UDAYA PROVINCIAL,THRISSUR V. ACIT(EXEMPTION), KOCHI

ITA 675/COCH/2024

AI Insights

The case involves Udaya Provincial House, a trust registered under section 12A of the Income Tax Act, 1961, which filed an appeal against the order of the Commissioner of Income Tax (Appeals)-9, Mumbai. The dispute centered on the assessment year 2017-18, where the AO had included a sum of Rs. 13,77,682 as revenue income, treating it as a non-corpus donation, and denied exemption under section 11 of the Act due to alleged violation of section 13(1)(c). The CIT(A) upheld the AO's decision regarding the inclusion of the foreign contribution as revenue income but allowed the exemption under section 11. The assessee contested the CIT(A)'s decision, leading to the current appeal.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 23434 (ITAT-COCHIN)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-01-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Assessment Year: 2017-2018
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: LEENA LAL
• Assessee Lawyers: NIVEDITHA KAMMATH
• Section: 143(3); 11; 12A

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH BEFORE SHRI INTURI RAMA RAO, AM ITA No. 675/Coch/2024 Assessment Year: 2017-18 Udaya Provincial House .......... Appellant 01, Thrissur Road, Irinjalakuda Thrissur 680125 [PAN: AABFU8995K] vs. Asst. Commissioner of Income Tax .......... Respondent (Exemption Circle), Kochi Appellant by: Ms. Niveditha Kammath, Advocate Respondent by: Smt. Leena Lal, Sr. D.R. Date of Hearing: 17.01.2025 Date of Pronouncement: 22.01.2025 O R D E R This appeal filed by the assessee is directed against the order of the Commissioner of Income Tax (Appeals)-9, Mumbai [CIT(A)] dated 21.05.2024 for Assessment Year (AY) 2017-18. 2. Brief facts of the case are that the assessee is a trust duly registered u/s. 12A of the Income Tax Act, 1961 (the Act). The return of income for AY 2017-18 was filed on 28.08.2017 declaring Nil income after claiming exemption u/s. 11 of the Act. 3. Against the said return of income, the assessment was completed by the ACIT (Exemption) (hereinafter called \"the AO\") 2 ITA No. 675/Coch/2024 Udaya Provincial House vide order dated 12.12.2019 passed u/s. 143(3) of the Act at a total income of Rs. 21,48,615/-. While doing so, the AO brought to tax a sum of Rs. 13,77,682/- being the amount of foreign contribution treating as non-corpus donation holding to be revenue income. The AO also denied exemption u/s. 11 of the Act on the ground that the appellant violated the condition of section 13(1)(c) of the Act. 4. Being aggrieved, an appeal was filed before the CIT(A), who vide the impugned order while allowing the exemption u/s. 11 of the Act, confirmed the action of the AO making addition of Rs. 13,77,682/- by holding that foreign contribution of Rs. 13,77,682/- should be treated as voluntary contribution in the absence of evidence that the contributions were made with specific purpose which shall form part of the corpus of the trust and institution. 5. Being aggrieved, the assessee in appeal before me in the present appeal. 6. It is submitted that the CIT(A), without considering the evidence, merely confirmed the action of the AO that the foreign contributions are voluntary contributions and, therefore, it is prayed that the matter may be remanded back to the file of the CIT(A) for de novo adjudication. 7. On the other hand, the learned Sr. DR raised objection for remand of the matter to the CIT(A) for de novo disposal. 3 ITA No. 675/Coch/2024 Udaya Provincial House 8. Having heard the rival submissions, I am of the considered opinion that in the interest of justice the matter should be restored to the file of the CIT(A) for de novo disposal in accordance with law after affording opportunity of hearing to the assessee. All the contentions raised by the assessee are kept open before the AO. 9. In the result, the appeal filed by the assessee stands partly allowed. Order pronounced in the open court on 22nd January, 2025. Sd/- (INTURI RAMA RAO) ACCOUNTANT MEMBER Cochin, Dated: 22nd January, 2025 n.p. Copy to: 1. The Appellant 2. The Respondent 3. The Pr. CIT concerned 4. The Sr. DR, ITAT, Cochin 5. Guard File By Order Assistant Registrar ITAT, Cochin "