Young Men's Christian Association, CHENNAI V. JCIT (OSD), CHENNAI

MA 94/CHNY/2013

• Counselvise Citation: [2013] 124 COUNSELVISE.COM (IT) 0784 (ITAT-CHENNAI)
• Duration Of Justice: 2 month(s) 30 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 26-08-2013
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 26-07-2013
• Assessment Year: 2009-2010
• Appeal Filed On: 27-05-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: S DASGUPTA
• Assessee Lawyers: K M MOHANDASS
• Keywords: Unexplained cash credit
• Section: 27; 54; 11; 68; 12

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, CHENNAI BEFORE SHRI ABRAHAM P.GEORGE, ACCOUNTANT MEMBER AND SHRI CHALLA NAGENDRA PRASAD, JUDICIAL MEMBE R M.P. NOS. 93 TO 95/MDS/2013 (IN ITA NOS.294, 1888 & 2004/MDS/2012) ( ASSESSMENT YEARS : 2008-09 & 2009-10) M/S. YOUNG MENS CHRISTIAN ASSOCIATION, 223, NSC BOSE ROAD, ESPLANADE, CHENNAI-1. PAN: AAATY0296N VS. JOINT COMMISSIONER OF INCOME TAX(OSD), (EXEMPTIONS) II AAYAKAR BHAVAN, ANNEXE BUILDING 3 RD FLOOR, CHENNAI-34. (APPLICANT) (RESPONDENT) APPLICANT BY : MR. K.M.MOHANDASS, C.A. RESPONDENT BY : MR. S.DASGUPTA, JCIT DATE OF HEARING : 26 TH JULY, 2013 DATE OF PRONOUNCEMENT : 26 TH AUGUST, 2013 O R D E R PER CHALLA NAGENDRA PRASAD, JM: ALL THESE MISCELLANEOUS PETITIONS WERE FILED BY THE ASSESSEE POINTING OUT CERTAIN MISTAKES SAID TO HAV E OCCURRED AND REQUESTS FOR RECTIFICATION. IN NONE OF THESE M ISCELLANEOUS PETITIONS, THE ASSESSEE HAS REQUESTED FOR RECALLING THE EX-PARTE ORDER PASSED BY THIS TRIBUNAL FOR GIVING A DEQUATE OPPORTUNITY OF HEARING TO THE ASSESSEE. M.P.NO.93 TO 95 /MDS/2013 2 MISC. PETITION NOS.93 & 95/MDS/2013: 2. IN THE ABOVE TWO MISCELLANEOUS PETITIONS, THE A SSESSEE STATES THAT THERE ARE CERTAIN MISTAKES IN PASSING T HE ORDER BY THIS TRIBUNAL AND SUBMITS AS UNDER:- 3. IN PAR A 5 O F TH E O RD E R , AT PAGE N O 7 I T I S OB SE R VE D THAT ' THE COMMI SS ION E R OF INCOME TA X (A PP E AL S ) H E LD THAT TH E R E NT A L INCOM E D E RI VE D B Y TH E A S S ESSEE IS ONL Y A PROPERTY INCOME OF TH E ASSESSEE A SS E SS ABLE UNDER TH E HEAD ' INC O M E FR O M HOU S E PROPERT Y A ND NOT UNDER THE HEAD ' BU S INE SS INCOME .' 3.1 . IN THE IMPUGNED ORDER OF THE CIT ( APP E AL S ) IN NO . ITA 453 / 2011-12 DATED 23.07.2012 , IN PAR A 3 A T THE END OF PAGE NO.14 AND CONTINUED A T THE BEGINNING OF P A GE NO . 