Krishna Geetanjli Foundation Society, New Delhi v. DIT(E), New Delhi

ITA 3106/DEL/2009 | misc
Pronouncement Date: 28-01-2011 | Result: Allowed

Appeal Details

RSA Number 310620114 RSA 2009
Bench Delhi
Appeal Number ITA 3106/DEL/2009
Duration Of Justice 1 year(s) 6 month(s) 22 day(s)
Appellant Krishna Geetanjli Foundation Society, New Delhi
Respondent DIT(E), New Delhi
Appeal Type Income Tax Appeal
Pronouncement Date 28-01-2011
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted D
Tribunal Order Date 28-01-2011
Date Of Final Hearing 14-01-2011
Next Hearing Date 14-01-2011
Assessment Year misc
Appeal Filed On 06-07-2009
Judgment Text
I.T.A. NO.3694-3106 /DEL/08-09 1/6 IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH D NEW DELHI) BEFORE SHRI I.P. BANSAL JUDICIAL MEMBER AND SHRI A.K. GARODIA ACCOUNTANT MEMBER I.T.A. NO.3694/DEL/2008 ASSESSMENT YEAR : 2003-04 ITO (EXEMPTION) M/S KRISHNA GEETANJALI TRUST WARD-IV FOUNDATION SOCIETY DELHI. V. 7-KAPIL VIHAR PITAM PURA NEW DELHI. I.T.A. NO.3106/DEL/2009 ASSESSMENT YEAR: KRISHNA GEETANJALI DIT(E) FOUNDATION SOCIETY PLOT NOI.15 3 RD FLOOR CD-158 PITAM PURA. NEW DELHI. NEW DELHI. V. (APPELLANT) (RESPONDENT) PAN /GIR/NO. PAN /GIR/NO. PAN /GIR/NO. PAN /GIR/NO.AAATK AAATK AAATK AAATK- -- -3531 3531 3531 3531- -- -A AA A APPELLANT BY : SHRI A.K. MONGA.DR. RESPONDENT BY : SHRI RAJESH JAIN C.A. ORDER PER A.K. GARODIA AM: THERE IS ONE APPEAL OF THE REVENUE FOR ASSESSMENT YEAR 2 003-04 DIRECTED AGAINST THE ORDER OF LD CIT(A) XXI NEW DE LHI DATED 15.9.2008 AND THE REMAINING APPEAL IS OF THE ASSESSEE I N WHICH THE ASSESSEE IS DISPUTING THE ORDER OF LD DIT (E) NEW DELHI DATED 16.7.2009 U/S 12AA(3) OF THE INCOME TAX ACT 1961 CA NCELLING THE . I.T.A. NO.3694-3106-/DEL/08-09 2/6 REGISTRATION OF THE ASSESSEE W.E.F. 1.4.2002. BOTH THE A PPEALS WERE HEARD TOGETHER AND ARE BEING DISPOSED OFF BY THIS COMM ON ORDER FOR THE SAKE OF CONVENIENCE. 2. BRIEF FACTS OF THE CASE ARE THAT IN THE ASSESSMENT ORD ER FOR ASSESSMENT YEAR 2003-04 IT IS NOTED BY THE ASSESSING OFFICE R THAT AN INFORMATION WAS RECEIVED FROM DIRECTOR OF INCOME TAX (INV.) NEW DELHI VIDE HIS LETTER DATED 2.3.2006 THAT THE ASSESSEE HAS TAKE N VARIOUS ACCOMMODATION ENTRIES FROM THE ENTRY OPERATOR DURING THIS YEAR. DETAILS OF THESE ENTRIES ARE NOTED BY THE ASSESSING OFFICE R ON PAGE NO.1 & 2 OF THE ASSESSMENT ORDER AS PER WHICH THE ASSESSEE H AS RECEIVED AN AMOUNT OF `.13.64 LAKHS FROM 14 PERSONS. T HE ASSESSING OFFICER INITIATED THE RE-ASSESSMENT PROCEEDINGS AFTER RE CORDING THE REASONS. IT IS FURTHER NOTED BY THE ASSESSING OFFICER IN T HE RE- ASSESSMENT ORDER THAT IN ADDITION OF 14 ENTRIES OF `.13. 46 LAKHS THE ASSESSEE HAS ALSO RECEIVED AN AMOUNT OF `.5.63 LAKHS FROM SIX DIFFERENT PERSONS AND IN THIS MANNER THE ASSESSEE HAS RECEIVED TOTA L AMOUNT OF `.19.27 LAKHS FROM 20 PERSONS. THE ASSESSING OFFICER ISSUE D NOTICES TO THESE PERSONS U/S 133(6) OF THE ACT. IT IS NOTED BY THE ASSESSING OFFICER IN THE ASSESSMENT ORDER THAT SUCH NOTICES WERE R ETURNED UN- SERVED IN THE CASE OF 17 PARTIES. IT IS NOTED BY THE ASSE SSING OFFICER THAT THE NOTICES U/S 133(6) WERE