NATIONAL CULTURE FUND,NEW DELHI V. NATIONAL -E ASSESSMENT CENTRE, NEW DELHI

ITA 5179/DEL/2024

AI Insights

The case involves the National Culture Fund, a trust registered under Section 12A of the Income Tax Act, which appealed against the order of the CIT(A)/NFAC, Delhi. The appeal was directed against the assessment order passed by the National e-Assessment Centre, which deemed an unutilized amount of Rs. 2,26,00,172 as income for the assessment year 2018-19. This amount was part of a larger sum accumulated in the assessment year 2012-13 for a specified purpose but remained unutilized. The ITAT decided to remit the case back to the AO for a fresh assessment, referencing similar previous cases and the need for a detailed examination of the taxability of the interest income and the unutilized amount.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 312959 (ITAT-DELHI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-04-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Assessment Year: 2018-2019
• Other Referred Cases: ITA Nos. 2721/Del/2024 for A.Y. 2016-17, ITA No. 2722/Del/2024 for A.Y. 2017-18
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Opportunity of being heard; Deemed to accrue or arise in india
• Section: 143(3); 12A; 10B

Judgement Text

"1 ITA No. 5179/Del/2024 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “E”: NEW DELHI Ms. MADHUMITA ROY, JUDICIAL MEMBER AND SHRI NAVEEN CHANDRA, ACCOUNTANT MEMBER ITA No. 5179/DEL/2024 Assessment Year: 2018-19 National Culture Fund, 5th Floor, D-Block, Puratatva Bhawan, East Kidwai Nagar, Delhi-110023. PAN- AAATN 4595 M Vs Income-tax Officer, Exemption, Ward-2(4), New Delhi. APPELLANT RESPONDENT Assessee represented by Shri Gurjeet Singh Adv. Department represented by Sh. Amit Katoch, Sr. DR Date of hearing 03.03.2025 Date of pronouncement 30.04.2025 O R D E R PER Ms. MADHUMITA ROY, JM: The instant appeal filed by the assessee is directed against the order dated 30.09.2024 passed by the Ld. CIT(A)/NFAC, Delhi [DIN & Order No. ITBA/NAC/S/250/2024-25/1069269630(1)], arising out of the order dated 23.04.2021 passed by the National e-Assessment Centre, Delhi, under Section 143(3) of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) for Assessment Year 2018-19, whereby and where under the assessment finalized by the Ld. AO upon making the addition to the tune of Rs. 2,26,00,172/- has been 2 ITA No. 5179/Del/2024 confirmed by the Ld. First Appellate Authority for non-compliance of the assessee. In fact the assessee, a trust registered under Section 12A of the Act vide order dated 06.01.1997, filed its return and Form 10B for the year under consideration. The total amount of Rs. 2,62,06,394/- was accumulated in the A.Y. 2012-13 under Section 11(2) of the Act out of which Rs. 2,26,00,172/- remained unutilized in the year under consideration. The nature of income as earned during A.Y. 2012- 13consisted of fixed deposit interest and saving bank interest income of Rs. 3,08,21,052/-. According to the Ld. AO the amount accumulated in A.Y. 2012- 13for specified purpose if utilized in the year immediately following the expiry thereof shall be deemed to be the income of such person of the previous immediately following the expiry of the period aforesaid. This amount of Rs. 2,26,00,172/- is reported as deemed income in Form 10B and there is no scope for alternative view on the taxability of unutilized amount during the year under consideration. Under this premise the impugned amount is deemed to be income of the assessee under Section 11(3) of the Act and accordingly taxed which was further confirmed by the Ld. First Appellate Authority in the absence of compliance made by the assessee inspite of several notices having been served. Hence the instant appeal before us. 2. Under these facts and circumstances of the matter the Ld. Counsel for the assessee relied upon the order of the coordinate Bench of the ITAT passed in 3 ITA No. 5179/Del/2024 assessee’s own case for A.Yrs. 2016-17 & 2017-18 wherein following facts were considered and passed order directing to remit the issue to the file of the Ld. AO for fresh adjudication of the same: “8. We have heard both the parties and perused the material available on record. There are two issues in this appeal i.e. the taxability of Rs.84,24,460/- and the non-allowance of accumulation u/s 11(2) of the Act amounting to Rs.2,85,12,371/-. For this, it has to be decided as to whether ‘interest from deposits as specified u/s 11(5) of the Act’ amounting to Rs.3,35,31,966/- was part of the Corpus Fund and therefore non-taxable u/s 11(i)(d) of the Act. It appears that the said plea was not taken by the assessee either before the AO or before the Ld. CIT(A). Further, no finding has been given by the ld. CIT(A) with respect to the condonation application filed by the assessee before the CIT(E) vide letter dated 03.01.2019. Therefore, considering the facts in totality, the order of the Ld. CIT(A) is set- aside and the matter is restored back to the file of the AO for considering the above legal submission of the assessee regarding the non-taxability of interest amounting to Rs.3,35,31,966/- u/s 11(5) of the Act and the decision of the Ld. CIT(E) in respect of the condonation application in filing Form 10B belatedly i.e. on 28.03.2018. After considering these aspects, the AO will frame the assessment de-novo as per law after giving due opportunity of being heard to the assessee.” 3. Thus, having regard to this particular aspect of the matter it is found fit and proper to grant further opportunity to the assessee to represent its case as has already been done by the assessee for A.Yrs. 2016-17 & 2017-18. We thus allow this appeal by remitting the same to the file of Ld. AO to readdress the grievance of the assessee keeping in view observation made by the coordinate Bench in ITA Nos. 2721/Del/2024 for A.Y. 2016-17 & ITA No. 2722/Del/2024 for A.Y. 2017- 18 and to pass orders accordingly. 4 ITA No. 5179/Del/2024 4. In the result, assessee’s appeal in ITA No. 5179/Del/2024 is allowed for statistical purposes. Order pronounced in open court on 30.04.2025. Sd/- Sd/- (NAVEEN CHANDRA) (MS. MADHUMITA ROY) ACCOUNTANT MEMBER JUDICIAL MEMBER *MP* Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI "