ROSE BUD MUSLIM EDUCATIONAL SOCIETY,PATNA V. ITO, EXEMPTION, WARD-1, PATNA

ITA 40/PAT/2025

AI Insights

The case involves the Rose Bud Muslim Educational Society, which appealed against the orders of the Commissioner of Income Tax (Appeals) and the Assessing Officer concerning the assessment year 2016-17. The primary contention was the incorrect assessment status and the failure to allow any expenditure against the gross receipts reported by the society. The society argued that the assessments were made ex parte and without adequate opportunity to present its case, citing issues such as the advanced age and ill health of the trustee, and ongoing arbitration proceedings which prevented the production of necessary documents. The Tribunal found merit in the society's arguments and remanded the case for a fresh assessment.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 788802 (ITAT-PATNA)
• Duration Of Justice: 9 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-11-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Assessment Year: misc
• Appeal Filed On: 31-01-2025
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Condonation of delay; Set aside; Opportunity of being heard; Principle of natural justice
• Section: 144; 142(1); 12A; 12

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL, KOLKATA-PATNA ‘e-COURT’, KOLKATA [Hybrid Court Hearing] Before SHRI SONJOY SARMA, JUDICIAL MEMBER & SHRI RAKESH MISHRA, ACCOUNTANT MEMBER ITA No.: 40/PAT/2025 Assessment Year: 2016-17 Rose Bud Muslim Educational Society Vs. Income Tax Officer, Exemption, Ward-1, Patna (Appellant) (Respondent) PAN: AAEFR1318N Appearances: Assessee represented by : Shri D.V. Pathy, Sr. Advocate & Shri Hiresh Karan, Advocate Department represented by : Shri Ashwani Kr. Singal, JCIT Date of concluding the hearing : 16-October-2025 Date of pronouncing the order : 27-November-2025 ORDER PER RAKESH MISHRA, ACCOUNTANT MEMBER: This appeal filed by the assessee is against the order of the ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi [hereinafter referred to as Ld. 'CIT(A)'] passed u/s 250 of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) for AY 2016-17 dated 25.10.2024. 1.1 The Registry has informed that the appeal is delayed by 30 days. However, the assessee has filed a petition seeking condonation of delay stating that the delay in filing the appeal occurred due to her advanced age and ill health of the Trustee looking after the affairs of the assessee- Trust. She has also stated that the delay in filing the appeal was purely Printed from counselvise.com Page | 2 ITA No.: 40/PAT/2025 Assessment Year: 2016-17 Rose Bud Muslim Educational Society unintentional and occurred due to circumstances beyond her control. It is further stated that she was not aware of the order passed by the ld. CIT(Appeals) and when she came to know about the order passed by the ld. CIT(Appeals), she approached the ld. A.R. to prefer an appeal, due to which there was a delay of 30 days in filing the appeal before the Tribunal. Therefore, she has pleaded to condone the delay. On going through the petition, we are satisfied that the assessee had a sufficient cause for the delay; the delay is, therefore, condoned and the appeal is admitted for adjudication. 2. The grounds of appeal raised by the assessee are as under:- 1. For that the grounds of appeal hereto are without prejudice to each other. 2. For that the order of the learned assessing officer and also the Commissioner of Income Tax (Appeal) is bad both in law and on facts. 3. For that the order of the learned assessing officer and also the Commissioner of Income Tax (Appeal) is based on presumption, surmises and conjectures. 4. For that the order of the learned assessing officer and also the Commissioner of Income Tax (Appeal) is further violative of the settled principles of natural justice in as much as no opportunity much less adequate opportunity was ever afforded to the appellant to furnish its defence in course of assessment proceedings. 5. For that the learned assessing officer has erred in assessing the appellant in the status of a firm notwithstanding the fact that the appellant is a society registered under the Societies Act, 1860 and is assessed as such in all proceeding assessment years and has also been granted registration under section 12 AA of the Act by the learned Commissioner of Income Tax, Patna. 6. For that the learned assessing officer has erred in assessing the appellant in the status of the Association of Persons despite grant of registration under section 12A of the Act by the Commissioner of Income Tax. 7. For that the learned Commissioner of Income Tax (Appeal) has erred in confirming the order of assessment subjecting the gross income itself to tax on the solitary ground of non-cooperation in remand proceeding notwithstanding the fact that adequate explanation in relation thereto had furnished in course of such proceeding and further that similar such expenditure was allowed in the preceding assessment years. Printed from counselvise.com Page | 3 ITA No.: 40/PAT/2025 Assessment Year: 2016-17 Rose Bud Muslim Educational Society 8. For that other various reasons that may be urged at the time of hearing. 