ACIT, Varanasi V. M/s Gramin & Sahari Vikas Shiksha Samiti, Varanasi

ITA 78/ALLD/2011

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 63360 (ITAT-ALLAHABAD)
• Duration Of Justice: 1 year(s) 6 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-11-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2006-2007
• Appeal Filed On: 21-04-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SANDEEP CHAUHAN
• Assessee Lawyers: ARVIND SHUKLA; O P SHUKLA
• Keywords: Search and seizure
• Section: 143(3); 12AA; 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, ALLAHABAD BENCH, ALLAHABAD BEFORE : SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI A.L. GEHLOT, ACCOUNTANT MEMBER ITA NO. 76, 77 & 78/ALLD./2011 ASSTT. YEAR : 2004-05, 2005-06 & 2006-07 A.C.I.T, CIRCLE-3, VS. M/S. GRAMIN & SAHARI VIKAS SHIKSHA SAMITI VARANASI. S-25/265-K, VRINDAVAN COLONY, SARSAUL I, VARANASI (PAN : AAATG 8602 Q) (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI SANDEEP CHAUHAN, CIT/DR RESPONDENT BY : S/SHRI ARVIND SHUKLA & O.P. SHUKLA , ADV. DATE OF HEARING : 06.11.2012 DATE OF PRONOUNCEMENT OF ORDER : 08.11.2012 ORDER PER BHAVNESH SAINI, J.M.: ALL THE APPEALS BY THE REVENUE ARE DIRECTED AGAIN ST DIFFERENT ORDERS OF LD. CIT(A), VARANASI DATED 30.10.2010 FOR THE ASSESSMEN T YEARS 2004-05, 2005-06 AND 2006-07. ALL THE GROUNDS ARE IDENTICAL IN ALL THE D EPARTMENTAL APPEALS AND THE LD. CIT(A) HAS MAINLY GIVEN FINDINGS IN ASSESSMENT YEAR 2006-07, WHICH IS FOLLOWED IN OTHER APPEALS FOR THE PURPOSE OF DELETING THE AD DITIONS. THEREFORE, FOR THE PURPOSE OF DISPOSAL OF THESE DEPARTMENTAL APPEALS, WE TAKE THE FACTS FROM ITA NO. 78/ALLD./2011. ITA NO. 76, 77 & 78/ALLD./2011 2 ITA NO. 78/ALLD./2011 (A.Y. 2006-07) : 2. IN THIS DEPARTMENTAL APPEAL, THE REVENUE CHALLEN GED THE DELETION OF ADDITION OF RS.30,71,650/- ON ACCOUNT OF INTRODUCTION OF THE CORPUS FUND AND ALSO CHALLENGED THE DELETION OF DISALLOWANCE OF VARIOUS EXPENSES IN A SUM OF RS.2,52,730/-. THERE WAS A SEARCH AND SEIZURE, COND UCTED IN THE CASE OF SHRI S.P. YADAV GROUP, WHICH IS STATED TO BE THE OFFSHOOT OF THE PRESENT PROCEEDINGS AGAINST THE ASSESSEE. THE ASSESSING OFFICER CONSIDERED THE ISSUE OF DONATIONS AND CORPUS FUND AND NOTED THAT THE ASSESSEE COULD NOT FILE EVI DENCE TO PROVE THE NATURE OF CORPUS FUND AND ACCORDINGLY, THE SAME WAS TAXED U/S . 68 OF THE IT ACT IN A SUM OF RS.31,71,650/- AS WELL AS EXCESS OVER INCOME AND EX PENDITURE WAS ALSO SUBJECTED TO TAX IN A SUM OF RS.2,52,730/-. BOTH THE ADDITION S WERE CHALLENGED BEFORE THE LD. CIT(A) AND IT WAS SUBMITTED THAT VOLUNTARY DONATION S ARE EXEMPT U/S. 11 OF THE IT ACT AND THE ASSESSEE FILED COMPLETE DETAILS. ALL TH E EXPENSES WERE INCURRED FOR ACHIEVING THE OBJECTS OF THE ASSESSEE. THE WRITTEN SUBMISSION OF THE ASSESSEE HAS BEEN INCORPORATED IN THE APPELLATE ORDER. THE ASSES SEE FURNISHED PAPER BOOK AND VOLUMINOUS DETAILS BEFORE THE LD. CIT(A), WHICH WER E ALSO FURNISHED BEFORE THE ASSESSING OFFICER DURING THE COURSE OF ASSESSMENT P ROCEEDINGS. ON THE ISSUE OF NON-PRODUCTION OF ACCOUNT BOOKS AND OTHER RELATED D ETAILS DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSEE HAS SUBMITTED ITS COMMENTS AGAINST THE ASSESSING OFFICERS COMMENTS WHICH ARE