ACIT, (E), C-2, Chandigarh V. M/s Sanjiv Bansal Charitable Trust, Karnal

MA 9/CHANDI/2021

• Counselvise Citation: [2022] 104 COUNSELVISE.COM (IT) 5239 (ITAT-CHANDIGARH)
• Duration Of Justice: 9 month(s) 27 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 08-02-2022
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2016-2017
• Appeal Filed On: 12-04-2021
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Charitable institution; Tax effect; Tax effect
• Section: 11; 13

Judgement Text

आयकर अपील य अ धकरण,च डीगढ़ यायपीठ “बी” , च डीगढ़ IN THE INCOME TAX APPELLATE TRIBUNAL, CHANDIGARH BENCH “B”, CHANDIGARH (VIRTUAL COURT) ी एन.के .सैनी, उपा य! एवं ी स ु धांश ु ीवा&तव, या(यक सद&य BEFORE: SHRI. N.K.SAINI, VP & SHRI. SUDHANSHU SRIVASTAVA, JM Miscellaneous Application No. 09/Chd/2021 ( ITA No. 1528/Chd/2019) Assessment Year : 2016-17 The ACIT(E) C-2, Chandigarh M/s Sanjiv Bansal Charitable Trust Sanjiv Hospital, Railway Road, Karnal PAN NO: AAATS5445H Appellant Respondent ! " Assessee by : Shri Satish Kumar Goel,Advocate # ! " Revenue by : Dr. Ranjeet Kaur, Sr. DR $ % ! & Date of Hearing : 09/02/2022 '()* ! & Date of Pronouncement : 09/02/2022 आदेश/Order PER N.K. SAINI, VICE PRESIDENT This Miscellaneous Application has been filed by the department against the order dt. 03/12/2020 in ITA No. 1528/Chd/2019 for the A.Y. 2016-17. In this Miscellaneous Application the Department stated as under: 1. that on the facts & circumstances of the case, the Ld. CIT (A) has erred in law in allowing benefit of exemption under section 11 and in deleting the addition made on surplus amount without taking into consideration overall facts that the assessee was engaged in activities, which are (I) not as per its aims and objects of the trust; (II) not covered by section 2(15) of the Act defining 'charitable purpose'; (III) in violation to the exemptions provisions as per the Act benefitting the trustees; (IV) running on commercial lines with clear profit motives. 2. that on the facts & circumstances of the case, the Ld. CIT (A) has erred in law in deleting the addition amounting to Rs. 39,15,646/- despite the fact that the assessee is earning rental income in terms of 8% share in gross receipts from letting out the trust's building to a private hospital running a private hospital on commercial lines. 2 3. that on the facts & circumstances of the case, the Ld. CIT (A) has erred in law in deleting the addition amounting to Rs. 5,49,000/- despite the fact that the assessee has circumvented the provisions of section 13(l)(c) r.w. section 13(3) by earning same amount as rental income for the last 5 years from the concerns in which trustees are either partner/directors. 4. that on the facts & circumstances of the case, the Ld. CIT (A) has erred in law in deleting the addition amounting to Rs. 47,85,561/- despite the fact that the assessee has expended the amount of Rs. 47,85,561/- on construction and purchase of three bronze statues of its founders which is neither a charitable activity nor in accordance to the objects of the trust. 5. that the appellant craves to leave, add or amend any grounds of appeal on or before the appeal is heard or disposed of. The Hon'ble ITAT dismissed the appeal of the Department in ITA no. 1528/Chd/2019 dated 03.12.2020 as under: 2. During the course of hearing no body was present on behalf of the assessee, however the written submission had been furnished which is - place on the record. It is noticed that the appeal filed by the Department is not maintainable in view of the Circular No. 17/2019 dt. 08/08/2019 issued by CBDT wherein the monetary limit for filing the appeals by the Department before the ITAT has been increased to Rs. 50,00,000/-from Rs. 20,00,000/- 3. The Ld. Sr. DR Submitted that the Circular No. 17/2019 dt. 08/08/2019 is not clearly retrospective in as much as it specifically states in para 4 that " the said modification shall come into effect from the date of issue of this Circular". It was stated that the aforesaid sentence clearly gives an impression that the said Circular is applicable after the date mentioned there in and thereafter the departmental appeals which come in the specified tax effect limit will not be filed. 4. We have considered the submissions of the Ld. Sr. DR and carefully gone through the material available on the record. In the present case it is an admitted fact that the CBDT vide Circular No. 17/2019 enhanced the monetary limit to 50,00,000/- for not filing the appeal by the department before the ITAT, earlier this limit was specified at Rs. 20,00,000/- in the original Circular no. 03/2018dt. 11/07/2018. Now vide the new Circular no.17/2019 dt. 08/08/2019 in the Tax Effect limit has been enhanced and this Circular dt. 08/08/2019 read as under: ........ 