15 , THE LEARNED C IT H A S HELD- ' WH E RE AS IN THE IN S TANT CA S E THERE IS N O BU S IN ESS ACTIVITY CARRIED ON B Y THE A S SESSEE WHOS E IN CO M E I S SE PARATEL Y CHARGEABLE TO T A X UND E R TH E R E GULAR PROVISION S OF THE ACT AND HENC E TH E QU ES TI O N OF MAINTAINING S EPARATE BOOK S OF BO O K S O F ACCOUNTS U / S 11(4A ) O F THE ACT DO ES NOT A R ISE . F URTH E R , A S NOT E D IN THE PRECEDIN G P A R A GR A PH THE AS S ES S EE 'S ACTI V IT Y OF LETTING OUT TH E P R O P E RTI ES IS AS P E R THE OBJECTS OF TH E SOC I E T Y A ND WILL NOT CON S TITUT E TH E BU S INESS ACTIVIT Y . T H E R EF OR E TH E ASSESS ING OFFI C ER ' S CON TE NT IO N THAT TH E A SS E S SEE I S REQUIR E D T O MAINTAIN S EPAR A T E BOO K S O F ACC O UNT S U / S 11 ( 4A ) OF THE AC T IS UN FO UND E D. HENCE THI S CONT E NTI O N OF TH E A SSESS IN G OFF IC E R I S NOT JU S TIFIED. ' 3 . 2. H OW E VE R THE H O N ' BLE TRIBUNAL IN IT S O RD E R IN ITA NO 2 004 / MDS / 2 01 2 , AT PA G E 9 IN P A R A 6 H AS H E LD- ' WHAT I S TO BE SE EN H E RE I S WHETHER TH E ASSESSE E I S EARNING THIS INCOME AS INCIDENTAL T O TH E A CT IV I T I E S O F THE AS S E SS EE OR WHETHER T HE ASSESSE E I S REALLY ENGAGED IN THE BUSINESS ACTIVITI E S I S TO B E SEE N . N E ITH E R OF TH E LOWER AUTH O R I T IES H A V E E XAMINED THI S A S P E CT O F TH E M.P.NO.93 TO 95 /MDS/2013 3 M A TTER , I. E. , W H E TH E R TH E ASSESSEE I S E ARNING THI S I N CO M E AS IN C ID E NT A L T O IT S O BJ E CT S O R IT I S A LT OGE TH E R A SE P A R ATE BU S IN ESS C A RRI E D ON B Y THE A SSESSEE. IN TH E C IRCUMSTANCE S, W E A R E OF TH E V IEW TH A T THI S MA TT E R S HOULD GO B A CK T O TH E A SS E SS IN G O FFICER T O EX AMIN E A FR ES H ON THE SE LIN ES . 3.3. IT I S S UBMITT E D TH A T AS EX TR A CT E D IN P A R A 3.1 OF THI S A PPLIC A TI O N , TH E L EA RN E D C IT ( APP EA L S) H AS AD DR ESSE D TH E I SS U E A ND H A D HELD TH AT - 'AS N O T E D DO W N IN THE PRECEDING PARA G R A PH TH E A SSESSE E 'S ACTIVIT Y OF L E TTING OUT THE PROPERTIE S AS P E R TH E O BJECT S OF TH E SOCI E T Y AND W ILL N O T CON S TITUTE THE BU S INES S ACTIVITY. THER E FOR E TH E ASSESS IN G OFFIC E R 'S C ONTENTION THAT TH E ASSESSEE I S R E QUIRED TO MAINTAIN SEPARATE BOOKS OF ACCO UNT S U / S 1 1 ( 4A ) OF TH E ACT I S UN FO UN DE D . H E NCE THI S CONTENTI O N O F TH E A SS E SS ING OFFIC E R I S N O T J U S TIFI E D ' 3 . 4. IN V I EW OF TH E A B OVE, I T IS R ES PECT F ULL Y S UBM I TT E D TH A T TH E R E I S A N E RR O R IN TH E O B SE R VA TI O N S OF PA R A 6 A T P AGE 9 OF TH E O RD E R S O F TH E HO N 'B L E T RIBUN A L O N FA CT A ND H E N CE THE O RDER S R E QUIR E REC T IFICAT I O N AS PR OV ID E D U / S 2 54 (2) OF T H E ACT . 