M/s. Sahyog Jan Kalyan Samiti, Kanpur v. DCIT-I, Kanpur

ITA 494/LKW/2010 | 2006-2007
Pronouncement Date: 08-03-2011

Appeal Details

RSA Number 49423714 RSA 2010
Bench Lucknow
Appeal Number ITA 494/LKW/2010
Duration Of Justice 7 month(s) 23 day(s)
Appellant M/s. Sahyog Jan Kalyan Samiti, Kanpur
Respondent DCIT-I, Kanpur
Appeal Type Income Tax Appeal
Pronouncement Date 08-03-2011
Appeal Filed By Assessee
Bench Allotted B
Date Of Final Hearing 07-03-2011
Next Hearing Date 07-03-2011
Assessment Year 2006-2007
Appeal Filed On 16-07-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH B BENCH B BENCH B BENCH B LUCKNOW LUCKNOW LUCKNOW LUCKNOW BEFORE HONBLE SHRI H.L. KARWA BEFORE HONBLE SHRI H.L. KARWA BEFORE HONBLE SHRI H.L. KARWA BEFORE HONBLE SHRI H.L. KARWA AND HONBLE SHRI N.K. SAINI AND HONBLE SHRI N.K. SAINI AND HONBLE SHRI N.K. SAINI AND HONBLE SHRI N.K. SAINI ITA NO.494/LUC/2010 ASSESSMENT YEAR:2006-07 M/S SAHYOG JAN KALYAN SAMITI 122/619 SHANSTRI NAGAR KANPUR V. DCIT-I KANPUR PAN:AABAS0743G (APPELLANT) (RESPONDENT) ITA NO.496/LUC/2010 ASSESSMENT YEAR:2006-07 DCIT-I KANPUR V. M/S SAHYOG JAN KALYAN SAMITI 122/619 SHANSTRI NAGAR KANPUR PAN:AABAS0743G (APPELLANT) (RESPONDENT) ASSESSEE BY: SHRI G. N. SRIVASTAVA ADVOCATE DEPARTMENT BY SHRI ANADI VERMA D.R. O OO O R RR R D DD D E EE E R RR R PER PER PER PER H. L. KARWA H. L. KARWA H. L. KARWA H. L. KARWA: :: : THESE TWO APPEALS BY THE ASSESSEE AND THE REVENUE ARE DIRECTED AGAINST THE ORDER OF THE LD. CIT(A)-II KANPUR DATED 14.5.2010 RELATING TO ASSESSMENT YEAR 2006-07 2. IN ITA NO.494/LUC/2010 THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS:- 1. BECAUSE ON THE FACTS AND IN THE CIRCUMSTANCE OF THE CASE THE ORDER OF THE LEARNED CIT (A) - II KANPUR DATED 14.05.2010 AFTER COMPLETING THE HEARING ON 13.08.2009 WAS IMPROPER IN VIEW OF ADMINISTRATIVE I NSTRUCTIONS OF CBDT NEW DELHI OF PASSING APPELLATE ORDER WITHIN 15 DAYS OF THE DATE OF HEARING AID HENCE UNSUSTAINABLE. 2. BECAUSE ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE THE LEARNED CIT (A) ERRED IN DIRECTING THAT THE DONATIONS AMOUNTING TO RS.2 54 100.00 TO BE TREATED AS BOGUS AND ASSESSED UNDER THE HEAD INCOME FROM OTHER SOURCES AND NOT LIABLE TO BENEFIT U/S. 11 & 12 OF INCOME TA X ACT. 3. BECAUSE THE LEARNED CIT (A) ERRED ON FACTS AND IN L AW IN UPHOLDING :-2-: REFERENCE U/S. 142 A TO THE DVO AND IN CONFORMING U NEXPLAINED INVESTMENT IN BUILDING CONSTRUCTION AT RS.89 48 396.00. 4. BECAUSE THE LEARNED CIT (A) ERRED ON FACTS AND IN L AW IN CONFIRMING ALLEGED DISCREPANCY IN DEFERRED ADVERTISEMENT EXPENSES AT R S.16 98 723.00. 5. BECAUSE THE LEARNED CIT (A) ERRED ON FACTS AND IN L AW IN NOT CONSIDERING THE VARIOUS FACTS AND SUBMISSIONS MADE DURING THE C OURSE OF HEARING OF APPEAL. 6. BECAUSE THE LEARNED CIT (A) ERRED ON FACTS AND IN L AW IN CONFIRMING DISALLOWANCE OF RENT PAID TO SMT. NIRMALA SINGH AT RS.42 000.00. 7. BECAUSE THE ORDER OF THE LEARNED CIT (A) IS ERRONEO US AND BAD BOTH ON FACTS AND IN LAW. 3. IN ITA NO.496/LUC/2010 THE REVENUE HAS RAISED THE FOLLOWING GROUNDS:- 1. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-II KANPUR HAS ERRED IN LAW AND ON FACTS OF THE CASE IN DELETING THE ADDITI ON OF RS.2 40 000/- ON ACCOUNT OF FAIR RENTAL VALUE OF THE PLOTS OF LAND G IVEN TO THE MEMBERS OF THE FAMILY WITHOUT APPRECIATING THAT THE LEASEHOLD RIGH TS OF TENANTS WERE NEVER SURRENDERED BY THE TENANTS NOR ANY RESOLUTION WAS P ASSED BY THE SOCIETY FOR WITHDRAWING SUCH LEASEHOLD RIGHTS OF TENANTS. 