SCIENCE FORUM FOR RURAL DEVELOPMENT AND RESEARCH TAKSHSHILA JUNIOR COLLEGE,UJJAIN V. CIT(A), UJJAIN

ITA 338/IND/2024

AI Insights

The case involves Science Forum for Rural Development & Research Takshashila Junior College, which appealed against the penalty imposed under Section 271D of the Income Tax Act for receiving loans in cash, violating Section 269SS. The initial assessment for AY 2014-15 declared a nil income, but upon scrutiny, an income of Rs. 1,17,65,000 was assessed, and penalties were imposed for cash loans received. The CIT(A) upheld the penalty, leading to this second appeal. The Tribunal found procedural lapses in the handling of the assessee's case and remanded it back to the CIT(A) for a thorough re-examination.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 34669 (ITAT-INDORE)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-03-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Assessment Year: 2014-2015
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: ASHISH PORWAL
• Assessee Lawyers: RUCHIRANERKAR
• Keywords: Condonation of delay; Set aside; Reasonable cause
• Section: 143(3); 250; 271D; 246A; 271E

Judgement Text

"Page 1 of 9 आयकर अपीलीय अिधकरण, इंदौर Ɋायपीठ, इंदौर IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI BHAGIRATH MAL BIYANI, ACCOUNTANT MEMBER AND SHRI PARESH M JOSHI, JUDICIAL MEMBER ITA No. 338/Ind/2024 Assessment Year: 2014-15 Science Forum for Rural Development & Research Takshashila Junior College, Sanver Road, Post Navakheda, Ujjain बनाम/ Vs. CIT(A), NFAC, Delhi (Assessee/Appellant) (Revenue/Respond ent) PAN: AAQFS8142R Assessee by Ms. Ruchira Nerkar, AR Revenue by Shri Ashish Porwal, Sr.DR Date of Hearing 12.03.2025 Date of Pronouncement 17.03.2025 आदेश / O R D E R Per Paresh M Joshi, J.M.: This is an appeal filed by the Assessee Under Section 253 of the Income Tax Act, 1961 (hereinafter referred to as the Act for sake of brevity) before this Tribunal as and by way second appeal. The assessee is aggrieved by order bearing Number ITBA/NFAC/S/ 250/2023-24/1056043913(1) dated 13.09.2023 Science Forum for Rural Development & Research Takshashila Junior College ITA No. 338/Ind/2024 A.Y. 2014-15 Page 2 of 9 passed by Ld. CIT(A), passed U/s 250 of the Act which is hereinafter referred to as the “impugned order”. The relevant Assessment Year is 2014-15 and the corresponding previous year period is from 01.04.2013 to 31.03.2014. At the outset registry has pointed out delay of 152 days. The Ld. AR for and on behalf of the assessee has taken us through condonation of delay application which is supported by affidavit in support of condonation of delay application. The Ld. AR inter alia has contended before us that assesse’s net-worth is poor/bad since some time now. There are now no students. In fact, they have applied for closure of institute. There are many administrative issues and also financial difficulties. There is liquidity crunch. No tuition fees are received. These contentions were raised basis documents i.e. balance sheets dated 31.03.2023 & 31.03.2024. Per contra Ld. DR has opposed condonation of delay but has not been successfully able to label the same basis documents. In view thereof, we condone the delay for which Science Forum for Rural Development & Research Takshashila Junior College ITA No. 338/Ind/2024 A.Y. 2014-15 Page 3 of 9 assessee has shown bonafide and reasonable cause. Delay condoned. Matter admitted and taken up for hearing. 2. FACTUAL MATRIX 2.1 That the return of Income (ROI) for Assessment Year 2014- 15 was filed on 31.10.2014 declaring total income at Rs.NIL. 2.2 That the case of the assessee was selected under scrutiny and assessment was done u/s 143(3) of the Act on 29.12.2016 and assessed income of Rs.1,17,65,000/- was determined. 2.3 That during the assessment proceedings the Assessing Officer passed order U/s 143(3) of the Act on 29.12.2016. In the said quantum assessment order at para No.4 it was found that the assessee Society/Trust had received loan in cash of Rs.20,000/- or of more amounts in a day which is a restricted/prohibited in terms of Section 269SS of the Act. 2.4 That the assessee was given opportunity to file his reply on proposed imposition of the penalty U/s 271D and 271E of the Act but neither the assessee filed any reply nor attended the proceedings in order to avail opportunity provided. Due to Science Forum for Rural Development & Research Takshashila Junior College ITA No. 338/Ind/2024 A.Y. 2014-15 Page 4 of 9 change of incumbency the assessee was once again given a fresh opportunity to file any reply to which assessee filed a reply which was not found to be suitable and satisfactory. 