SANT SHREE ASHARAMJI MAHILA UTTHAN ASHRAM,AHMEDABAD V. THE DY.DIT- (EXEMPTION), AHMEDABAD

ITA 1154/AHD/2015

AI Insights

The case involves two appeals by Sant Shree Asharamji Mahila Utthan Ashram against the orders of the Commissioner of Income Tax (Appeals), Ahmedabad, concerning the Assessment Year 2011-12. The appeals challenged the ex-parte assessment order under section 144 and the penalty order under section 271(1)(c) of the Income Tax Act. The primary contention was the denial of exemption under sections 11 and 12, which the assessee argued was unjustified as they had complied with the necessary documentation and had applied a significant portion of their income towards the trust's objectives. The Tribunal found that the lower authorities had not adequately considered the additional evidences provided and thus remanded the matter back to the AO for a detailed examination.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 835185 (ITAT-AHMEDABAD)
• Duration Of Justice: 10 year(s) 9 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-02-2026
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2011-2012
• Appeal Filed On: 05-05-2015
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MAITHILI MEHTA; SENIOR STANDING COUNSEL
• Assessee Lawyers: S.N. SOPARKAR; URVASHI SHODHAN
• Keywords: Set aside; Additional evidence; Corroborative evidences; Charitable institution
• Section: 144; 271(1)(c); 11; 12AA; 12A; 12; 80G

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL “B” BENCH, AHMEDABAD BEFORE SHRI TR SENTHIL KUMAR, JUDICIAL MEMBER AND SHRI NARENDRA PRASAD SINHA, ACCOUNTANT MEMBER ITA No. 1154/AHD/2015 & ITA No. 1239/AHD/2018 Assessment Years: 2011-12 Sant Shree Asharamji Mahila Utthan Ashram, Sant Asharmji Ashram, Motera Road, Sabarmati, Ahmedabad - 380006 [PAN – AABTS0869A] Vs. Deputy Director of Income Tax – (Exemption), Ahmedabad-380006 (Appellant) (Respondent) Assessee by Shri S.N. Soparkar, Sr. Advocate & Ms. Urvashi Shodhan, AR Revenue by Ms. Maithili Mehta, Senior Standing Counsel Date of Hearing 21.01.2026 Date of Pronouncement 09.02.2026 O R D E R PER NARENDRA PRASAD SINHA, ACCOUNTANT MEMBER: These two appeals are filed by the assessee against the separate orders of Commissioner of Income Tax (Appeal), Ahmedabad – 9, [in short ‘CIT(A)’] dated 03.02.2015 and 04.01.2018, both for the Assessment Year (A.Y.) 2011-12, in the proceedings u/s 144 and u/s 271(1)(c) of the Income Tax Act [hereinafter referred as “the Act”], respectively. 2. There was a delay of 47 days in filing appeal in ITA No. 1239/Ahd/2018. An affidavit has been filed by Ms. Vandana K Sahoo, the Trustee of the assessee explaining the reason for the delay. It has been Printed from counselvise.com ITA No. 1154/Ahd/2015 & ITA No. 1239/Ahd/2018 Sant Shree Asharamji Mahila Utthan Ashram Vs. DDIT, AY-2011-12 2 stated that the authorised representative and other trustees were engaged in legal work at Jodhpur case with reference to one of the trustees and the concerned authorised person could not be contacted in time for filing the present appeal. As a result, there was a delay of 47 days in filing of this appeal. Considering the explanation of the assessee and also the merit of the case, the delay in filing of this appeal is condoned. 3. The brief facts of the case are that the assessee Trust had filed its return of income for A.Y. 2011-12 on 13.09.2011 declaring income of Rs. 39,729/- after claiming exemption to the extent of Rs. 41,91,970/-. The case was selected for scrutiny. In the course of assessment, the AO noticed that the assessee did not furnish exemption certificate u/s 35(1)(i)/35(1)(ii)/10(23C) of the Act in order to prove the genuineness of the trust and that it was established wholly for charitable purpose. The AO had also called for proof of registration u/s 12AA of the Act, copy of trust deed, copy of certificate u/s 80G and copy of registration with Charity Commissioner in order to examine the exemption claimed u/s 11 and 12 of the Act. No compliance was made before the AO and the documents as required were not furnished. Therefore, the AO had disallowed the expenses as claimed by the trust. The assessment was completed ex- parte u/s 144 of the Act on 04.03.2014 at total income of Rs.49,87,952/-. The AO had initiated penalty proceeding u/s 271(1)(c) of the Act while completing the assessment. Thereafter, a separate penalty order was passed on 03.02.2016 imposing penalty of Rs. 14,96,386/-. 