Ramarpan Education Society, Bhilwara V. Income Tax Officer, Exemption, Ajmer

ITA 862/JPR/2018

• Counselvise Citation: [2018] 124 COUNSELVISE.COM (IT) 9751 (ITAT-JAIPUR)
• Duration Of Justice: 2 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-09-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2014-2015
• Appeal Filed On: 03-07-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: J C KULHARI JCIT DHK
• Assessee Lawyers: RAHUL PARMANANDANI
• Keywords: Capital asset; Depreciation; Rectification of order; Reasonable cause; Capital receipt; Condonation of delay
• Section: 143(3); 12A; 12; 154; 11

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES, JAIPUR JH FOT; IKY JKO] U;KF;D LNL; ,OA JH FOE FLAG ;KNO ] YS[KK LNL; DS LE{K BEFORE: SHRI VIJAY PAL RAO, JM & SHRI VIKRAM SINGH YADAV, AM VK;DJ VIHY LA-@ ITA NO. 497/JODH/2017 FU/KZKJ.K O'KZ@ ASSESSMENT YEAR : 2014-15 RAMARPAN EDUCATION SOCIETY, 16-17, HEERA PANNA MARKET, PUR ROAD, GANDHI NAGAR, BHILWARA. CUKE VS. INCOME TAX OFFICER (EXEMPTIONS), AJMER. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: AAATP 5709 R VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT VK;DJ VIHY LA-@ ITA NO. 862/JP/2018 FU/KZKJ.K O'KZ@ ASSESSMENT YEAR : 2014-15 RAMARPAN EDUCATION SOCIETY, 16-17, HEERA PANNA MARKET, PUR ROAD, GANDHI NAGAR, BHILWARA. CUKE VS. INCOME TAX OFFICER (EXEMPTIONS), AJMER. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: AAATP 5709 R VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI RAHUL PARMANANDANI (CA) JKTLO DH VKSJ LS@ REVENUE BY : SHRI J.C. KULHARI (JCIT) LQUOKBZ DH RKJH[K@ DATE OF HEARING : 18/09/2018 MN?KKS'K.KK DH RKJH[K @ DATE OF PRONOUNCEMENT : 25/09/2018 VKNS'K@ ORDER PER: VIJAY PAL RAO, J.M. THESE TWO APPEALS BY THE ASSESSEE ARE DIRECTED AGAIN ST THE TWO SEPARATE ORDERS OF LD. CIT(A), AJMER DATED 06/09/201 7 & 10/05/2018 ARISING FROM THE ORDER PASSED U/S 143(3) AND SECTIO N 154 OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT) RESPECTIVELY FOR TH E A.Y. 2014-15. THE ITA 497/JU/2017 & 862/JP/2018_ RAMARPAN EDUCATION SOCIETY VS ITO(E) 2 ASSESSEE HAS RAISED COMMON GROUNDS IN BOTH THESE AP PEALS AND THE GROUNDS RAISED IN THE ITA NO. 862/JP/2018 ARISING F ROM THE ASSESSMENT ORDER PASSED U/S 143(3) OF THE ACT ARE REPRODUCED A S UNDER: 1. THAT THE LD. CIT(A) HAS GROSSLY ERRED IN CONFIR MING DISALLOWANCE OF FUNDS OF RS. 84,20,050/- I.E. CAPITAL RECEIPTS WHIC H IS QUITE ARBITRARY, UNJUSTIFIED, ILLEGAL AND NOT BASED ON FACTS. 2. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE, THE LD. CIT(A) HAS GROSSLY ERRED IN CONFIRMING DISALLOWANCE OF CLA IM OF DEPRECIATION OF RS. 35,69,684/- WHICH IS QUITE ARBITRARY, UNJUST IFIED, ILLEGAL AND NOT BASED ON FACTS. 3. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE, THE LD. CIT(A) HAS CONFIRMED DISALLOWANCES OF CLAIM OF INVESTMENT MADE IN THE FIXED ASSETS OF RS. 58,67,947/- WHICH IS QUITE ARBI TRARY, UNJUSTIFIED, ILLEGAL AND NOT BASED ON FACTS. 4. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE, THE LD. CIT(A) HAS GROSSLY ERRED IN CONFIRMING REJECTION OF CLAIM OF ACCUMULATE EXCESS APPLICATION OF RS. 59,97,636/- OF EARLIER YE ARS WHICH IS QUITE ARBITRARY, UNJUSTIFIED, ILLEGAL AND NOT BASED ON FA CTS. 5. THAT THE APPELLATE CRAVES LEAVE TO ADD, TO AMEND , MODIFY, RESCIND, SUPPLEMENT OR ALTER ANY OF THE GROUNDS STATED HEREI N ABOVE, EITHER BEFORE OR AT THE TIME OF HEARING OF THIS APPEAL. 2. THE ASSESSEE IS A SOCIETY AND PROVIDING EDUCATION . THE ASSESSEE WAS GRANTED REGISTRATION U/S 12A OF THE ACT. THE ASS ESSEE FILED ITS RETURN OF INCOME ON 20/09/2014 DECLARING AT NIL INCOME AFT ER CLAIMING BENEFIT OF SECTION 11 AND 12 OF THE ACT. DURING THE SCRUTINY A SSESSMENT PASSED U/S 143(3) OF THE ACT, THE ASSESSING OFFICER MADE DISAL LOWANCES ON ACCOUNT OF DONATIONS/CAPITAL RECEIPT, DEPRECIATION ON FIXED AS SETS, APPLICATION OF INCOME ACQUIRING THE FIXED ASSETS AND CLAIM OF EXCE SS APPLICATION OF ITA 497/JU/2017 & 862/JP/2018_ RAMARPAN EDUCATION SOCIETY VS ITO(E) 3 INCOME. THE ASSESSEE INSTEAD OF FILING AN APPEAL BEF ORE THE LD. CIT(A), PREFERRED RECTIFICATION PETITION U/S 154 OF THE ACT , WHICH WAS DISMISSED BY THE ASSESSING OFFICER VIDE ORDER DATED 20/01/2017. THEREAFTER THE ASSESSEE FILED AN APPEAL BEFORE THE LD. CIT(A) AGAIN ST THE ORDER PASSED U/S 154 OF THE ACT, WHICH WAS ALSO DISMISSED BY THE L D. CIT(A) VIDE ORDER DATED 06/09/2017 ON THE GROUND THAT THE ISSUE RAISE D BY THE ASSESSEE IN THE PETITION U/S 154 OF THE ACT ARE BEYOND THE PURV IEW OF THE PROVISIONS OF RECTIFICATION OF MISTAKES U/S 154 OF THE ACT. THE REAFTER THE ASSESSEE FILED SECOND APPEAL BEFORE THE LD. CIT(A) ON 27/09/ 2017 ALONGWITH AN APPLICATION FOR CONDONATION OF DELAY. THE LD. CIT(A) DISMISSED THE SAID APPEAL OF THE ASSESSEE IN LIMINI BEING BARRED BY LI MITATION VIDE IMPUGNED ORDER DATED 10/05/2018. THUS, THE ASSESSEE HAS FILED THESE TWO APPEALS AGAINST THE IMPUGNED ORDERS OF THE LD. CIT(A). 