6. Now the CBDT simply enhanced the monitory limit and the direction given earlier vide para nos. 12 & 13 of the Circular no. 3/2018 dt. 11/07/2018 are still intact which is crystal clear from the Circular no. 17/2019 wherein it has been mentioned that there is enhancement of monetary limit and amendment to Circular no. 3/2018 for reducing the litigation. We therefore are of the confirmed view that the amended Circular no. 17/2019 now issued by the CBDT is also applicable to the pending appeals as has been specified in para 13 of the original Circular 3 no. 03/2018 dt. 11.07.2018 and that the Department ought not have filed the appeals before the ITAT where the tax effect is Rs. 50 Lacs or less. For the aforesaid view we are also fortified by the decision dt. 14/08/2019 of the coordinate Bench i.e; ITAT, Ahmedabad Bench 'A' Ahmedabad in IT A No. 1398/Ahd/2004 for the A. Y. 1998 - 99 in the case of ITO, Ward 3(2) Ahmedabad Vs. Dinesh Madltavlal Patel, Ahmedabad & Others wherein it has been held in para 5 to 7 as under: 7. In view of the aforesaid discussion the appeal filed by the Department is dismissed." 7. The fact is that in Form 36 filed by the department the assessed income has erroneously been written as Rs. 52,03,671/- instead of Rs. l,50,36,036/-(column 7 of Form 36). Therefore, ITAT has adjudicated the case based on the tax effect as per the assessed income. However, the correct tax effect has been mentioned in Form 36 (column 10 of Form 36). 8. Apparent from the record, it is requested to It would be relevant to submit here that the case falls under exception of the para 10(b) of the CBDT's Circular No. 3 of 2018 and the tax effect is Rs. 52,03,671/- which is above the monetary limits prescribed by the CBDT's Circular No. 17/2019. 5 In view of the above, it is humbly prayed to kindly allow filing of Misc. Application and the dismissed appeal of the Department in ITA No. 1528/Chd/2019 for AY 2016-17 may be heard on merits. 6. The Misc. application is being filed as per the approval of the Commissioner of Income tax (Exemptions), Chandigarh vide letter No: 2687 dated 22.03.2021. 2. During the course of hearing the Ld. Sr. DR reiterated the contents of the aforesaid application and further submitted that the ITAT vide order dt. 03/12/2020 dismissed the appeal of the Department considering that the tax effect in this case was less than Rs. 50,00,000/- whereas the tax effect is of Rs. 52,03,671/-, therefore the mistake is apparent from the record and the order dt. 03/12/2020 may be recalled. 3. In his rival submissions the Ld. Counsel for the Assessee could not controvert the aforesaid contention of the Ld. Sr. DR, however submitted that the quantum of the tax effect was clearly mentioned in the submission of the respondent and the issue under consideration is squarely covered vide order of the ITAT pertaining to the preceding year i.e; 2015-16 in assessee’s own case therefore this order dt. 03/12/2020 may not be recalled. 4 4. We have considered the submissions of both the parties and perused the material available on the record. In the present case it is noticed that inadvertent and due to oversight the tax effect involved in the present case was considered as less than Rs. 50,00,000/- and the appeal of the Department was dismissed by keeping in view the Circular No. 17/2019 dt. 08/08/2019 issued by the CBDT which provides that the Department ought not to have filed the appeals where tax effect is less than Rs. 50,00,000/-. However the tax effect in this case is Rs. 52,03,671/- which is more than Rs. 50,00,000/-, therefore, the order dt. 03/12/2020 in ITA No. 1528/Chd/2019 for the A.Y. 2016-17 is recalled and the Registry is directed to fix the appeal for hearing on 08/03/2022. 5. In the result, Misc. Application filed by the Department is allowed. (Order pronounced in the open Court on 09/02/2022). Sd/- Sd/- स ु धांश ु ीवा&तव एन.के .सैनी, (SUDHANSHU SRIVASTAVA) ( N.K. SAINI) या(यक सद&य/ JUDICIAL MEMBER उपा य! / VICE PRESIDENT AG Date: 09/02/2022 ( + ! , - . - Copy of the order forwarded to : 1. The Appellant 2. The Respondent 3. $ / CIT 4. $ / 0 1 The CIT(A) 5. - 2 ग 4 5 & 4 5 678 ग9 DR, ITAT, CHANDIGARH 6. ग 8 : % Guard File ( + $ By order, ; # Assistant Registrar