R K SIPANI FOUNDATION,BANGALORE V. INCOME TAX OFFICER (E), WARD-2, BANGALORE, BANGALORE

ITA 1910/BANG/2024

AI Insights

The case involves M/s. R K Sipani Foundation, a charitable trust, which appealed against the order of the National Faceless Appeal Centre (NFAC), Delhi, concerning the assessment year 2013-14. The primary issues in the appeal included the addition of corpus donations as income, disallowance of claimed depreciation, and denial of exemption under section 11 of the Income Tax Act regarding investments in immovable property. The CIT(A) had dismissed the initial appeal ex-parte, erroneously referring to documents of a different assessee. The Tribunal found this procedural error significant and remanded the case back to the CIT(A) for a fresh decision.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 32815 (ITAT-BANGALORE)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-01-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2013-2014
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AMITH DORERAJU M
• Assessee Lawyers: SURESH MUTHUKRISHNAN
• Keywords: Set aside; Depreciation; Capital expenditure; Charitable institution
• Section: 142(1); 143(2); 11; 12A

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL ‘B’ BENCH : BANGALORE BEFORE SHRI WASEEM AHMED, ACCOUNTANT MEMBER AND SHRI SOUNDARARAJAN K., JUDICIAL MEMBER ITA No. 1910/Bang/2024 Assessment Year : 2013-14 M/s. R K Sipani Foundation, 868, 5th A Cross, 17th E Main, 6th Block, Koramangala, Koramangala S.O., Bangalore – 560 034. PAN: AABTR2113E Vs. The Income Tax Officer (E), Ward – 2, Bangalore. APPELLANT RESPONDENT Assessee by : Shri Suresh Muthukrishnan, CA Revenue by : Shri Amith Doreraju M, Addl. CIT (DR) Date of Hearing : 11-11-2024 Date of Pronouncement : 06-01-2025 ORDER PER SOUNDARARAJAN K., JUDICIAL MEMBER This is an appeal filed by the assessee challenging the order of the NFAC, Delhi dated 29/07/2024 in respect of the A.Y. 2013-14 with the following grounds of appeal: “1. The order of the learned Assessing Officer in so far as it is against the Appellant is opposed to law, equity, weight of evidence, probabilities, facts and circumstances of the case. 2. The learned CIT(A) has erred in dismissing the appeal by holding that the Appellant had not substantiated its claims vide documentary and other evidence before the authorities below under the facts and circumstances of the Appellant's case. Page 2 of 4 ITA No. 1910/Bang/2024 3. The learned CIT(A) has erred in dismissing the appeal by wrongly referring to Form 35 and Grounds of appeal of a different assessee altogether. 4. The authorities below are not justified in adding a sum of INR. 3,88,87,980/- being the Corpus Donations received by the Appellant trust under the facts and in the circumstances of the Appellant's case. 5. The authorities below are not justified in disallowing the depreciation claimed of INR. 1,96,880/- under the facts and in the circumstances of the Appellant's case. 6.The authorities below are not justified in denying the benefit: of exemption u/s. 11 of the Act in respect of the investment made in Immovable property amounting to INR. 3,41,72,000/- under the facts and in the circumstances of the Appellant's case. 7. Without prejudice to the above, the Appellant denies itself liable to be charged to interest u/s. 234-A and 234-B of the Act, which under the facts and in the circumstances of the Appellant's case deserves to be cancelled. 8. For the above and other grounds that may be urged at the time of hearing of the appeal, your Appellant humbly prays that the appeal may be allowed and Justice rendered.” 2. The assessee is a charitable trust and filed their return of income on 23/12/2013. The assessee has also got registered u/s. 12A of the Act. The assessee’s case was selected for scrutiny under CASS and notices u/s. 143(2) and 142(1) were issued. The assessee also filed their reply with particulars and thereafter the AO not accepted the claim of application of the income towards the object of the trust for the reason that the assessee had produced only the agreement to sale and not any sale deed. The AO further on the reason that there is no registered deed for effecting the transfer of the immovable property and therefore come to the conclusion that the claim of the assessee that the income has been applied towards the capital expenditure was not proved. The AO also disallowed the depreciation of Rs. 1,96,880/-. As against the said order, the assessee filed appeal before the Ld.CIT(A). Page 3 of 4 ITA No. 1910/Bang/2024 3. Before the Ld.CIT(A), the assessee had not appeared and therefore the Ld.CIT(A) had decided the appeal ex-parte. As against the said order of the Ld.CIT(A), the assessee has preferred this appeal before this Tribunal. 4. At the time of hearing, the Ld.AR submitted that the Ld.CIT(A) had wrongly referred the form 35 filed by some other assessee while deciding the appeal ex-parte. We have considered the submission alongwith the records and found that the ld CIT(A) had considered the Form 35 of some other assessee and passed an exparty order after observing that the case of the appellant was examined on merits in the light of grounds of appeal and statement of facts filed. Considering the said peculiar facts and circumstances, we are inclined to set aside the order of the Ld.CIT(A) and direct the Ld.CIT(A) to consider the appeal afresh by taking into the correct form 35 filed by the assessee and thereafter decide the appeal on merits in accordance with law after hearing the assessee. 5. In the result, the appeal filed by the assessee is allowed for statistical purposes. Order pronounced in the open court on 06th January, 2025. Sd/- Sd/- (WASEEM AHMED) (SOUNDARARAJAN K.) Accountant Member Judicial Member Bangalore, Dated, the 06th January, 2025. /MS / Page 4 of 4 ITA No. 1910/Bang/2024 Copy to: 1. Appellant 2. Respondent 3. CIT 4. DR, ITAT, Bangalore 5. Guard file 6. CIT(A) By order Assistant Registrar, ITAT, Bangalore "