3. WE HAVE HEARD THE LD. AR AS WELL AS THE LD DR AND CONSIDERED THE RELEVANT MATERIAL ON RECORD. AS REGARDS THE ITA NO. 497/JODH/2017 ARISING AGAINST THE ORDER PASSED U/S 154 OF THE ACT, WE FIND THAT THE ASSESSEE RAISED TWO ISSUES IN THE PETITION FILED U/S 154 OF T HE ACT REGARDING THE ACQUISITION OF CAPITAL ASSET AND DEPRECIATION. THE L D. CIT(A) WHILE DECIDING THE APPEAL HAS HELD IN PARA 4.2 AS UNDER: 4.2 I HAVE GONE THROUGH THE ORDER, STATEMENT OF FA CTS, GROUNDS OF APPEAL AND WRITTEN SUBMISSION CAREFULLY. THIS APPEAL HAS B EEN FILED AGAINST THE ITA 497/JU/2017 & 862/JP/2018_ RAMARPAN EDUCATION SOCIETY VS ITO(E) 4 ORDER DATED 20.01.2017 PASSED U/S 154. IN THE APPLI CATION DATED 12.01.2016 FILED BY THE APPELLANT BEFORE THE AO, TH E APPELLANT HAD REQUESTED FOR DELETING THE FOLLOWING DISALLOWANCES MADE BY THE AO WHILE MAKING THE ASSESSMENT U/S 143(3) VIDE ORDER D ATED 16.11.2016: 1. DISALLOWANCE OF BOTH CLAIM OF PURCHASE OF CAPIT AL ASSETS AND DEPRECIATION. 2. DISALLOWANCE OF ACQUISITION OF CAPITAL ASSETS. 3. DISALLOWED DEPRECIATION ON BLOCK OF FIXED ASSET S. 4. DEPRECIATION OF ACQUISITION SHOULD BE ALLOWED. THE AO REJECTED THE APPLICATION OF THE APPELLANT O BSERVING THAT THE ISSUES RAISED BY THE ASSESSEE DO NOT COME UNDER THE PURVIEW OF THE PROVISIONS OF SECTION 154. MOREOVER THE ISSUE RAISED IN THE AP PLICATION U/S 154 ARE DEBATABLE. FURTHER, THERE IS NO PRIMA FACIE MISTAKE APPARENT FROM THE RECORD WHICH CAN BE RECTIFIED . I FULLY AGREE WITH THE OBSERVATION OF THE AO THAT THE ISSUE RAISED BY THE APPELLANT IN THE APPLICATIO N FILED U/S 154 ARE DEBATABLE IN NATURE. HENCE, BEYOND THE PURVIEW OF T HE PROVISIONS OF SECTION 154. THEREFORE, THE REJECTION OF APPLICATIO N BY THE AO OF THE APPLICATION FILED U/S 154 BY THE APPELLANT IS HELD TO BE JUSTIFIED AND IN ACCORDANCE WITH THE PROVISIONS OF LAW. HENCE, ALL T HE GROUNDS OF APPEAL ARE DISMISSED. HOWEVER, IT IS CLARIFIED THAT THE DI SMISSAL OF THE APPEAL AGAINST THE ORDER DATED 20.01.2017 PASSED U/S 154 W ILL NOT AFFECT THE OUTCOME OF THE APPEAL, IF ANY, FILED BY THE APPELLA NT AGAINST THE ORIGINAL ASSESSMENT ORDER DATED 16.11.2016. THUS, THE APPEAL OF THE ASSESSEE WAS DISMISSED BY THE LD. CIT(A) ON THE GROUND THAT THE ISSUE RAISED BY THE ASSESSEE IN THE PETITION FILED U/S 154 OF THE ACT ARE BEYOND THE SCOPE OF SECTION 154 AS T HERE IS NO PRIMA FACIE MISTAKE APPARENT FROM THE RECORD WHEN THE ASSESSING OFFICER HAS DECIDED THESE ISSUES AND DISALLOWED THE CLAIM OF THE ASSESSE E. ACCORDINGLY, WE DO NOT FIND ANY REASON TO INTERFERE WITH THE SAID ORDER DATED 06/9/2017 OF ITA 497/JU/2017 & 862/JP/2018_ RAMARPAN EDUCATION SOCIETY VS ITO(E) 5 THE LD. CIT(A) WHEN THE ISSUES REGARDING DISALLOWANCE S OF VARIOUS CLAIMS ARE SUBJECT MATTER OF THE ASSESSMENT PASSED U/S 143 (3) OF THE ACT AND A SEPARATE APPEAL HAS BEEN FILED AGAINST THE ASSESSME NT ORDER. HENCE, THE APPEAL FILED BY THE ASSESSEE ARISING FROM THE ORDER PASSED U/S 154 OF THE ACT IS DISMISSED. 