SRI SHIVAGANGA YOGA CENTRE,SHIVAMOGGA V. INCOME TAX OFFICER(EXEMPTIONS), WARD-1, HUBLI

ITA 1044/BANG/2025

AI Insights

The case involves the Shivaganga Yoga Centre, a charitable trust, which appealed against the rejection of their exemption claim under section 10(23C)(iiiad) of the Income Tax Act, 1961, for the assessment year 2019-20. The Central Processing Centre (CPC) initially rejected the claim due to non-selection of the appropriate dropdown in the tax return software and non-filing of mandatory schedule IE4, despite the trust's income being below the threshold of one crore rupees. The Income Tax Officer (ITO) and the CIT(A) upheld this rejection, leading to the appeal before the Tribunal. The Tribunal found that the issues were debatable and not suitable for rectification under section 154, thus allowing the appeal and directing the ITO to verify and possibly grant the exemption claimed.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 822458 (ITAT-BANGALORE)
• Duration Of Justice: 7 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-12-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2019-2020
• Appeal Filed On: 05-05-2025
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: GANESH R. GHALE; STANDING COUNSEL
• Assessee Lawyers: GOWRISH
• Keywords: Rectification of order; Charitable institution
• Section: 154; 10

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH : BANGALORE BEFORE SHRI PRASHANT MAHARISHI, VICE PRESIDENT ITA No.1044/Bang/2025 Assessment year : 2019-20 Sri Shivaganga Yoga Centre, (Abhistavara Vinayaka Temple Front), Kallahalli, Vinobanagara, Shivamogga – 577 204. PAN: AAHTS 6387H Vs. The Income Tax Officer (Exemption), Exemptions Ward 1, Hubli. APPELLANT RESPONDENT Appellant by : Shri Gowrish, CA Respondent by : Shri Ganesh R. Ghale, Advocate, Standing Counsel. Date of hearing : 24.11.2025 Date of Pronouncement : 22.12.2025 O R D E R 1. This appeal is filed by Shivaganga Yoga Centre (the assessee/appellant) for the assessment year 2019-20 against the appellate order passed by the Addl./JCIT(A), Madurai [ld. CIT(A)] dated 7.3.2025 wherein the appeal filed by the assessee against the rectification order passed u/s. 154 of the Income-tax Act, 1961 [the Printed from counselvise.com ITA No.1044/Bang/2025 Page 2 of 6 Act] dated 31.3.2023 by the ITO, Exemptions Ward 1, Hubli was dismissed. Aggrieved the assessee is in appeal before me. 2. The brief facts of the case show that assessee is a charitable trust running the Yoga Centre filed its return of income for assessment year 2019 – 20 on 19 August 2029 where the due date of filing of the return was 30 September 2019. The return of income was showing that while filing the return of income the assessee as per return of income claimed that an amount of ₹ 882,500/– is eligible for exemption under section 10 (23C) (iiiad) which was denied by the central processing Centre and computed the total income of the assessee at ₹ 883,010/–. The assessee aggrieved with the intimation dated 11 May 2020 preferred an rectification application on 23 January 2023 which was rejected on 31st of March 2023 stating the reason that the issue raised in application under section 154 of the act are debatable one and are beyond the scope of rectification under section 154 of the act. Aggrieved with the rejection of above rectification application assessee preferred an appeal before the learned CIT – A who disposed of the appeal of the assessee by order dated 7 March 2025 dismissing the appeal of the assessee and therefore assessee is in appeal before us. 3. Fact shows that the assessee trust got its accounts audited and filed return of income on 19 August 2019 with income of ₹ 510/– after claiming exemption towards postgraduate diploma course fee collected from students under section 10 (23) (iiiad) of ₹ 882,500. Central Processing Centre issued intimation under section 143 (1) of the act on Printed from counselvise.com ITA No.1044/Bang/2025 Page 3 of 6 11 May 2020 by declining exemption under section 10 (23)(iiiad) of the act stating reason that \" as per details in the return, the assessee has claimed exemption under section 10 (23) (iiiad) in part B – TI, however, the assessee has not selected the drop-down of under \" section under which exemption claimed \"under filing status in schedule personal information. Therefore exemption claimed in serial No. 9C in schedule part B – TI is not allowed. It was further stated that filing of schedule IE4 is mandatory and exemption under section 10 may not exceed the total receipt as per that schedule. As per rule 2BC exemption is allowed only if the aggregate annual receipt including any voluntary contribution during the relevant year does not exceed rupees one crore. 