St Josephs FCC Province Thalassery V. The Income Tax Officer, Exemption Ward, Kannur and The Commissioner of Income Tax (Exemption), Ernakulam and The Principal Chief Commissioner of Income Tax (Exemption), New Delhi and The Principal Chief Commissioner of Income Tax, Kozhikode

WP(C)/12460/2023

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The case involves St Josephs FCC Province Thalassery, represented by its Provincial Superior Sr. Noble, challenging the order passed by the Income Tax Officer, Exemption Ward, Kannur, which included previous year's bank deposits in the current year's turnover, leading to a taxable income assessment. The petitioner argued that the inclusion of Rs. 9,45,475.96 from the previous year's deposits in the turnover for the Assessment Year 2016-17 was erroneous. The Revenue did not dispute this fact. The court, recognizing the mistake, set aside the impugned orders, thereby allowing the petition.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 816007 (HC-KERALA)
• Appeal Type: Others
• Pronouncement Date: 12-10-2023
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Applicant
• Court: HIGH COURT
• Department Lawyers: JOSE JOSEPH
• Assessee Lawyers: S RAJ; ARJUN RAJ; C T SUJA
• Keywords: Annual receipts; Assessment Year 2016-17; Educational institution; Income tax exemption
• Section: 148; 12AA; 10(23C)(iiiad); 148A(b); 148A(d)

Judgement Text

"IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE DINESH KUMAR SINGH THURSDAY, THE 12TH DAY OF OCTOBER 2023 / 20TH ASWINA, 1945 WP(C) NO. 12460 OF 2023 PETITIONER/S: ST JOSEPHS FCC PROVINCE THALASSERY, JYOTHI BHAVAN, MELECHOVVA, KANNUR-670006, REPRESENTED BY ITS PROVINCIAL SUPERIOR SR. NOBLE. BY ADVS. S.ARUN RAJ; ARJUN S.RAJ; C.T.SUJA RESPONDENT/S: 1 THE INCOME TAX OFFICER, EXEMPTION WARD, AAYAKAR BHAVAN, KANNUR-670006 2 THE COMMISSIONER OF INCOME TAX (EXEMPTION), 2ND FLOOR, SANJUAN TOWERS, OLD RAILWAY STATION ROAD, ERNAKULAM, COCHIN 682018 3 THE PRINCIPAL CHIEF COMMISSIONER OF INCOME TAX (EXEMPTION), 25TH FLOOR, E-2, BLOCK, PRATHYAKSH KAR BHAWAN CIVIC CENTRE, JAWAHARLAL NEHRU MARG, NEW DELHI - 110002 4 THE PRINCIPAL CHIEF COMMISSIONER OF INCOME TAX, AAYAKAR BHAVAN, MANANCHIRA, KOZHIKODE -673001 BY ADV JOSE JOSEPH, SC, INCOME TAX DEPARTMENT, KERALA CHRISTOPHER ABRAHAM-SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 12.10.2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: W.P.(C) No.12460/2023 -2- J U D G M E N T The present writ petition has been filed by the petitioner assessee impugning the order dated 22.03.2023 (Ext.P5) passed by the Income Tax Officer, Exemption Ward, Kannur, whereby the petitioner’s turnover as per the receipts and payments statement has been taken to be Rs.1,02,85,571/- for the Assessment Year 2016-17, and found it to be a fit case for issuing of notice under Section 148 of the Income Tax Act, 1961. Section 10(23C)(iiiad) of the Income Tax Act 1961, at the relevant time, provided that any income received by a person on behalf of any university or other educational institution existing solely for educational purposes and not for purposes of profit, and if the aggregate annual receipts did not exceed Rs. 1 crore, it should be exempted from payment of income tax. W.P.(C) No.12460/2023 -3- 2. Learned Counsel for the petitioner submits that the annual receipt taken by the Assessing Officer of Rs.1,02,85,571/- would include bank deposits of the previous year of Rs.9,45,475.96, including some cash at hand. He, therefore, submits that if this Rs.9,45,475.96 is excluded, which is not the receipt of the current year, the annual receipt for the Assessment Year 2016-17 would be less than Rs. 1 crore. 3. Mr Christopher Abraham, learned Standing Counsel for the Revenue, does not dispute the fact that Rs.1,02,85,571/- include the deposit balance of the previous year of Rs.9,45,475.96. 4. Since there is a mistake apparent on the face of the record as the Assessing Officer has taken the previous year's balance into account while computing the total receipt in the Assessment Year 2016-17, the orders impugned (Exts.P5 and P6) appear to be incorrect. Therefore, the same are set aside. W.P.(C) No.12460/2023 -4- The present writ petition, therefore, stands allowed. Sd/- DINESH KUMAR SINGH JUDGE jjj W.P.(C) No.12460/2023 -5- APPENDIX OF WP(C) 12460/2023 PETITIONER EXHIBITS Exhibit P1 A TRUE COPY OF THE ORDER DATED 31-5-2018 ISSUED UNDER SECTION 12AA OF THE IT ACT BY THE COMMISSIONER OF INCOME TAX (EXEMPTIONS), KOCHI, THE 2ND RESPONDENT Exhibit P2 A TRUE COPY OF THE NOTICE DATED 15-2-2023 UNDER SECTION 148A(B) OF IT ACT FOR THE AY 2016-17 ISSUED BY THE 1ST RESPONDENT. Exhibit P3 A TRUE COPY OF THE REPLY DATED 22-2-2023 FILED BY THE PETITIONER IN RESPONSE TO EXHIBIT P-2 NOTICE Exhibit P4 A TRUE COPY OF THE AUDITED STATEMENT FOR THE YEAR ENDED 31ST MARCH 2016 OF ST JOSEPHS HIGH SCHOOL, PUSHPAGIRI, TALIMPARAMBA, SUBMITTED AS ANNEXURE A IN EXHIBIT P-3 REPLY LETTER. Exhibit P5 A TRUE COPY OF ORDER DATED 22-3-2023 PASSED UNDER SECTION 148 A (D) OF THE IT ACT FOR THE AY 2016-17 Exhibit P6 A TRUE COPY OF THE NOTICE DATED 22-3-2023 UNDER SECTION148 OF THE IT ACT ISSUED BY THE 1ST RESPONDENT FOR THE AY 2016-17 "