VASANTRAO NAIK SHIKSHAN PRASARAK MANDAL,AURANGABAD V. ACIT EXEMPTION CIRCLE, AURNGABAD

ITA 2149/PUN/2025

AI Insights

The case involves Vasantrao Naik Shikshan Prasarak Mandal, an educational institution, which appealed against the order of the CIT(A)/NFAC concerning the Assessment Year 2017-18. The institution, registered under the Maharashtra Public Trust Act and Societies Registration Act, claimed exemption under section 10(23C)(iiiab) of the Income Tax Act, 1961, declaring nil income and was subjected to scrutiny. The AO made an addition of Rs.55,17,490 to the assessee's income, citing unexplained credits. The CIT(A) reduced this amount but did not admit additional evidences provided by the assessee. The Tribunal found that the additional evidences were crucial for a fair assessment and directed the AO to reconsider the case with these evidences.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 840383 (ITAT-PUNE)
• Duration Of Justice: 5 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-02-2026
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2017-2018
• Appeal Filed On: 17-09-2025
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PRAMOD SHAHAKAR
• Assessee Lawyers: RAVINDRA S. DAREKAR
• Keywords: Set aside; Opportunity of being heard; Additional evidence; Unexplained cash credit
• Section: 143(3); 142(1); 68

Judgement Text

" आयकर अपीलीय अधिकरण “बी” न्यायपीठ पुणे में । IN THE INCOME TAX APPELLATE TRIBUNAL “B” BENCH, PUNE BEFORE SHRI MANISH BORAD, ACCOUNTANT MEMBER AND MS. ASTHA CHANDRA, JUDICIAL MEMBER आयकर अपील सं. / ITA No.2149/PUN/2025 धििाारण वर्ा / Assessment Year : 2017-18 Vasantrao Naik Shikshan Prasarak Mandal, Near Airport Office, Chikalthana Road, Aurangabad – 431003 PAN : AAATV1713H Vs. ACIT, Exemption Circle, Aurangabad अपीलार्थी / Appellant प्रत्यर्थी / Respondent Assessee by : Shri Ravindra S. Darekar Department by : Shri Pramod Shahakar Date of hearing : 11-02-2026 Date of Pronouncement : 23-02-2026 आदेश / ORDER PER ASTHA CHANDRA, JM : The appeal filed by the assessee is directed against the order dated 01.08.2025 of the Ld. Commissioner of Income Tax (Appeals)/NFAC, Delhi [“CIT(A)/NFAC”] pertaining to Assessment Year (“AY”) 2017-18. 2. Briefly stated, the facts of the case are that the assessee is an educational institution registered under the Maharashtra Public Trust Act, 1950 and Societies Registration Act, 1860. It runs by fees collected from students, donation received and Government grants. For AY 2017-18, the assessee filed its return of income on 26.10.2017 u/s 139(1) of the Income Tax Act, 1961 (the “Act”) declaring Nil income and claiming exemption u/s 10(23C) (iiiab) of the Act. The case of the assessee was selected for scrutiny under CASS. Accordingly, statutory notice(s) u/s 143(2) and 142(1) of the Act along with questionnaire as well as show cause notice were issued and served upon the assessee from time to time which were not complied with. The Ld. Assessing Officer (“AO”) therefore completed the assessment on the basis of material available on record vide his order Printed from counselvise.com 2 ITA No.2149/PUN/2025, AY 2017-18 dated 12.12.2019 passed u/s 143(3) of the Act determining the total income of the assessee at Rs.55,17,490/- including therein addition made on account of unexplained credits in the books of account of the assessee u/s 68 of the Act. 3. Aggrieved, the assessee filed an appeal before the Ld. CIT(A)/NFAC. During the appellate proceeding before the Ld. CIT(A)/NFAC, the assessee filed certain additional evidences in support of its claim against the above addition made by the Ld. AO. However, the Ld. CIT(A)/NFAC did not admit the additional evidences filed by the assessee observing that the assessee’s case does not fulfill the conditions prescribed in Rule 46A of the Income Tax Rules, 1962. It was also contended that since the assessee is a trust the income/donation even if considered anonymous should be taxed u/s 115BBC of the Act and not u/s 68 of the Act which was accepted by the Ld. CIT(A)/NFAC. The Ld. CIT(A)/NFAC partly allowed the appeal of the assessee by restricting the addition of Rs.55,17,488/- made by the Ld. AO to Rs.18,40,438/- observing that the amount of Rs.36,77,080/- pertains to FY 2015-16 and directed the Ld. AO to tax the income of the assessee u/s 115BBC of the Act for the relevant AY 2017-18 under consideration. 