4. Assessee explained that it is using Winman utility software to file income tax return and the software are generated income tax return even when mandatory schedule IE 4 were not filed. The CPC accepted the return of income even when mandatory field were not filed. 5. Assessee preferred an application for rectification on 23 January 2013 under section 154 of the income tax act for the rectification apparent on record. This application was rejected for the reason that issue raised in application under section 154 which are debatable one and are beyond the scope of rectification under section 154 of the income tax act and therefore same was rejected. 6. The learned CIT-A held that the central processing Centre has correctly disallowed the exemption. He directed the assessee to file working of Printed from counselvise.com ITA No.1044/Bang/2025 Page 4 of 6 exemption allowable under section 11 as per form No. 10 B filed and the AO is directed to allow correct exemption. 7. We have heard both the parties and find that the application under section 154 was rejected for the reason that that the issue raised by the assessee in application under section 154 of the act are debatable one and it is beyond the scope of rectification under section 154 of the act. The fact in the law clearly shows that if the issue is debatable it could not have been adjusted under section 143 (1) of the act. For the simple reason we allow the appeal of the assessee. 8. However, merely because the assessee could not file the due columns in the return of income wherein the adequate information is otherwise available that the assessee is entitled to deduction under that section, the CPC would have found incongruity or inconsistency in various columns filed by the assessee in the return of income, but that does not make it possible adjustment under section 143 (1) of the act. The exact reason by the CPC for making the adjustment is \" as per the details in the return, the assessee has claimed exemption under section 10 (23C)(iiiad) in part B - TI , however the assessee has not selected the drop-down of 10 (23C)(iiiad) under \" section under which exemption claimed \"under filing status in schedule personal information. Hence exemption claimed in serial No. 9C in schedule part B -TI is not allowed. Further filing of schedule IE4 is mandatory. Exemption under section 10 May not exceed the total receipts as per schedule IE4 . As per rule 2BC exemption is allowed only if the aggregate annual receipts Printed from counselvise.com ITA No.1044/Bang/2025 Page 5 of 6 including any voluntary contributions during the relevant previous year does not exceed rupees one crore.\" On complete reading of the above reason it is apparent that it is not the inconsistency in the return of income but the relevant to drop-down menu is not selected. The assessee has also explained the reason why it could not be done. The assessee explained that even the annexure stated to be in the intimation was not filed however the claim of the assessee does not exceed rupees one crore. In view of the above facts we allow the claim of the assessee direct the learned assessing officer to allow the claim of the assessee of deduction/exemption under the respective section after verifying the facts. The learned CIT – A has also directed the assessee to claim deduction under section 11 of the act. The AO may also examine and if he finds that in one of the sections the deduction is available to the assessee where it is entitled according to the provisions of the law, he is directed to grant the same. 9. In the result appeal of the assessee is allowed for statistical purposes. Pronounced in the open court on this 22nd day of December, 2025. Sd/- ( PRASHANT MAHARISHI ) VICE PRESIDENT Bangalore, Dated, the 22nd December, 2025. /Desai S Murthy / Printed from counselvise.com ITA No.1044/Bang/2025 Page 6 of 6 Copy to: 1. Appellant 2. Respondent 3. Pr. CIT 4. CIT(A) 5. DR, ITAT, Bangalore. By order Assistant Registrar ITAT, Bangalore. Printed from counselvise.com "