4. AS REGARD THE APPEAL IN ITA NO. 862/JP/2018, WE F IND THAT THE LD. CIT(A) HAS NOT DECIDED THE APPEAL OF THE ASSESSEE ON MERITS BUT HAS DISMISSED THE SAME BY OBSERVING IN PARA 3 AND 4 AS UNDER: 3.0 THE APPELLANT HAS FILED AN APPLICATION DATED 1 0.05.2018 FOR CONDONATION OF DELAY IN FILING THE APPEAL STATING AS UNDER: MOST RESPECTFULLY, WE SUBMIT AS UNDER:- 1. THAT THE APPELLANT SEEKS CONDONATION OF DELAY IN FILING OF APPEAL. THE REASON FOR THE DELAY IS THAT THE APPELLANT HAS FILE D RECTIFICATION REQUEST UNDER SECTION 154 OF THE INCOME TAX ACT, 1961 AGAIN ST THE ORDER PASSED UNDER SECTION 143(3) OF THE ACT, THEREFORE THE DELA Y IS CAUSED IN FILING OF APPEAL. 2. THAT YOUR GOODSELF IS EMPOWERED U/S 249(3) OF TH E ACT TO CONDONE THE DELAY IN FILING APPEAL. IT IS, THEREFORE, MOST RESPECTFULLY PRAYED THAT TH E DELAY IN FILING THE APPEAL MAY VERY KINDLY BE CONDONED AND APPEAL BE KINDLY AD MITTED. 4.0 IT IS SEEN FROM FORM NO. 35 THAT DATE OF SERVIC E OF THE ORDER APPEALED : AGAINST IS 25.11.2016. THE APPEAL HAS BEEN FILED ON 27.09.2017. THUS, IT IS CLEAR THAT THE APPEAL HAS NOT BEEN FILED WITHIN THE PERIOD SPECIFIED U/S 249(2). AS PER SECTION 249(2), THE APPEAL HAS TO BE PRESENTED WITHIN 30 DAYS OF DATE OF SERVICE OF NOTICE OF DEMAND. THE AP PELLANT HAS NOT FILED ITA 497/JU/2017 & 862/JP/2018_ RAMARPAN EDUCATION SOCIETY VS ITO(E) 6 THE APPEAL WITHIN THE PERIOD SPECIFIED U/S 249(2). THERE IS AN INORDINATE DELAY IN FILING THE APPEAL. I HAVE GONE THROUGH THE APPLICATION FILED BY THE APPELLANT CAREFULLY. I AM SATISFIED THAT THE AP PELLANT DID NOT HAVE SUFFICIENT CAUSE FOR NOT PRESENTING THE APPEAL WITH IN THE PERIOD SPECIFIED U/S 249(2). THEREFORE, THE APPEAL IS DISMISSED AS N OT ADMITTED. THUS, THE LD. CIT(A) DECLINED TO CONDONE THE DELAY A LBEIT THE ASSESSEE HAS POINTED OUT THAT THE DELAY WAS DUE TO THE REASON THA T THE ASSESSEE IN THE MEAN TIME FILED RECTIFICATION PETITION U/S 154 OF T HE ACT AND ALSO FILED AN APPEAL AGAINST THE ORDER PASSED BY THE ASSESSING OF FICER U/S 154 OF THE ACT. WE FURTHER NOTE THAT AFTER THE APPEAL OF THE A SSESSEE AGAINST THE ORDER PASSED BY THE ASSESSING OFFICER U/S 154 OF TH E ACT WAS DISMISSED BY THE LD. CIT(A) VIDE ORDER DATED 06/9/2017 THE ASS ESSEE FILED AN APPEAL AGAINST THE ASSESSMENT U/S 143(3) OF THE ACT ON 27/ 09/2017 AND THEREAFTER THERE WAS NO UNREASONABLE DELAY IN FILING THE APPEAL AFTER THE DISMISSAL OF THE FIRST APPEAL FILED BY THE ASSESSEE . THOUGH, THERE WAS A DELAY IN FILING THE APPEAL BEFORE THE LD. CIT(A), HO WEVER, WHEN THE ASSESSEE HAS EXPLAINED CAUSE OF DELAY BEING THE TIM E CONSUMED IN THE PROCEEDINGS U/S 154 OF THE ACT AND THEREAFTER THE A PPEAL FILED BEFORE THE LD. CIT(A), WHICH WAS FINALLY DISMISSED VIDE ORDER