4. We have heard the Ld. Representatives of the parties and perused the material on record. We observed that the Ld. AO has completed the assessment ex-parte qua the assessee u/s 143(3) of the Act vide his order dated 12.12.2019 on account of assessee’s failure to comply with the notices issued to the assessee. The Ld. AR has submitted that the non- compliance before the Ld. AO was not intentional. He submitted that notices were not communicated in time by the staff of the assessee trust due to which the assessee could not make any submissions before the Ld. AO. Therefore, on the basis of material available on record, the Ld. AO passed the impugned assessment order and made an addition of Rs.55,17,490/- comprising of - (i) cash donation amounting to Rs.6,01,000/- u/s 68 r.w.s. 115BBC of the Act and (ii) balance corpus donation amounting to Rs.49,16,488/- on account of assessee’s failure to prove the genuineness, identity and creditworthiness of the donors by filing the supporting documentary evidences. We further observe that the Ld. CIT(A)/NFAC did not admit the additional evidences filed by the assessee before him and out of the total addition of Rs.55,17,490/- made by the Ld. Printed from counselvise.com 3 ITA No.2149/PUN/2025, AY 2017-18 AO restricted the addition to Rs.18,40,438/- and gave relief to the assessee to the extent of Rs.36,77,080/- which represented the opening balance in the relevant corpus donations account as on 01.04.2016. The Ld. CIT(A)/NFAC also rejected the claim of exemption u/s 10(23C)(iiiab) on the ground that the assessee is a trust and not an educational institution. The Ld. AR submitted that the assessee claimed exemption u/s 10(23C)(iiiab) of the Act as it is an educational institution substantially financed by the State Government. Approximately 85% of grants to the total receipt are from Government grants received during the year under consideration (page 12 of the paper book refers). This fact was never disputed earlier and it has been accepted by the Department in the preceding AYs. He brought to our attention a chart of Government grants received by various units of educational institutions run by the assessee along with bank statements which was submitted before the Ld. CIT(A)/NFAC and pleaded that the same has not been considered by the Ld. CIT(A)/NFAC. 5. The Ld. AR also submitted that during the relevant AY under consideration no anonymous donations were received by the assessee. Referring to pages 80 to 180 of the paper book, the Ld. AR submitted that the details of all the donors along with receipt No., date of receipt, address and contact numbers of donors, Aadhar No. of donors were filed before the Ld. CIT(A)/NFAC explaining the source of Rs.18,40,438/-. Referring to pages 181 to 189 of the paper book, he submitted that the list of ordinary donations and building donations received during the AY under consideration by the assessee was also provided to the Ld. CIT(A)/NFAC. 6. No doubt, these documents referred to by the Ld. AR are additional evidences which were not produced at the time of assessment proceedings before the Ld. AO. The Ld. CIT(A)/NFAC declined to admit the additional evidences for the reasons given by him in para 6.1 to 6.2.2 of his appellate order and confirmed the addition made by the Ld. AO to the extent of Rs.18,40,438/- u/s 68 r.w.s. 115BBC of the Act. It is the contention of the Ld. Counsel for the assessee that the above additional evidences go to the root of the matter and are necessary for adjudication of the appeal. Since no representation could be made earlier by the assessee before the Ld. AO, he urged that the matter may be restored back to the file of the Ld. AO for verification and decision afresh. The Ld. DR had no objection thereto. Printed from counselvise.com 4 ITA No.2149/PUN/2025, AY 2017-18 7. Considering the totality of the facts and in the circumstances of the case, we of the view that it is essential in the interest of justice and fair play, to consider the additional evidences placed before the Ld. CIT(A)/NFAC which he declined to admit. Since, both the parties have agreed that the matter be resend to the Ld. AO, we set aside the order of the Ld. CIT(A)/NFAC and restore the matter back to the file of the Ld. AO with a direction to him to consider the material already on records and additional evidences filed before the Ld. CIT(A)/NFAC and also hold further enquiries/verification if need be and decide the issues afresh in light of the result of such enquiries/ verification. Needless to say, the Ld. AO shall afford reasonable opportunity of being heard to the assessee during the fresh assessment proceedings before him. We direct and order accordingly. The grounds raised by the assessee are thus allowed for statistical purposes. 8. In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open court on 23rd February, 2026. Sd/- Sd/- (Manish Borad) (Astha Chandra) ACCOUNTANT MEMBER JUDICIAL MEMBER पुणे / Pune; दिन ांक / Dated : 23rd February, 2026. रदि आदेश की प्रधिधलधप अग्रेधर्ि / Copy of the Order forwarded to : 1. अपील र्थी / The Appellant. 2. प्रत्यर्थी / The Respondent. 3. The Pr. CIT concerned. 4. दिभ गीय प्रदिदनदि, आयकर अपीलीय अदिकरण, “बी” बेंच, पुणे / DR, ITAT, “B” Bench, Pune. 5. ग र्ड फ़ इल / Guard File. //सत्य दपि प्रदि// True Copy// आिेश नुस र / BY ORDER, सहायक पंजीकार/ Assistant Registrar आयकर अपीलीय अदिकरण ,पुणे / ITAT, Pune Printed from counselvise.com "