ALSO NOTED I N THE APPELLATE ORDER, IN WHICH THE ASSESSEE BRIEFLY EXPLAINED THAT THE ASSESSEE IS A PUBLIC CHARITABLE SOCIETY AND NO ITA NO. 76, 77 & 78/ALLD./2011 3 INCRIMINATING DOCUMENT WAS FOUND DURING THE COURSE OF SEARCH SO AS TO NEGATE OR CONTRADICT THE STATEMENT OF AFFAIRS AND OTHER DOCUM ENTS ALREADY FILED WITH THE DEPARTMENT. IT WAS SUBMITTED THAT THE ASSESSEE IS G RANTED REGISTRATION U/S. 12AA OF THE IT ACT BY THE CIT, VARANASI AND THEREFORE, INCO ME OF THE ASSESSEE IS EXEMPT U/S. 11 OF THE IT ACT. THE ASSESSEE AND HIS COUNSEL APPEARED BEFORE THE ASSESSING OFFICER TIME TO TIME AND MADE COMPLIANCE. IT IS SUB MITTED THAT THE ASSESSEE WAS TO REACH ALLAHABAD ON 24.12.2007 BUT DUE TO LOT OF TIM E TAKEN IN MAKING PHOTOCOPIES AND PRINTING OF THE DETAILS, WHICH WERE TO BE FURNI SHED, BUT DUE TO CHRISTMAS HOLIDAY ON 25.12,2007, THE SAME WERE FILED ON THE C OUNTER. THE JCIT, VARANASI HAS GIVEN WORDS ON 24.12.2007 TO THE SR. COUNSEL TH AT ALL THE SUBMISSIONS OF THE ASSESSEE WILL BE CONSIDERED. IT WAS SUBMITTED THAT SINCE THE ASSESSEE IS REGISTERED U/S. 12AA OF THE IT ACT, THEREFORE, INCOME OF THE A SSESSEE WOULD BE EXEMPT U/S. 11 OF THE IT ACT, WHICH HAS NOT BEEN PROPERLY DEALT WI TH BY THE ASSESSING OFFICER. IT WAS FURTHER SUBMITTED THAT VOLUNTARY CONTRIBUTIONS ARE EXEMPT U/S. 11(1)(D) OF THE IT ACT AND THESE PROVISIONS HAVE BEEN TOTALLY MISCO NSTRUED BY THE ASSESSING OFFICER. IT WAS SUBMITTED THAT GENUINENESS OF THE C ORPUS IS ESTABLISHED BECAUSE COMPLETE NAMES, ADDRESSES AND PARTICULARS WERE FURN ISHED ALONG WITH THE DECLARATION AND RECEIPTS ISSUES TO THE DONORS WHICH CLEARLY SPECIFY THAT DONATIONS/CORPUS FUND WERE RECEIVED TOWARDS THE COR PUS FUND ONLY AND WHICH HAVE BEEN UTILIZED FOR THE PURPOSE OF ACHIEVING THE OBJE CTS OF THE ASSESSEE SOCIETY. IT WAS, THEREFORE, SUBMITTED THAT BOTH THE ADDITIONS A RE UNJUSTIFIED. THE LD.CIT(A) ITA NO. 76, 77 & 78/ALLD./2011 4 CONSIDERING THE MATERIAL ON RECORD FOUND THAT THE A SSESSEE IS REGISTERED SOCIETY UNDER THE SOCIETIES REGISTRATION ACT AS WELL AS REG ISTERED WITH THE LD. CIT, VARANASI U/S. 12AA OF THE IT ACT AND APPROVAL HAS A LSO BEEN GRANTED U/S. 80G(5) OF THE IT ACT. THE LD. CIT(A) REFERRED TO SOME DECI SIONS IN RESPECT OF THE CONTENTION THAT THE REGISTRATION ONCE GRANTED CANNO T BE REVIEWED IN THE ASSESSMENT PROCEEDINGS. THE LD. CIT(A), THEREFORE, FOUND THAT THERE IS NO REASON TO SUSTAIN THE ORDER OF THE ASSESSING OFFICER IN DENYING TO GRANT EXEMPTION U/S. 11 AND 10(23C) OF THE IT ACT AND ACCORDINGLY, BOTH THE ADDITIONS W ERE DELETED. 3. THE LD. DR, RELIED UPON THE ORDER OF THE ASSESSI NG OFFICER AND SUBMITTED THAT THE ASSESSEE DID NOT FURNISH COMPLETE DETAILS BEFORE THE ASSESSING OFFICER WITH REGARD TO CORPUS FUND. THEREFORE, THE ADDITION SHOU LD NOT HAVE BEEN DELETED. HE HAS RELIED UPON THE ORDER OF THE ITAT, MUMBAI BENCH IN THE CASE REPORTED IN 50 ITD 135. ON THE OTHER HAND, THE LD. COUNSEL FOR THE ASS ESSEE REITERATED THE SUBMISSIONS MADE BEFORE THE AUTHORITIES BELOW AND RELIED UPON T HE ORDER OF ITAT, ALLAHABAD BENCH IN THE CASE OF ACIT VS. POORVANCHAL EDUCATION AL TRUST VS. ACIT IN ITA NO. 36/ALLD./2008 DATED 20.11.2008, IN WHICH ON IDENTIC AL FACTS, DEPARTMENTAL APPEAL HAS BEEN DISMISSED. HE HAS ALSO FILED COPY OF THE O RDER OF THE ASSESSING OFFICER IN THE CASE OF THE SAME ASSESSEE FOR SUBSEQUENT ASSESS MENT YEAR 2007-08 U/S. 143(3) DATED 14.05.2009, IN WHICH ON THE SAME FACTS, THE A SSESSING OFFICER ACCEPTED THE CLAIM OF THE ASSESSEE FOR EXEMPTION U/S. 11(1) OF T HE IT ACT. HE HAS ALSO PRODUCED ITA NO. 76, 77 & 78/ALLD./2011 5 AND SHOWN SEVERAL CERTIFICATES OF THE DONORS TO SHO W THAT THE CORPUS FUND/DONATIONS WERE GIVEN TO THE ASSESSEE FOR CORPUS FUND ONLY. 