DAT ED 06/09/2017 THEN IN OUR CONSIDERED OPINION, THE ASSESSEE HAD MADE OU T A GOOD CASE OF EXPLAINING THE DELAY IN FILING THE APPEAL. WHEN THE ASSESSEE HAS RAISED THE SAME ISSUE IN THE APPEAL FILED AGAINST THE ORDE R U/S 154 OF THE ACT, ITA 497/JU/2017 & 862/JP/2018_ RAMARPAN EDUCATION SOCIETY VS ITO(E) 7 WHICH WAS DISMISSED BY THE LD. CIT(A) ON TECHNICAL REA SON THAT THE ISSUE RAISED BY THE ASSESSEE IN THE PETITION U/S 154 WERE BEYOND THE SCOPE OF THE PROVISIONS OF SECTION 154 THEN THE APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER PASSED U/S 143(3) OF THE ACT OUGH T TO HAVE BEEN DECIDED ON MERITS AS ALL THE FACTS WERE ALREADY ON R ECORD AND IN THE KNOWLEDGE OF THE LD. CIT(A). WE FIND THAT THE REASON S FOR DELAY IN FILING THE APPEAL ARE MANIFEST FROM THE RECORD OF THE LD. CIT(A) ITSELF AS THE ASSESSEE HAS SPENT THIS TIME IN PURSUING THE ALTERN ATIVE REMEDY U/S 154 OF THE ACT, WHICH WAS DENIED BY THE LD. CIT(A). THEREF ORE, IN THE FACTS AND CIRCUMSTANCES OF THE CASE, THE APPEAL OF THE ASSESS EE FILED BEFORE THE LD. CIT(A) OUGHT TO HAVE BEEN DECIDED ON MERITS INSTEAD OF DISMISSING THE APPEAL ON TECHNICAL GROUND OF DELAY WHEN THE ASSESSE E HAS EXPLAINED THE REASONABLE CAUSE OF DELAY. HENCE, WE SATISFY WITH THE CAUSE OF DELAY EXPLAINED BY THE ASSESSEE BEING THE TIME CONSUMED I N THE PROCEEDINGS U/S 154 OF THE ACT. ACCORDINGLY, WE CONDONE THE DELA Y IN FILING THE APPEAL BEFORE THE LD. CIT(A). SINCE THE LD. CIT(A) HAS NOT A DJUDICATED THE GROUNDS RAISED BY THE ASSESSEE ON MERITS, THEREFORE , WE SET ASIDE THE MATTER TO THE RECORD OF THE LD. CIT(A) FOR ADJUDICAT ION OF THE APPEAL OF THE ASSESSEE ON MERITS NEEDLESS TO SAY THAT THE ASSESSE E BE GIVEN AN OPPORTUNITY OF HEARING BEFORE PASSING FRESH ORDER. ITA 497/JU/2017 & 862/JP/2018_ RAMARPAN EDUCATION SOCIETY VS ITO(E) 8 5. IN THE RESULT, APPEAL ITA NO. 497/JODH/2017 IS D ISMISSED AND APPEAL ITA NO. 862/JP/2018 IS ALLOWED FOR STATISTICA L PURPOSES ONLY. ORDER PRONOUNCED IN THE OPEN COURT ON 25/09/2018. SD/- SD/- FOE FLAG ;KNO FOT; IKY JKO (VIKRAM SINGH YADAV) (VIJAY PAL RAO) YS[KK LNL;@ ACCOUNTANT MEMBER U;KF;D LNL;@ JUDICIAL MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 25 TH SEPTEMBER, 2018 *RANJAN VKNS'K DH IZFRFYFI VXZSFKR @ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ @ THE APPELLANT- RAMARPAN EDUCATION SOCIETY, BHILWARA. 2. IZR;FKHZ @ THE RESPONDENT- THE ITO(E), AJMER. 3. VK;DJ VK;QDR @ CIT 4. VK;DJ VK;QDRVIHY @ THE CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ @ DR, ITAT, JAIPUR 6. XKMZ QKBZY @ GUARD FILE (ITA NO. 497/JU/2017 & 862/JP/2018) ` VKNS'KKUQLKJ @ BY ORDER, LGK;D IATHDKJ @ ASST. REGISTRAR