4. THE R E I S A N O TH E R I SS U E W HI C H N EEDS REC TI FICA T IO N . IN P A R A 8 A T P AGE 1 3 OF TH E H O N 'BL E TR I B U NA L' S O RD E R I T I S S T A T E D - I N V I EW OF TH E A B OVE DE CI S I O N S OF TH E T R IB UN A L , WE HOLD TH A T TH E M O NI ES A D VA NC E D B Y TH E ASSESSEE T O T H E O TH ER T RU S T S W HICH A R E REG I STE R E D UND E R SE CTI O N 1 2 A A ND H AV IN G S IM I L AR O BJ EC T S CA NN O T B E SA ID T O B E IN V I O L A TI O N OF PR OVIS I O N S O F SE CTI O N 13(L) OF TH E ACT . TH E R EFO R E, W E DIR EC T T H E ASSESS IN G OFF I CER T O EXA MIN E W H E TH ER O TH E R O RG A NI ZA TION S T O WH O M TH E ASSESS E E H AS L E NT MO NI ES A R E R EG I S T E R E D UND E R SEC TION 1 2A A ND IN C A SE, S UCH ORGANI ZA TION S A R E R EG IST E RED UND E R SEC TI O N 1 2 A , TH E E X E MPTION UND E R SECT IO N 1 1 CANN OT B E D E NIED ON THI S GROUND .' 4 . 1 . H OWEVER, T H E C IT ( APP EA L S) IN H IS O RD E R IN ITA N O . 453 / 2011-12 D A T E D 2 3 .07.201 2 , A T PAGE 27 E ND H AS S T A T E D - M.P.NO.93 TO 95 /MDS/2013 4 'A PERUSAL OF THE ASSESSMENT ORDER AND SUBMISSIONS MADE BY THE ASSESSEE REVEALED THAT YMCA TIRUPATTUR IS A PROJECT OF THE NATIONAL COUNCIL OF YMCAS OF INDIA, CALCUTTA WHICH IS ALSO AN ORGANIZATION RECOGNIZED U/S.11 OF THE ACT (VIDE NO.R-C/610/-M/II(2) DATED 26.07.1963) AND HAV ING SIMILAR OBJECTIVES TO THOSE OF THE ASSESSEE. 4 . 2. IN V I EW OF TH E D EF INIT E F INDIN G OF THE C I T(A P PEA L S) TH E O RD E R S OF T H E H O NBL E TRIBUN A L E XTRACTE D IN P A R A 4 ABOVE N EE D M O D IFICATIO N , AS TH E F IND I N G OF TH E C IT (A PP EA L S) I S FO UND T O HA V E B EE N N O T CO N S ID E R E D B Y TH E HON ' BL E T RIB U N A L . 5 . AS SUBMITTED IN PARAGRAPHS 3.5 AND 4.2 ABOVE, IT IS RESPECTFULLY PRAYED THAT AN ORDER U/S.254(2) MAY BE PASSED TO CORRECT THE MISTAKES. 3. WE HAVE GONE THROUGH THE CONTENTS OF THE MISCELLANEOUS PETITION NOS. 93 & 95/MDS/2013 AND IN SO FAR AS THE CONTENTIONS RAISED IN PARAS 3 TO 3.4 OF THE MISCELLANEOUS PETITIONS, THE TRIBUNAL HAVING TAKEN NOTE OF THE DECISIONS RELIED ON BY THE D.R., WHICH ARE REFERRED TO IN PARA 4 OF OUR ORDER, WE ARE OF THE VIEW THAT THE LOWER AUT HORITIES HAVE NOT EXAMINED WHETHER THE ASSESSEE IS EARNING THE IN COME FROM LETTING OUT OF PROPERTIES AS INCIDENTAL TO ITS OBJECTS OR THIS ACTIVITY IS ALTOGETHER A SEPARATE BUSINESS ACTIVITY OF THE ASSESSEE IN THE LIGHT OF THOSE DECISIONS. THEREFORE , THERE IS NO MISTAKE APPARENT FROM RECORD WHICH NEEDS RECTIFICAT ION. THE M.P.NO.93 TO 95 /MDS/2013 5 AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE COULD NO T POINT OUT ANY MISTAKE APPARENT ON RECORD OR ANY ERROR IN OUR OBSERVATIONS. 