PARIVAAR EDUCATION SOCIETY,KOLKATA V. D.C.I.T., CIRCLE - 1(1), EXEMPTION, KOLKATA

ITA 1938/KOL/2024

AI Insights

The case involves Parivaar Education Society appealing against the order of the National Faceless Appeal Centre, Delhi, which upheld the AO's decision denying the benefit of exemption under section 11 of the Income Tax Act for the Assessment Year 2018-19. The assessee challenged the CIT(A)'s decision on several grounds, including the denial of statutory accumulation and the treatment of capital expenditure as an application of income. The Tribunal found that the AO had not provided a fair opportunity of hearing before submitting a remand report, which led to the decision to remand the case back to the AO for a fresh examination with the new evidences.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 25062 (ITAT-KOLKATA)
• Duration Of Justice: 2 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-12-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2018-2019
• Appeal Filed On: 17-09-2024
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SUBHENDU DATTA
• Assessee Lawyers: SIDDARTH AGARWAL
• Keywords: Additional evidence; Capital expenditure; Benefit of exemption
• Section: 11

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, KOLKATA BEFORE SHRI RAJESH KUMAR, AM AND SHRI SONJOY SARMA, JM ITA No.1938/KOL/2024 (Assessment Year: 2018-19) Parivaar Education Society C/o Subash Agarwal & Associates, Advocates, Siddha Gibson, 1, Gibson Lane, Suite 213, 2nd Floor, Kolkata-700069, West Bengal Vs. DCIT, Circle 1(1), Exemption 10, Sir Willam Jones Sarani, Middleton Row, park Street Area, Kolkata-700071, West Bengal (Appellant) (Respondent) PAN No. AAATP8497J Assessee by : Shri Siddarth Agarwal, AR Revenue by : Shri Subhendu Datta, DR Date of hearing: 20.11.2024 Date of pronouncement : 05.12.2024 O R D E R Per Rajesh Kumar, AM: This is an appeal preferred by the assessee against the order of the National Faceless Appeal Centre, Delhi (hereinafter referred to as the “Ld. CIT(A)”] dated 29.07.2024 for the AY 2018-19. 02. The assessee has challenged the order of ld. CIT (A) on various grounds raised in the following memorandum of appeal which are extracted below for the sake convenience:- “1. (a) For that on the facts and in the circumstances of the case, the Ld. CIT(A) was not justified in upholding the action of the A.O. in denying the benefit of exemption claimed u/s 11 of the Act. Page | 2 ITA No.1938/KOL/2024 Parivaar Education Society; A.Y. 2018-19 (b) For that the Ld. CIT(A) ought to have directed the A.O. to allow benefit of statutory accumulation of 15% amounting to Rs. 1,84,99,307/- as per the provision of section 11(1)(a). 2. For that on the facts and circumstances of the case, the Ld. CIT(A) ought to have directed the A.O. to treat capital expenditure of Rs. 12,04,12,460/- incurred by the assessee as an application of income. 3. For that the Ld. CIT(A) failed to appreciate that the A.O.did not provide any opportunity of hearing to the assessee before furnishing Remand Report to him.” 03. At the time of hearing, the ld. Counsel for the assessee filed an application before the Bench dated 17.10.2024 under rule 46A for admission of additional evidences from page no. 3 to 147, which have also been submitted before the ld CIT(A). The ld. AR vehemently submitted before us that the examination of these evidences is of paramount of importance and goes to the root of the matter for correct adjudication of the issue involved in the present appeal. These evidences comprises of affidavit sworn by the President of assessee society, land deeds, valuation report-cum project status of construction work, copies of ledger of movable assets addition with sample bills. The contention of the counsel of the assessee was that these evidences were filed before the ld. CIT (A) and ld. CIT (A) called for the remand report on these evidences however, the ld. AO prepared an adverse remand report without providing any opportunity of hearing. The ld. AR therefore argued that the present evidences may kindly admitted and the appeal of the assessee may be restored to the file of the ld. AO for correct appreciation of these evidences and adjudicate the matter after taking into account the same . 04. The ld. DR on the other hand strongly opposed the admission of these evidences at this stage and also opposed the restoration of the issue again to the file of the ld. CIT (A) as this would involve wastage of time and manpower of the department. Page | 3 ITA No.1938/KOL/2024 Parivaar Education Society; A.Y. 2018-19 05. After haring the rival contentions and perusing the materials available on record, we find that the evidences filed by the assessee in the form of additional evidences under Rule 46A of the Act are quite vital for adjudication of the issue involved in the present appeal. We note that the ld. AO has furnished the remand report without any opportunity given to the assessee which was considered by ld. CIT (A) without appreciating the fact that the remand report was prepared by the AO without allowing reasonable opportunity of hearing to the assessee. Under these circumstances, we are of the view that in the interest of justice , one more opportunity may be given to the assessee to present its case before the ld. AO after admitting these evidences. Accordingly, we admit these evidences and remand the appeal before the ld. AO for fresh adjudication for giving reasonable opportunity to the assessee to explain these documents. The appeal of the assessee is allowed for statistical purposes. 06. In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open court on 05.12.2024. Sd/- Sd/- (SONJOY SARMA) (RAJESH KUMAR) (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) Kolkata, Dated: 05.12.2024 Sudip Sarkar, Sr.PS Page | 4 ITA No.1938/KOL/2024 Parivaar Education Society; A.Y. 2018-19 Copy of the Order forwarded to : 1. The Appellant 2. The Respondent 3. CIT 4. DR, ITAT, 5. Guard file. BY ORDER, True Copy// Sr. Private Secretary/ Asst. Registrar Income Tax Appellate Tribunal, Kolkata "