Ankleshwar Industrial Development Society, Bharuch V. The DCIT (Exemptions), HQ, Ahmedabad

ITA 74/SRT/2018

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 2759 (ITAT-SURAT)
• Duration Of Justice: 3 year(s) 8 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-10-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2014-2015
• Appeal Filed On: 05-02-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, SURAT BENCH, SURAT BEFORE SHRI PAWAN SINGH, JUDICIAL MEMBER AND DR. ARJUN LAL SAINI, ACCOUNTANT MEMBER ITA NO.74/SRT/2018 (AY 2014-15) (H EARING IN VIRTUAL COURT) ANKLESHWAR INDUSTRIAL DEVELOPMENT SOCIETY, C/O.JAYABEN MODY HOSPITAL,VALIA ROAD, GIDC, ANKLESHWAR, BHARUCH. GUJARAT 393002. PAN: AAATA 4648 Q VS THE DEPUTY COMMISSIONER OF INCOME TAX (EXEMPTION), HQ, AHMEDABAD. ASSESSEE / APPELLANT REVENUE /RESPONDENT ASSESSEE BY MISS ARTI N.SHAH CA REVENUE BY SHRI RITESH MISHRA CIT-DR DATE OF HEARING 20.10.2021 DATE OF PRONOUNCEMENT 20.10.2021 ORDER UNDER SECTION 254(1) OF INCOME TAX ACT PER PAWAN SINGH, JUDICIAL MEMBER: 1. THIS APPEAL BY ASSESSEE IS DIRECTED AGAINST THE ORDER OF LD. COMMISSIONER OF INCOME TAX (APPEALS)-7, AHMEDABAD [LD.CIT(A)], WHICH ARISES AGAINST THE ADDITIONS IN THE ASSESSMENT ORDER UNDER SECTION 143(3) OF THE INCOME TAX ACT, 1961 DATED 03.10.2017 FOR ASSESSMENT YEAR (AY) 2014-15. THE ASSESSEE RAISED FOLLOWING GROUNDS OF APPEAL: 1. THE LEARNED C.I.T.(APPEALS)-8, AHMEDABAD HAS ERRED IN LAW AND ON THE FACTS OF THE CASE IN CONFIRMING THE REJECTION BY THE LEARNED ASSESSING OFFICER OF CLAIM MADE BY THE APPELLANT THAT DONATIONS OF RS.2,07,67,475/- HAVE BEEN RECEIVED FOR SPECIFIC PURPOSE/ACTIVITIES, AND THEREFORE, COVERED U/S.11(1)(D) OF THE I.T.ACT, 1961 AND HENCE CANNOT BE INCLUDED IN THE INCOME OF THE APPELLANT. ITA NO.74/SRT/2018 FOR A.Y. 2014-15 ANKLESHWAR INDUSTRIAL DEVELOPMENT SOCIETY, BHARUCH 2 2. THE APPELLANT THEREFORE, PRAYS THAT DONATIONS OF RS.2,07,67,475/- BE HELD NOT INCLUDIBLE IN THE INCOME OF THE APPELLANT AS BEING RECEIVED FROM SPECIFIC PURPOSE/ACTIVITIES AS FORMING PART OF THE CORPUS AND THEREFORE COVERED BY PROVISIONS OF SECTION 11(1)(D) OF THE I.T.ACT, 1961. 3. YOUR APPELLANT PRAYS TO RESERVE THE RIGHT TO ADD, ALTER, AMEND OR WITHDRAW ANY OF THE ABOVE GROUNDS OF APPEAL. 2. AT THE OUTSET OF HEARING, THE LD. AUTHORISED REPRESENTATIVE (LD.AR) OF THE ASSESSEE SUBMITS THAT THE GROUNDS OF APPEAL RAISED BY ASSESSEE IS SQUARELY COVERED BY THE DECISION OF TRIBUNAL IN ASSESSEES OWN CASE FOR THE ASSESSMENT YEAR (A.Y.) 2012-13 IN ITA NO.854/AHD/2017 DATED 30.07.2018. THE LD.AR OF THE ASSESSEE BY REFERRING THE GROUNDS OF APPEAL AND THE ADDITIONS IN THE ASSESSMENT ORDER AND DECISION OF THE LD.CIT(A), INVITED OUR ATTENTION TO THE ORDER OF TRIBUNAL IN ASSESSEES OWN CASE FOR THE A.Y. 2012-13 AND SUBMITS THAT THERE IS NO VARIATION IN THE FACTS, EXCEPT THE FIGURE OF ADDITION. THE LD AR FOR THE ASSESSEE FURTHER SUBMITS THAT THE ASSESSING OFFICER (AO) WHILE MAKING THE ADDITION HELD THAT AS PER THE PROVISION UNDER SECTION 11(1)(D), THERE MUST BE CLEAR DIRECTION FROM THE DONOR THAT IT WILL FORM PART OF CORPUS, IN ORDER TO CLAIM THE EXEMPTION OF DONATION. AND THAT SIMILAR OBSERVATION WAS MADE BY AO IN AY 2012-13, THE TRIBUNAL BY CONSIDERING THE SIMILAR OBJECTIONS OF THE AO, ALLOWED RELIEF TO THE ASSESSEE. DURING THE FINANCIAL PERIOD UNDER CONSIDERATION THE ASSESSEE RECEIVED DONATION FROM THE SIMILAR PARTIES, AS RECEIVED IN FINANCIAL YEAR 2011-12. ITA NO.74/SRT/2018 FOR A.Y. 2014-15 ANKLESHWAR INDUSTRIAL DEVELOPMENT SOCIETY, BHARUCH 3 3. ON THE OTHER HAND, THE LD.CIT-DR FOR THE REVENUE AFTER GOING THROUGH THE ORDER OF CO-ORDINATE BENCH OF TRIBUNAL IN ASSESSEES OWN CASE IN ITA IN ITA NO.854/AHD/2017/SRT FOR THE A.Y.2012-13 SUBMITS THAT HE RELIED ON THE ORDER OF THE LD.CIT(A). 4. WE HAVE CONSIDERED THE SUBMISSION OF BOTH THE PARTIES AND AFTER GOING THROUGH THE LOWER AUTHORITIES AND THE ORDER PASSED BY THE CO-ORDINATE BENCH OF TRIBUNAL IN ASSESSEES OWN CASE IN ITA NO.854/AHD/2017/SRT (SUPRA), WE FIND THAT THERE IS NO VARIATION OF FACTS EXCEPT ADDITION OF FIGURE OF DISALLOWANCES UNDER 11(1)(D) OF THE ACT. WE FIND THAT ON SIMILAR FACTS, THE TRIBUNAL IN ASSESSEES OWN CASE PASSED THE FOLLOWING ORDER: 11. WE HAVE NOTED ABOVE, THE DONATIONS RECEIVED FROM LUPIM LTD., IT IS DISCERNABLE THAT IN THE RECEIPT ISSUED BY THE APPELLANT COMPANY (PAPER BOOK PG. 79) IT IS CLEAR THAT THE DONATION HAS BEEN RECEIVED BY THE ASSESSEE COMPANY FOR DEVELOPMENT AND EXTENSION OF MOBILE VAN PROJECT APPROVED BY NATIONAL COMMITTEE U/S. 35AC OF THE ACT. FURTHER, FROM THE COPY OF THE RECEIPT ISSUED TO MIRAJ IMAGING CENTRE PVT. LTD. DATED 11.05.2011 (ASSESSEE PAPER BOOK PG. 109) IT IS ALSO CLEAR THAT THE APPELLANT SOCIETY RECEIVED CORPUS FUND FOR DEVELOPMENT AND EXTENSION OF PROJECT AND THE SAME WAS DECLARED AS ELIGIBLE FOR TAX EXEMPT U/S. 80G(5) OF THE ACT. 12. THESE TWO SAMPLE CASES LEAVE NO DOUBT IN OUR MIND THAT THE IMPUGNED DONATIONS WERE RECEIVED BY THE APPELLANT SOCIETY FOR A SPECIFIC PURPOSES/ACTIVITIES AND THE PROJECT WAS APPROVED BY THE NATIONAL COMMITTEE OF CENTRAL GOVT. U/S. 35AC OF THE ACT. WE, THEREFORE, ARE OF THE OPINION THAT IMPUGNED DONATIONS, RECEIVED BY THE APPELLANT DURING THE RELEVANT PERIOD, HAVE BEEN RECEIVED FOR A SPECIFIC PURPOSES/ACTIVITIES AND THE SAME IS FORMING PART OF CORPUS FUND THEREFORE, COVERED BY PROVISION OF S. 11(1)(D) OF THE ACT AND HENCE, THE SAME IS EXEMPT AND CANNOT TREATED AS INCOME OF THE ASSESSEE ITA NO.74/SRT/2018 FOR A.Y. 2014-15 ANKLESHWAR INDUSTRIAL DEVELOPMENT SOCIETY, BHARUCH 4 FOR THE RELEVANT PERIOD. OUR CONCLUSION ALSO GETS STRONG SUPPORT FROM THE DECISION OF HON'BLE JURISDICTIONAL HIGH COURT IN THE CASES OF CIT VS. STHANAKVASI VARDHAMAN VANIK JAIN SANGH AND CIT VS. GUJARAT SAFAI KAMDAR VIKAS NIGAM(SUPRA). FINALLY, WE HOLD THAT THE AO WAS NOT CORRECT AND JUSTIFY IN DISMISSING THE CLAIM OF THE ASSESSEE AND LD. CIT(A) WAS NOT ALSO JUSTIFIED AND CORRECT IN UPHOLDING THE SAME AND HENCE, GROUND NO.1 & 2 OF THE ASSESSEE ARE ALLOWED AND THE AO DIRECTED TO DELETE THE ADDITION AS THE IMPUGNED DONATIONS ARE NOT INCLUDABLE IN THE INCOME OF THE ASSESSEE AS BEING RECEIVED FOR A SPECIFIC PURPOSE/ACTIVITY FORMING PART OF CORPUS AND THEREFORE, COVERED BY THE PROVISION OF S. 11(1)(D) OF THE ACT. 5. CONSIDERING THE AFORESAID FACTS AND THE DECISION OF THE TRIBUNAL IN ASSESSEES OWN CASE THERE IS NO VARIATION IN THE FACTS, THEREFORE, RESPECTFULLY FOLLOWING THE ORDER IN ASSESSEES OWN CASE, THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE IS ALLOWED WITH SIMILAR OBSERVATION. 6. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED. ORDER ANNOUNCED ON 20 TH OCTOBER, 2021 AT THE TIME OF HEARING IN VIRTUAL COURT HEARING. SD/- SD/- (DR ARJUN LAL SAINI) (PAWAN SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER SURAT, DATED: 20 /10/2021 / SGR* COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT(A) 4. CIT 5. DR 6. GUARD FILE BY ORDER / / TRUE COPY / / SR. PVT. SECRETARY, ITAT, SURAT