NOT RECEIVED BACK I N CASES OF THREE PARTIES BUT THERE WAS NO COMPLIANCE BY THEM ALSO. THE ASSESSING OFFICER ASKED THE ASSESSEE TO FURNISH CORRECT ADDRESS OF AL L THE PARTIES OR TO PRODUCE ALL THE PARTIES BEFORE HIM. THEREAFTE R IT IS NOTED BY THE ASSESSING OFFICER THAT ON 22.11.2007 THE AR OF THE ASSESSE E APPEARED AND FILED A NEW LIST OF DONORS WITH THEIR NEW ADDRESSES . THE ASSESSING OFFICER HAD NOTED THAT SINCE IT WAS A TIME BARRING CA SE AND THE TIME AVAILABLE WAS NOT SUFFICIENT TO MAKE ENQUIRY DIRECTL Y HE ASKED THE AR OF THE ASSESSEE TO PRODUCE ALL THE DONORS ON 28.11.2007 AND 2911.2007 WITH THEIR IDENTIFICATION AND INCOME TAX RECORDS. IT IS . I.T.A. NO.3694-3106-/DEL/08-09 3/6 FURTHER NOTED BY THE ASSESSING OFFICER THAT ON THE APPO INTED DATE NOT A SINGLE PERSON APPEARED FOR VERIFICATION IN THE CASE. THE ASSESSING OFFICER MADE ADDITION OF `.19 98 582/- U/S 68 OF THE ACT ON ACCOUNT OF DONATIONS RECEIVED FROM VARIOUS PERSONS BY THE ASSESSEE DUR ING THIS YEAR. THE ASSESSING OFFICER ALSO ADDED FURTHER AMOUNT OF `.99 929/- BY ALLEGING THAT THE ASSESSEE MUST HAVE PAID COMMISSION OF 5% TO GET THESE ACCOMMODATION ENTRIES. BEING AGGRIEVED THE ASSES SEE CARRIED THE MATTER IN APPEAL BEFORE LD CIT (A) WHO HAS DELET ED THIS ADDITION AND NOW THE REVENUE IS IN APPEAL BEFORE US. IN ADDIT ION TO THESE FACTS LD DIT (E) HAS INITIATED PROCEEDINGS U/S 12AA(3) OF THE INCOME TAX ACT 1961 AFTER THE COMPLETION OF THE ASSESSMENT IN ASSESSMENT Y EAR 2003- 04 IN WHICH IT WAS HELD BY THE ASSESSING OFFICER THAT TH E ASSESSEE HAD ARRANGED DONATION OF `.19.99 LAKHS THROUGH SEVERAL PA RTIES WHOM IT COULD NOT PRODUCE AND COULD NOT PROVE THE GENUINENE SS OF THE DONATION. AFTER HEARING THE ASSESSEE IN THESE PROCEEDING S INITIATED BY HIM U/S 12AA(3) OF THE ACT HE HELD THAT IN VIEW OF THE ACTIVITIES OF THE ASSESSEE OF ARRANGING DONATION BY CONVERTING BLACK MONE Y INTO DONATION WHICH HAS COME UP TO LIGHT IN FINANCIAL YE AR 2002-03 AS PER ASSESSMENT ORDER PASSED ON 28.12.2007 ACTIVITIES OF THE A SSESSEE ARE NO LONGER CHARITABLE W.E.F. 1.4.2002 AND HENCE REGI STRATION GRANTED TO THE ASSESSEE U/S 12A IS THEREFORE CANCELLED W.E.F. 1.4.20 02. THE ASSESSEE IS IN APPEAL BEFORE US AGAINST THIS ORDER OF LD D IT(E) DELHI. 3. IN THE COURSE OF HEARING BEFORE US VARIOUS ARGUMEN TS WERE MADE BY BOTH SIDES REGARDING GENUINENESS OF THE DONATION REC EIVED BY THE ASSESSEE IN ASSESSMENT YEAR 2003-04. THE ATTENTION OF THE LD AR OF THE ASSESSEE DRAWN TO PARA NO.3 OF PAGE NO.4 OF THE ORD ER OF LD DIT(E) AS PER WHICH IT IS NOTED BY THE LD DIT(E) THAT THE A SSESSEE HAS REFUSED TO PRODUCE THE DONORS BEFORE HIM ALSO. IN REPLY IT WAS SUBMITTED BY THE LD AR OF THE ASSESSEE THAT IF ONE MORE OPPORTUNITY IS ALLOWED TO THE ASSESSEE THE ASSESSEE WILL BE IN A POSITION TO PRODUCE DONORS . I.T.A. NO.3694-3106-/DEL/08-09 4/6 BEFORE THE REVENUE AUTHORITIES AND HE SUBMITTED AN AF FIDAVIT OF SHRI GURCHARAN SINGH SECRETARY OF THE ASSESSEE SOCIETY. IN THIS AFFIDAVIT IT HAS BEEN UNDERTAKEN THAT THE ASSESSEE WILL NOW PRODUCE THESE DONORS BEFORE THE REVENUE AUTHORITIES. IN THE LIGHT OF THIS AFFIDAVIT BY THE SECRETARY OF THE