4. IN RESPECT OF THE CONTENTIONS RAISED IN PARA 4 T O 4.2 OUR CONCLUSIONS DRAWN IN THE ORDER ARE BASED ON THE REC ORDS AVAILABLE WITH US. HENCE, THERE IS NO MISTAKE APPAR ENT ON RECORD OR ANY ERROR IN OUR CONCLUSIONS. MISCELLANEOUS PETITION NO.94/MDS/2013:- 5. IN THE ABOVE MISCELLANEOUS PETITION, THE ASSESSE E STATES THAT THERE IS A MISTAKE IN APPLICATION OF LA W STATING AS UNDER:- 2 . THE A PP EA L H A D BEE N DI S P OSED OF B Y ORDE R DA T ED 29 - 04- 2 01 3 . TH E APP E L LA NT A SSESSEE H AS APPEALE D AGA IN S T TH E E NH A N CE M E N T MADE BY T H E LEAR N E D CIT ( APP EA L S) . T HI S I S D EA LT W ITH I N PARAGRA PH S 11 1 0 16 OF TH E O RD E R S OF T H E TRI BUN A L . 3. IN P A R AG R A PH 1 4 IT I S M E NTIONED - 'T H E CO MMI SS I O N E R O F INCOME TA X (A PP EA L S) A L SO HELD TH A T TH E S AID ` 1 . 00 CRO R E INTRODU CE D B Y TH E AS SES SEE A S C REDI TS ALSO CANN O T BE C O N S IDER E D AS APPLICATION O F INCOME SINCE THI S A M O UNT IS NOT R E C E I VE D BY THE ASSE SSEE BY WA Y O F ANY DONATION . THI S INCOME IS TREATED AS DEE M E D IN CO M E UND E R SE CTION 68 OF T H E ACT . ( EMPHASIS SUPPLIED) M.P.NO.93 TO 95 /MDS/2013 6 1 5 . ON GO IN G THR O U G H TH E ABOVE OBS E R VA T IO N S OF TH E COMMIS SI ON E R OF IN CO M E T AX (APP EA L S), WE FIN D N O GOO D R EASO N TO INTERF ERE WIT H T H E O RD E R O F THE C OMMI SS I O N E R OF INC O M E TAX (APPEA L S) IN S U S T A I NI N G TH E A DDITI ON. IN T H E RES UL T , GRO UND S OF TH E ASSESSEE O N THI S I SS U E A R E REJECTED. 3.1 . IT IS R ES P EC T F ULL Y S UBMITT E D TH AT T H ERE IS A N E RR OR IN TH E A PPLI CA TI O N OF L AW W HIL E D EC I D IN G T HIS ISS U E. TH E REASO N FO R D E CIDING T H E ISS U E H A D B EE N TH A T TH E S UM OF R S 1 . 00 CR O R E I S N O T DO N AT I O N A ND H E N CE I T C A NN O T B E C O N S ID ERED TO BE A PPLICATION OF IN CO M E. 3.2 . T H E AP P E LL A NT R ES P EC T F ULL Y SUBM ITS THAT SECTION 11 D OE S N O T SAY T H A T T H E A M O UNT R ECE I VED AS DONA T IO N A L O N E I S E LI GI BL E FOR C O N S ID ERATIO N AS A PPLIC A TI O N . IT I S O NL Y T H E I N CO M E TH A T HA S TO BE CONS ID E R E D FO R E LIGIBILI TY AS A PPLI CATION . IN TH E A PP E LLANT S C ASE TH E INC O M E IN C LUD ES THI S S UM OF R S. 1.00 CR ORE A ND H E NC E TH E R E I S A M IST AK E I N THE APPL I CATI O N OF L A W WHICH M AY B E CO N S ID E R E D FO R P ASS IN G A N O RDER U / S 2 5 4(2) OF TH E AC T . 