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND DO NOT FIND ANY JUSTIFICATION TO INTERFERE WITH THE ORDER OF THE LD. CIT(A) IN DE LETING BOTH THE ADDITIONS. IT IS NOT IN DISPUTE THAT THE ASSESSEE IS REGISTERED WITH THE CIT, VARANASI U/S. 12AA OF THE IT ACT, WHICH IS EFFECTIVE FOR THE ASSESSMENT YEAR UND ER APPEALS. THEREFORE, INCOME OF THE ASSESSEE WOULD BE EXEMPT U/S. 11 & 12 OF THE IT ACT. ACCORDING TO SECTION 11(1)(D), THE INCOME IN THE FORM OF VOLUNTARY CONTR IBUTION MADE WITH A SPECIFIC DIRECTION THAT THEY SHALL FORM PART OF CORPUS OF TH E TRUST OR INSTITUTION WOULD BE EXEMPT. THE ASSESSING OFFICER IN THE SUBSEQUENT ASS ESSMENT YEAR 2007-08 ON THE SAME FACTS ACCEPTED THE CLAIM OF THE ASSESSEE IN TH E SCRUTINY ASSESSMENT U/S. 143(3) OF THE IT ACT DATED 14.05.2009 (SUPRA). THE LD. COU NSEL FOR THE ASSESSEE DEMONSTRATED BEFORE US THAT THE ASSESSEE FURNISHED DECLARATION OF THE DONORS IN WHICH IT IS SPECIFIED THAT THE VOLUNTARY CONTRIBUTI ON HAVE BEEN MADE WITH THE ASSESSEE WITH SPECIFIC DIRECTION THAT THEY SHALL FO RM PART OF THE CORPUS OF THE ASSESSEE-SOCIETY. THE ASSESSEE HAS BEEN ABLE TO PRO VE BEFORE THE LD. CIT(A) THAT ALL THE PAPERS WERE FILED BEFORE THE ASSESSING OFFICER AT THE FAG END OF THE COMPLETION OF ASSESSMENT, THEREFORE, THEY WERE PART OF THE REC ORD OF THE ASSESSING OFFICER. THE LD. CIT(A) ON PROPER APPRECIATION OF LAW AND FACTS RIGHTLY HELD THAT BOTH THE ADDITIONS ARE TO BE DELETED BEING THE ASSESSEE ENTI TLED FOR EXEMPTION U/S. 11 AND ITA NO. 76, 77 & 78/ALLD./2011 6 10(23C) OF THE IT ACT. WE, THEREFORE, DO NOT FIND A NY INFIRMITY IN THE ORDER OF THE LD. CIT(A) IN DELETING BOTH THE ADDITIONS. THE DEPA RTMENTAL APPEAL FAILS AND IS DISMISSED. ITA NO. 76/ALLD./2011 (A.Y. 2004-05) ITA NO. 77/ALLD./2011 (A.Y. 2005-06) 5. IN BOTH THE APPEALS, THE REVENUE CHALLENGED THE DELETION OF ADDITION OF RS.17,95,200/- AND RS.25,77,600/- ON ACCOUNT OF COR PUS FUND IN BOTH THE ASSESSMENT YEARS AS WELL AS DELETION OF ADDITION OF DISALLOWANCE OUT OF VARIOUS EXPENSES IN A SUM OF RS.96,338/- AND RS.93,849/- RE SPECTIVELY. THE LD. CIT(A) FOLLOWED HIS ORDER FOR ASSESSMENT YEAR 2006-07 FOR THE PURPOSE OF DELETING BOTH THE ADDITIONS, IN WHICH WE HAVE ALREADY CONFIRMED THE O RDER OF THE LD. CIT(A). FOLLOWING THE REASONS FOR DECISION IN ASSESSMENT YE AR 2006-07, WE DISMISS BOTH THESE APPEALS OF THE REVENUE AS WELL. 6. IN THE RESULT, BOTH THE DEPARTMENTAL APPEALS ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- (A.L. GEHLOT) (BHAVNESH SAINI) ACCOUNTANT MEMBER JUDICIAL MEMBER *AKS/- ITA NO. 76, 77 & 78/ALLD./2011 7 COPY OF THE ORDER FORWARDED TO : 1. APPELLANT 2. RESPONDENT 3. CIT(A), CONCERNED BY ORDER 4. CIT, CONCERNED 5. DR, ITAT, ALLAHABAD 6. GUARD FILE ASSTT. REGISTRAR TRUE COPY