ASSESSEE SOCIETY WE ARE OF THE CONSIDE RED OPINION THAT IN THE INTEREST OF JUSTICE ONE MORE OPPORTUNITY MAY BE ALLOWED TO THE ASSESSEE TO PRODUCE ALL THE DONORS BEFORE THE REVEN UE AUTHORITIES TO PROVE ITS CASE THAT THE DONATIONS IN QUESTION ARE NO T BOGUS. SINCE THE ASSESSMENT ORDER IN ASSESSMENT YEAR 2003-04 AND THE ORD ER OF LD DIT(E) FOR WITHDRAWAL OF REGISTRATION ARE BASED ON TH IS FINDING THAT THESE DONATIONS ARE BOGUS BOTH THESE MATTERS HAVE TO GO BACK FOR A FRESH DECISION AND ACCORDINGLY WE SET ASIDE THE ORDER OF LD DIT(E) IN ASSESSMENT YEAR 2003-04 AND RESTORE THE MATTER BACK TO T HE FILE OF THE ASSESSING OFFICER FOR A FRESH DECISION. THE ASSESSEE HAS TO PR ODUCE THE DONORS BEFORE THE ASSESSING OFFICER TO PROVE ITS CASE THA T THE DONATIONS IN QUESTION ARE GENUINE AND NOT BOGUS. AFTER PROVIDING ADEQUATE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE TH E ASSESSING OFFICER SHOULD DECIDE THIS ISSUE AFRESH AND PASS NECESSARY O RDER AS PER LAW. THE APPEAL OF THE REVENUE STANDS ALLOWED FOR STAT ISTICAL PURPOSES. 4. WE ALSO SET ASIDE THE ORDER OF THE LD DIT(E) PASSED B Y HIM U/S 12AA(3) OF THE ACT BECAUSE THE VERY BASIS OF HIS ORDER IS THAT THE DONATIONS DECLARED BY THE ASSESSEE IN ASSESSMENT YEAR 2003-0 4 ARE HELD TO BE BOGUS BY THE ASSESSING OFFICER IN THE ASSESSMENT OF THAT YEAR. SINCE THIS ISSUE HAS BEEN RESTORED BACK BY US TO THE FILE OF THE ASSESSING OFFICER FOR A FRESH DECISION IN THAT YEAR WE F EEL THAT IT WILL BE IN THE FITNESS OF THINGS THAT LD DIT(E) DECIDES THIS ISSUE AFRESH AFTER PASSING OF THE ASSESSMENT ORDER AFRESH BY THE ASSESSING OFFICE R IN THE ASSESSMENT YEAR 2003-04 IN PURSUANCE TO OUR DIRECTION. W HILE PASSING THE FRESH ORDER IF IT IS FOUND THAT THE ASSESSING OFFICE R HAS ACCEPTED THE GENUINENESS OF THE DONATIONS IN ASSESSMENT YEAR 2003- 04 THEN . I.T.A. NO.3694-3106-/DEL/08-09 5/6 THERE IS NO CASE FOR WITHDRAWAL OF REGISTRATION GRANTE D TO THE ASSESSEE BUT IF IT IS FOUND THAT SUCH DONATIONS ARE NOT FOUND T O BE GENUINE BY THE ASSESSING OFFICER IN THE ASSESSMENT YEAR 2003-04 THEN L D DIT (E) SHOULD PASS FRESH ORDER AS PER LAW AND WHILE DOING SO H E SHOULD ALSO CONSIDER VARIOUS OTHER OBJECTIONS OF THE ASSESSEE AS TO WHE THER HE CAN WITHDRAW THE REGISTRATION WHICH WAS GRANTED TO THE A SSESSEE U/S 12A SINCE THE AMENDMENT IN THIS REGARD IN SECTION 12AA (3) OF THE ACT IS EFFECTED BY THE FINANCE ACT 2010 W.E.F. 1.6.2010 W HEREAS THE IMPUGNED ORDER HAS BEEN PASSED BY HIM ON 16.6.2009 THA T TOO W.E.F. 1.4.2002. 5. LD DIT (E) SHOULD PASS FRESH ORDER AS PER LAW AFTER P ROVIDING ADEQUATE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 6. IN THE RESULT THE APPEAL OF THE REVENUE AS WELL A S THE APPEAL OF THE ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. 7. ORDER PRONOUNCED IN THE OPEN COURT ON 28TH JANUA RY 2011. SD/- SD/- (I.P. BANSAL) (A.K. GARODIA) JUDICIAL MEMBER ACCOUNTANT MEMBER DT. 28. .1.2011. HMS COPY FORWARDED TO:- 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT (A)- NEW DELHI. 5. THE DR ITAT LOKNAYAK BHAWAN KHAN MARKET NEW DEL HI. TRUE COPY. BY ORDER (ITAT NEW DELHI). . I.T.A. NO.3694-3106-/DEL/08-09 6/6