6. THE ASSESSING OFFICER WHILE COMPLETING THE ASSES SMENT HELD THAT THE ASSESSEE HAS INTRODUCED ` 1,00,00,000/- AS CREDITS AND SINCE THE ASSESSEE COULD NOT EXPLAIN TH E CREDITS, THEY WERE ADDED AS UNEXPLAINED CREDITS UNDER SECTIO N 68 OF THE ACT. THE COMMISSIONER OF INCOME TAX (APPEALS) FOUND THAT THE ASSESSEE HAS INTRODUCED ` 1,00,00,000/- AS CREDITS AND THIS AMOUNT IS NOT RECEIVED BY THE ASSESSEE AS DONATIONS. THE DECISION OF THE COMMISSIONER OF INCO ME TAX (APPEALS) WAS AFFIRMED BY US. IN THE MISCELLANEOUS PETITION M.P.NO.93 TO 95 /MDS/2013 7 THE ASSESSEE STATES THAT THERE IS AN ERROR IN APPLI CATION OF LAW WHILE DECIDING THIS ISSUE. 7. THE AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE SUBMITS THAT EVEN ANONYMOUS DONATIONS ARE LIABLE FO R TAX UNDER THE PROVISIONS OF SECTION 115BBC, THEREFORE, HE SUBMITS THAT THE TRIBUNAL WENT WRONG IN NOT APPLYIN G THE PROVISIONS OF SECTION 115BBC OF THE ACT FOR THE DEE MED INCOME ASSESSED BY THE ASSESSING OFFICER UNDER SECT ION 68 OF THE ACT. 8. THE ASSESSEE ALL ALONG WAS CONTENDING BEFORE THE ASSESSING OFFICER AND COMMISSIONER OF INCOME TAX (APPEALS) THAT THE SAID AMOUNT OF ` 1,00,00,000/- WAS RECEIVED BY THE ASSESSEE AS LOAN FROM CERTAIN PERSO NS. IT WAS NEVER THE CONTENTION OF THE ASSESSEE THAT THESE AMO UNTS ARE ANONYMOUS DONATIONS. THE ASSESSEE HAS NEITHER RAISE D THIS CONTENTION BEFORE THE ASSESSING OFFICER OR COMMISSI ONER OF INCOME TAX (APPEALS) IN THE PROCEEDINGS BEFORE THEM . THEREFORE, AN ISSUE WHICH WAS NOT RAISED BY THE ASS ESSEE NOR M.P.NO.93 TO 95 /MDS/2013 8 CONSIDERED BY THE ASSESSING OFFICER OR COMMISSIONER OF INCOME TAX (APPEALS) CANNOT BE CONSIDERED NOW THAT TOO IN A MISCELLANEOUS PETITION AND RECALL THE ORDER FOR THA T PURPOSE. THIS IS NOT A MISTAKE APPARENT FROM RECORD, BUT AMO UNTS TO REVIEW AND THIS TRIBUNAL DOES NOT HAVE POWER TO REV IEW ITS OWN ORDER. IN THE CIRCUMSTANCES, WE DO NOT FIND ANY MISTAKE APPARENT FROM RECORD MUCH LESS AN ERROR IN THE ORDE R PASSED BY US WHILE DECIDING THE ABOVE ISSUES IN THE APPEAL S. 9. IN THE RESULT, ALL THE THREE MISCELLANEOUS PETIT IONS OF THE ASSESSEE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON MONDAY , T HE 26 TH DAY OF AUGUST, 2013 AT CHENNAI. SD/- SD/- (ABRAHAM P.GEORGE ) (CHALLA NA GENDRA PRASAD) ACCOUNTANT MEMBER JUDICIAL MEMBER CHENNAI, DATED THE 26 TH AUGUST, 2013. SOMU COPY TO: (1) APPLICANT (4 ) CIT(A) (2) RESPONDENT (5) D.R. (3) CIT (6) G.F.