4. Aggrieved with the orders of the AO, the assessee had filed appeals before the First Appellate Authority which were decided by the Ld. CIT(A) Printed from counselvise.com ITA No. 1154/Ahd/2015 & ITA No. 1239/Ahd/2018 Sant Shree Asharamji Mahila Utthan Ashram Vs. DDIT, AY-2011-12 3 vide the impugned orders and the appeals of the assessee were dismissed. 5. Now, the assessee is in second appeal before us. The followings grounds have been taken in these appeals: ITA No. 1154/AHD/2015 1. On the facts and in the circumstances of the case, the learned CIT (Appeals) erred in rejecting Ground No. 1 raised by the appellant before him to the effect that the assessment order passed by the Assessing Officer u/s. 144 of the I.T. Act, is bad in law. 2. On the facts and in the circumstances of the case, the learned CIT (Appeals) erred in upholding the Assessing Officer’s finding that the appellant-trust is not entitled to exemption u/s. 11 of the I.T. Act. 3. On the facts and in the circumstances of the case, the learned CIT (Appeals) erred in rejecting the contention raised by the appellant-trust before him that during the course of the assessment proceedings the appellant-trust was prevented by sufficient cause from furnishing some information/documents to the Assessing Officer. 4. The appellant craves leave to add, alter, amend and/or withdraw any ground or grounds of appeal either before or during the course of hearing of the appeal. ITA No. 1239/AHD/2018 1. In law and facts in the facts and the facts and the circumstance of the case, the Learned CIT(A)-9 has erred in not entertaining the grounds of appeal that the order passed by the AO u/s 271(1)(c) of the I.T. Act, 1961 was bad in law. 2. In Law and in the facts and the circumstances of the case, the Learned CIT(A)-9 has erred in confirming the penalty levied u/s 271(1)(c) of the I.T. Act, 1961. He ought to have deleted the penalty so levied. Printed from counselvise.com ITA No. 1154/Ahd/2015 & ITA No. 1239/Ahd/2018 Sant Shree Asharamji Mahila Utthan Ashram Vs. DDIT, AY-2011-12 4 2.1 The appellant prays that Hon’ble ITAT may delete the penalty so levied. 3. The appellant craves leave to add, alter, amend and/or withdraw any ground or grounds of appeal either before or during the course of hearing of the appeal. 6. Shri S. N. Soparkar, the Ld. Sr. Advocate appearing for the assessee fairly conceded that no compliance was made by the assessee before the Assessing Officer. He, however, submitted that all the documents as required were duly produced before the Ld. CIT(A) which was not considered in right perspective and the appeal of the assessee was dismissed without calling for any remand report from the AO in respect of additional evidences filed by the assessee. The Ld. Sr. advocate explained that the assessee was registered u/s 12A of the Act, vide order dated 21.09.1995 and the number and date of registration u/s 12A/12AA being S-7/95-96 dated 21.09.1995 was duly mentioned at serial no. 8 of the Income-tax return (ITR-7) for the A.Y. 2011-12. On the finding of the Ld. CIT(A) that due to non-compliance of the assessee, the AO couldn’t verify whether the application of income was as per the objects of the trust or not, the Ld. Sr. Counsel submitted that the matter may be set aside to the file of AO to carry out this verification. 7. Per Contra, Ms. Maithili Mehta, Ld. Sr. Standing Counsel appearing for the Department submitted that the assessee did not make any compliance before the Assessing Officer and the documents and evidences as required by the AO were not produced. She submitted that the observation of the Ld. CIT(A) were relevant factors which was required to be examined by the AO. She had no objection if the matter was set Printed from counselvise.com ITA No. 1154/Ahd/2015 & ITA No. 1239/Ahd/2018 Sant Shree Asharamji Mahila Utthan Ashram Vs. DDIT, AY-2011-12 5 aside to the file of AO with a specific direction to examine the issues as flagged by the Ld. CIT(A). 8. We have considered the rival submissions. The assessee did not make any compliance in the course of assessment proceeding and the documents and details as required by the AO were not furnished. Therefore, the AO had disallowed the claim for deduction made u/s. 11/12 of the Act. The fact that the assessee was registered under 12A/12AA of the Act was evident from the return of income filed by the assessee. Before the Ld. CIT(A), the assessee had furnished all the required documents. It was explained that trust was registered with Charity Commissioner of Gujarat vide registration No. E-10215 on 29.01.1994 and a copy of the registration certificate granted by the Commissioner of Income Tax on 21.09.1995 was also furnished. Similarly, a copy of certificate u/s. 80G of the Act dated 20.11.1996 was also brought on record. The contention of the assessee was that against total income of Rs.49,31,729/- a sum of Rs.42,31,699/- was applied towards administrative expense for the purpose of objects of the trust, which was more than 85% of total gross income. Therefore, it was entitled to claim of exemption u/s. 11 of the Act. The Ld. CIT(A) had, however, given a finding that whether the application of income as claimed by the assessee was as per the objects of the trust or not, was not examined by the AO in the absence of any compliance on the part of the assessee. She had, therefore, dismissed the appeal of the assessee. 