2.5 Assessee contended and claimed that no loan is received but it collected money on account of sale of books, dress materials etc. However this claim of the assessee was not found to be acceptable as from the statement of Profit & Loss accounts for the year ended 31.03.2014 of M/s Takshshila Institute for Management and Technology it is just not visible or seen that any expenses of books, dress materials etc. were incurred. Hence the assertion of the assessee that it collected money on account of sale of books, dress materials or argument/contention that it is payment from creditors does not hold good. Further revenue of M/s Takshshila Institute for Management and Technology is received from bus fee, hostel fee, hostel registration fee and mess fee. That there is no revenue received for books, dress materials. Further neither the assessee has spent for any books and dress materials nor the assessee has received any revenue for these items then how it can transfer to M/s Science Forum for Rural Science Forum for Rural Development & Research Takshashila Junior College ITA No. 338/Ind/2024 A.Y. 2014-15 Page 5 of 9 Development & Research on account for sale of books, dress materials (sale). Further the assessee books of accounts mentions that amounts are loan received in cash. 2.6 That in view of the aforesaid facts and discussions the Ld. A.O was satisfied that the assessee indeed had received loan in cash of Rs.20,000/- or more in a day which perse was violation of Section 269SS of the Act consequently penalty U/s 271D of the Act. 2.7 That Ld. A.O has levied penalty U/s 271D which is tabulated below:- Date of loan received Name of the persons to whom loan received in cash Sh./Smt. Penalty u/s 271D amount of loan received in cash Rs.20,000 or more 02.04.2013 Takshshila Institute of Management and Technology 3,35,000 11.10.2013 -do- 1,00,000 29.10.2013 -do- 3,35,000 10.11.2013 -do- 1,00,000 18.03.2014 -do- 1,95,000 Total penalty amount U/s 271D 10,85,000 2.8 That the aforesaid order of penalty by Ld. Assessing Officer U/s 271D is dated 22.09.2017 which is hereinafter referred to as the “impugned penalty order”. Science Forum for Rural Development & Research Takshashila Junior College ITA No. 338/Ind/2024 A.Y. 2014-15 Page 6 of 9 2.9 That the assessee being aggrieved by the aforesaid “impugned penalty order” prefers first appeal U/s 246A of the Act before Ld. CIT(A) who by the “impugned order” has dismissed the appeal of the assessee. The assessee being aggrieved by the “impugned order” has preferred this second appeal U/s 253 of the Act against the “impugned order” and has raised following grounds of appeal against the “impugned order” which are as under:- “1. That the Ld. CIT(A) erred in rejecting the reply filed by assessee. 2. The Ld. CIT(A) has never asked to submit Form no. 35, Grounds of Appeal, Statement of Facts, and Penalty Order. 3. That all the required paper, information was submitted by was not properly considered by Ld.CIT(A). 4. The Appellant craves leave to add/alter any of the grounds of appeal before at the time of hearing.” 3. Record of Hearing 3.1 The hearing in the appeal took place before this Tribunal on 12.03.2025 when Ld. DR brought to our notice that the “impugned order” is illegal, bad in law and not proper. It should therefore be set aside by this Tribunal. The Ld. AR pleaded that even in the “impugned penalty order” no opportunity was Science Forum for Rural Development & Research Takshashila Junior College ITA No. 338/Ind/2024 A.Y. 2014-15 Page 7 of 9 afforded to the assessee to fully represent it’s case and so also before Ld. CIT(A) hence there is violation of the principles of natural justice vitiating the “impugned order”. The Ld. AR pleaded that if one more opportunity is afforded to the assessee before Ld. CIT(A) as last and final opportunity they would furnish each and every details which Ld. CIT(A) may desire. Per contra Ld. DR for and on behalf of the Revenue interalia also stated that Revenue has no objection if this Tribunal desires to remand back the matter back to the file of Ld. CIT(A). 4. Observations & findings & conclusions 4.1 We now have to decide the legality, validity and proprietary of the “impugned order” basis records of the case and after examining rival contentions canvassed before us. 4.2 After examining the records of the case minutely we are of the considered view that in order to meet the ends of justice or more opportunity as and by way of final opportunity should be afforded to the assessee to fully represent its case for Ld. CIT(A). The assessee is directed to place on record before Ld. CIT(A) Form No.35, statement of facts, grounds of appeal and such other Science Forum for Rural Development & Research Takshashila Junior College ITA No. 338/Ind/2024 A.Y. 2014-15 Page 8 of 9 documentary evidence in support. The Ld. CIT(A) to give one more opportunity to assessee as and by way of final opportunity before adjudicating and adjudicating first appeal. The assessee shall cooperate with Department and shall not seek any unnecessary adjournment. The Ld. CIT(A) is also directed to decide first appeal as expeditiously as possible. 5. Order 5.1 In the premises drawn by us, we set aside the impugned order as and by way of Remand on Denova basis. 5.2 In result appeal of assessee is allowed for statistical purpose. Order pronounced in open court on 17.03.2025. Sd/- Sd/- (BHAGIRATH MAL BIYANI) (PARESH M JOSHI) ACCOUNTANT MEMBER JUDICIAL MEMBER Indore िदनांक /Dated : 17/03/2025 Dev/Sr. PS Science Forum for Rural Development & Research Takshashila Junior College ITA No. 338/Ind/2024 A.Y. 2014-15 Page 9 of 9 Copies to: (1) The appellant (2) The respondent (3) CIT (4) CIT(A) (5) Departmental Representative (6) Guard File By order UE COPY Senior Private Secretary Income Tax Appellate Tribunal Indore Bench, Indore "