3. Brief facts of the case are that the assessee-Society is registered under the Societies Act, 1860 and is engaged in the activity of imparting education for the assessment year under consideration. The assessee had filed the return of income showing total income at ₹NIL. The return was selected for complete scrutiny under Computer Assisted Scrutiny Selection (CASS) and statutory notices were issued, which were not complied with nor any document/bill & voucher/paper as requisitioned vide different notices issued under section 142(1) was filed. Therefore, the assessment was made under section 144 of the Act and the excess/deficit of income/expenditure was considered to the extent of Rs.90,47,790/- and the gross receipt of Rs.60,54,326/- was not allowed and the income of the assessee-Trust was assessed at Rs.60,54,326/- under section 144 of the Income Tax Act. 4. Aggrieved with the assessment order of ld. Assessing Officer, the assessee filed an appeal before the ld. CIT(Appeals), who has discussed the facts of the case and the assessment order. The Ld. CIT(A) issued several notices for hearing. Out of three notices, two remained uncompiled and reply was filed on 24.03.2021 in response to notice issued on 15.02.2021. The assessee filed additional ground/evidence in support of the appeal and a remand report was called for from the Ld. AO. The remand report submitted by the Ld. AO on 14/02/2024 was confronted to the assessee on 21/03/2024, but the assessee sought an adjournment on 12/04/2024, and the show cause issued on 18/10/2024 was not complied. Therefore, the claim could not be substantiated by the assessee and it was inferred by the Ld. CIT(Appeals) that the assessee was not pursuing the case of merits as Printed from counselvise.com Page | 4 ITA No.: 40/PAT/2025 Assessment Year: 2016-17 Rose Bud Muslim Educational Society no documents to Contribute the finding of the AO were filed. He held that the appeal could not be decided merely on the basis of grounds of appeal and the statement of facts as no corroborative evidence of any kind had been submitted by the assessee. Therefore, the addition made by the AO was upheld and the appeal was dismissed. Aggrieved with the order of the Ld. CIT(A), the assessee has filed the appeal before the Tribunal. 5. We have considered the rival submissions and the details available on record have been examined. It was submitted by the ld. A.R. that the assessee maintains the books of account but before the ld. Assessing Officer, no books of account could be produced. During the remand proceeding, the assessee could not produce the books of account as it was engaged in an arbitration proceeding and the books of account were required to be produced on 04.07.2023 before the ld. Assessing Officer. A local criminal had taken over the property of the assessee. The ld. CIT(A) has relied upon the assessment order and as during the remand proceeding the assessee failed to make any compliance and as it did not file any reply, the addition made by the ld. Assessing Officer was upheld and the appeal was dismissed. The Ld. AR submitted before the Tribunal that the assessment was made ex parte as no books of accounts were produced before the AO. The assessee had shown gross receipts of ₹ 60,54,330/- and the application of the gross income had been claimed at ₹ 90,47,790/- but the entire gross receipts have been added and no expenditure whatsoever has been allowed. It was requested that another opportunity may be provided as the society has sufficient documents in support of the application of income and the AO has not allowed any expenditure or even computed the income Printed from counselvise.com Page | 5 ITA No.: 40/PAT/2025 Assessment Year: 2016-17 Rose Bud Muslim Educational Society in the commercial sense. It was requested that the matter may be remanded to the Ld. AO so that the assessee could produce the required evidence in support of the application of income. The Ld. DR relied upon the order of the appellate authority and requested that the same may be confirmed. 6. We have considered the facts of the case, the submissions made and the documents filed. Since there was no proper compliance before both the Ld. AO as well as the Ld. CIT(A), in the interest of justice and fair play it was considered that the request of the assessee to set aside the case before the Ld. AO may be allowed so that a proper opportunity of being heard may be provided. Hence, after examining the facts of the case, we deem it appropriate to set aside the order of the Ld. CIT(A) as well as the order of the Ld. AO and remit the matter back to the Ld. AO for making the reassessment de novo. Needless to say, the assessee shall be given a reasonable opportunity of being heard to make any further submission it wants to make in support of the relief claimed and shall not seek unnecessary adjournments. Accordingly, the grounds taken by the assessee in his appeal are partly allowed for statistical purposes. 7. In the result, the appeal filed by the assessee is partly allowed for statistical purposes. Order pronounced in the open Court on 27th November, 2025. Sd/- Sd/- Sd/- Sd/- [Sonjoy Sarma] [Rakesh Mishra] Judicial Member Accountant Member Dated: 27.11.2025 Printed from counselvise.com Page | 6 ITA No.: 40/PAT/2025 Assessment Year: 2016-17 Rose Bud Muslim Educational Society Copy of the order forwarded to: 1. Rose Bud Muslim Educational Society, Shri Krishna Puri West, Patna-800013, Bihar 2. Income Tax Officer, Exemption, Ward-1, Patna, Bihar 3. CIT(A), NFAC, Delhi; 4. CIT- 5. CIT(DR), Kolkata Benches, Kolkata. 6. Guard File. //True copy // By order Assistant Registrar ITAT, Kolkata Benches Kolkata Laha Printed from counselvise.com "