9. The aspect as to whether the expenses incurred by the assessee were towards the objects of the trust, was not examined by the AO in the course of assessment proceeding. Neither the details of the expenses Printed from counselvise.com ITA No. 1154/Ahd/2015 & ITA No. 1239/Ahd/2018 Sant Shree Asharamji Mahila Utthan Ashram Vs. DDIT, AY-2011-12 6 were furnished nor any supporting evidence in that respect was brought on record by the assessee. The AO had disallowed the claim for deduction u/s. 11/12 of the Act for the reason that the relevant certificates were not furnished. When the details and documents as required by the AO were brought on record before the Ld. CIT(A) as additional evidence, the Ld. CIT(A) should have called for a remand report of the AO on those evidences, before coming to any conclusion on the merits of the claim. Neither the ld. CIT(A) had obtained the details of expenses incurred by the assessee and examined them, before coming to the conclusion that the application of income by the assessee was not as per the objects of the trust. The conclusion of the Ld. CIT(A) was based on presumption and not on any concrete finding after examining the claim on merits. Therefore, the order of the Ld. CIT(A) cannot be upheld. 10. Considering the fact that the assessee had brought on record the documents and details as required by the AO before the Ld. CIT(A) in the form of additional evidences, we deem it proper to set aside the matter to the file of the Jurisdictional AO with a direction to examine those additional evidences filed by the AO and thereafter re-adjudicate the issue. The AO will be free to examine whether the expenses incurred by the assessee and the application of income as made, was as per the objects of the appellate trust and thereafter decide the claim for deduction u/s. 11/12 of the Act. The assessee is also directed to make compliance before the AO in the course of set aside proceeding and produce the details, documents and clarifications as required by the AO. In case the assessee does not make compliance and doesn’t produce the required details/documents, the AO will have liberty to pass the order on merits on the basis of materials available on record. Printed from counselvise.com ITA No. 1154/Ahd/2015 & ITA No. 1239/Ahd/2018 Sant Shree Asharamji Mahila Utthan Ashram Vs. DDIT, AY-2011-12 7 11. In the result, the appeal of the assessee is allowed for statistical purpose. ITA No. 1239/AHD/2018 12. Since the assessment order passed by the AO has been set aside for making a fresh assessment, the penalty imposed in pursuance to the original order does not survive. Accordingly, the penalty imposed u/s 271(1)(c) of the act is cancelled. The AO will be free to initiate penalty as per the provisions of the Act, while completing the de-novo assessment. 13. The appeal of the assessee is allowed. 14. In the final result, the appeal in ITA No. 1154/AHD/2015 is allowed for statistical purpose while the appeal in ITA No. 1239/AHD/2018 is allowed. Order pronounced in the Court on 09/02/2026 at Ahmedabad. Sd/- Sd/- (TR SENTHIL KUMAR) (NARENDRA PRASAD SINHA) Judicial Member Accountant Member Dated - 09th February, 2026 Nk True Copy आदेश आदेश आदेश आदेश क\u0002 क\u0002 क\u0002 क\u0002 \u0003ितिलिप \u0003ितिलिप \u0003ितिलिप \u0003ितिलिप अ ेिषत अ ेिषत अ ेिषत अ ेिषत/Copy of the Order forwarded to : 1. अपीलाथ\u0007 / The Appellant 2. \b यथ\u0007 / The Respondent. 3. संबंिधत आयकर आयु / Concerned CIT 4. आयकर आयु (अपील) / The CIT(A) 5. िवभागीय \bितिनिध, आयकर अपीलीय अिधकरण / DR, ITAT, 6. गाड\u0014 फाईल /Guard file. Printed from counselvise.com ITA No. 1154/Ahd/2015 & ITA No. 1239/Ahd/2018 Sant Shree Asharamji Mahila Utthan Ashram Vs. DDIT, AY-2011-12 8 आदेशानुसार आदेशानुसार आदेशानुसार आदेशानुसार/BY ORDER, उप उप उप उप/सहायक सहायक सहायक सहायक पंजीकार पंजीकार पंजीकार पंजीकार (Dy./Asstt.Registrar) आयकर आयकर आयकर आयकर अपीलीय अपीलीय अपीलीय अपीलीय अिधकरण अिधकरण अिधकरण अिधकरण, अहमदाबाद अहमदाबाद अहमदाबाद अहमदाबाद / ITAT, Ahmedabad Printed from counselvise.com "