SCHOOL BECAUSE OF THE GOOD RAPPORT BETWEEN THE TEACHERS AND THE SCHOOL, CEMENTED THROUGH THE INTERPERSONAL SKILLS OF SMT.SUMA SURESH. IN HER LEADERSHIP, THE RESULTS ARE SPECTACULAR AND IN MANY YEARS THE SCHOOL HAS THE DISTINCTION OF GETTING 100 % RESULTS IN ICSE. DURING THE F.Y. 2015-16 ALSO, THE SCHOOL ACHI EVED 100% RESULTS IN ICSE AND 95% RESULT IN SSLC. THE WORK WILL BE CHALLENGING PARTICULARLY DURING TH E START OF THE ACADEMIC YEAR AND SMT.SUMA SURESH HANDLES EVERY THING WITH GREAT EASE. IN A NUTSHELL, SMT.SUMA SURESH, EVEN THOUGH SHE IS NOT DESIGNATED AS SUCH, HAS BEEN PERFORMING MULTIPLE TA SKS WHICH INTER ALIA INVOLVE THE DUTIES OF THREE EXECUT IVES: 1. CHIEF EXECUTIVE OFFICER 2. CHIEF FINANCE OFFICER AND 3. PUBLIC RELATIONS OFFICER. 5. THE DUTIES AND RESPONSIBILITIES OF SRI S.V. NARA SIMHA MURTHY ARE AS FOLLOWS:- ITA NO. 679/BANG/2020 PAGE 5 OF 9 CURRICULUM VITAE S.V. NARASIMHAMURTHY, 21/8, VI CROSS, I MAIN KENGERI SATELLITE TOWN, BANGALORE-60. EDUCATIONAL QUALIFICATION : B.A. PROFESSIONAL EXPERIENCE: LECTURER : BAPUJI INDEPENDENT PRE UNIVERSITY COLLEG E, BADAGANDI DUTIES AND RESPONSIBILITIES : 1. TEACHING ENGLISH LANGUAGE AND LITERATURE, COUNSE LING, COORDINATING WITH MANAGEMENT FOR SMOOTH FUNCTIONING OF THE COLLEGE, AND THE MANAGEMENT. 2. CONDUCTING EXAMINATIONS. 3. PREPARING TIMETABLE FOR THE DEPARTMENT OF ENGLIS H. ACADEMIC ACHIEVEMENTS 1. DESIGNING CURRICULUM FOR BUSINESS ENGLISH COMMUN ICATIONS 2. CONDUCTING EXAMINATIONS 3. PREPARING TIMETABLE FOR THE DEPARTMENT OF ENGLIS H. PERSONAL DETAILS: FULL NAME: SUBBAIAH VENKATESH NARASIMHA MURTHY DATE OF BIRTH : 06.07.1964 NATIONALITY : INDIAN GENDER : MALE MARITAL STATUS: MARRIED (RADHA V CURRENTLY WORKING AS A TEACHER) LANGUAGUES KNOWN: SPEAK READ WRITE ENGLISH ENGLISH ENGLISH KANNADA KANNADA KANNADA HINDI HINDI HINDI TELUGU ADDRESS : 21/8, VI CROSS, I MAIN, KENGERI SATELLITE TOWN, BANGALORE 560 060 . ITA NO. 679/BANG/2020 PAGE 6 OF 9 SALARY EXPECTED : NEGOTIABLE LIST OF REFERENCES: 1. SRI H B DHARMANNAVAR ADMINISTRATOR PATIL EDUCATION FOUNDATION. 2. MRS. SARADALAKSHMI PRINCIPAL, NARAYANA TECHNO SCHOOL. 6. THERE IS A VAST DIFFERENCE BETWEEN THE DUTIES AN D RESPONSIBILITIES PERFORMED BETWEEN THESE TWO PERSONS WHICH ARE AS FO LLOWS:- COMPARITIVE STATEMENT OF ACTIVITIES DONE BY MRS.SUM A SURESH & MR. S.V NARASIMHA MURTHY. ITA NO. 679/BANG/2020 PAGE 7 OF 9 ITA NO. 679/BANG/2020 PAGE 8 OF 9 7. BEING SO, IN OUR OPINION, THE SALARY PAID TO SMT . UMA SURESH CANNOT BE COMPARED WITH SRI S.V. NARASIMHA MURTHY AND THE DUTIES AND RESPONSIBILITIES DISCHARGED BY THESE TWO PERSONS AR E ENTIRELY DIFFERENT. SMT. UMA SURESH BEING WELL QUALIFIED WAS INCHARGE O F ENTIRE INSTITUTION AND PAYMENT OF SALARY SHOULD BE COMMENSURATE WITH HER Q UALIFICATION AND DUTIES DISCHARGED BY HER. BEING SO, THE SALARY PAI D TO HER AT RS.15,59,800 IS VERY REASONABLE AND THE LOWER AUTHORITIES ARE NO T JUSTIFIED IN INVOKING THE PROVISIONS OF SECTION 13(2)(C) OF THE ACT. THIS VI EW OF OURS IS ALSO FORTIFIED BY THE FOLLOWING JUDGMENTS:- CIT V. SRI BALAJI SOCIETY, 260 TAXMAN 246 (BOM) DY.CIT(E) V. JYOTI VIDYAPEETH TRUST DY. CIT(E) V. ST. XAVIER EDUCATIONAL & CHARITABLE T RUST DY. CIT V. WORLD INSTITUTE OF SUSTAINABLE ENERGY YOUNG SCHOLARS EDUCATIONAL V. ITO, 012 ITR (TRIB) 6 40 (CHD) 8. ACCORDINGLY, WE ALLOW THE GROUNDS TAKEN BY THE A SSESSEE. 9. IN THE RESULT, THE APPEAL BY THE ASSESSEE IS ALL OWED. PRONOUNCED IN THE OPEN COURT ON THIS 22 ND DAY OF JULY, 2021. SD/- SD/- ( BEENA PILLAI ) ( CHANDRA POOJARI ) JUDICIAL MEMBER ACCOUNTANT MEMBER BANGALORE, DATED, THE 22 ND JULY, 2021. / DESAI S MURTHY / ITA NO. 679/BANG/2020 PAGE 9 OF 9 COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT, BANGALORE. BY ORDER ASSISTANT REGISTRAR ITAT, BANGALORE.