2. THAT THE LD. COMMISSIONER OF INCOME TAX (APPEALS)-I I KANPUR HAS ERRED IN LAW AND ON FACTS OF THE CASE IN DIRECTING TO ACCEPT THE GENUINENESS OF SUCH DONATIONS IN RESPECT OF WHICH NUMBER OF DISCREPANC IES AND DEFECTS WERE BROUGHT ON RECORD BY THE ASSESSING OFFICER DURING T HE COURSE OF ASSESSMENT PROCEEDINGS. 3. THAT THE LD. COMMISSIONER OF INCOME TAX (APPEALS)-I I KANPUR HAS FAILED TO APPRECIATE THE FACTS THAT DURING THE COURSE OF A SSESSMENT PROCEEDINGS THE ASSESSING OFFICER HAD VERIFIED SOME OF THE DONORS O NLY ON TEST CHECK BASIS TO ESTABLISH THE TREND OF GENUINENESS OF THE TRANSACTI ONS AS IT WAS NOT FEASIBLE AND. LEGALLY CALLED FOR TO EXAMINE EACH AND EVERY D ONOR WHICH WERE MORE THAN 20 000/-. IN NUMBER. 4. THAT THE ORDER OF. THE LD. CIT (A)-II KANPUR DATED 14.05.2010 NEEDS TO BE QUASHED AND THE ORDER PASSED BY THE ASSESSING OFFIC ER DATED 26.12.2008 BE :-3-: RESTORED. 4. THE ASSESSEE IS AN EDUCATIONAL INSTITUTION IMPARTIN G EDUCATIONAL ACTIVITIES FROM THE ASSESSMENT YEAR 2005-06. THE ASSESSEE HAS BEEN GRA NTED REGISTRATION U/S. 12AA OF THE INCOME-TAX ACT 1961 (IN SHORT THE ACT) UNDER F.N O.141/846/12A/AA/REGISTRATION/ TECH.KANPUR/01-02 DATED 7.11.2003 W.E.F. 11.12.2000 . A SURVEY U/S. 133A OF THE ACT WAS CONDUCTED ON 13/14.11.2007 RESULTING INTO SEIZU RE OF SOME DOCUMENTS. FOR THE ASSESSMENT YEAR UNDER CONSIDERATION THE RETURN WAS FILED ON 30.10.2006 DECLARING NIL INCOME. HOWEVER THE ASSESSING OFFICER FRAMED THE ASSESSMENT U/S. 143(3) OF THE ACT ON 26.12.2008 DETERMINING THE TOTAL INCOME OF THE A SSESSEE AT $2 47 03 800. WHILE MAKING THE ASSESSMENT THE ASSESSING OFFICER MADE C ERTAIN ADDITIONS/DISALLOWANCES. 5. AGGRIEVED BY THE ORDER OF THE ASSESSING OFFICER TH E ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE LD. CIT(A). BEFORE THE LD. CI T(A) THE ASSESSEE RAISED AS MANY AS 10 GROUNDS. HOWEVER VIDE ORDER DATED 14.5.2010 T HE LD. CIT(A) ALLOWED THE APPEAL OF THE ASSESSEE PARTLY AND HENCE THE ASSESSEE IS IN AP PEAL AGAINST THE ADDITIONS/DISALLOWANCES SUSTAINED BY THE LD. CIT(A) AND THE REVENUE IS IN APPEAL AGAINST THE RELIEF GIVEN TO THE ASSESSEE. 6. AT THE VERY OUTSET SHRI G. N. SRIVASTAVA LD. COUN SEL FOR THE ASSESSEE POINTED OUT THAT THE ORDER OF THE LD. CIT(A)-II KANPUR DATED 1 4.5.2010 IS ILLEGAL AS PER THE ADMINISTRATIVE INSTRUCTION OF THE C.B.D.T. AS PER CIRCULAR NO.1589/CBDT DATED 10.12.1984 THE LD. CIT(A) SHOULD HAVE PASSED THE ORDER WITHIN 10 DAYS FROM THE DATE OF HEARING. ACCORDING TO SHRI G. N. SRIVASTAVA LD. C OUNSEL FOR THE ASSESSEE IN THIS CASE THE DATE OF HEARING WAS 13.8.2009 WHEN THE HEARING WAS CONCLUDED WHEREAS THE IMPUGNED ORDER HAS BEEN PASSED BY THE LD. CIT(A) ON 14.5.2010 AFTER A LAPSE OF ABOUT 9 MONTHS. THE CBDT CIRCULAR NO.1589/CBDT DATED 10.1 2.1984 READS AS UNDER:- 1589/CBDT. DATED: DECEMBER 10 1984 REFERENCE IS INVITED TO BOARDS INSTRUCTION NO.1489 DATED 3.11.82 THAT THE DEPARTMENTAL APPELLATE AUTHORITIES SHOULD PASS APPE LLATE ORDERS: (A) IN ALL CASES WITHIN 10 DAYS AFTER THE FINAL HEARING AND (B) IN ALL DULY HEARD CASES BEFORE RELINQUISHING CHARGE ON TRANSFER/PROCEEDING ON LEAVE. :-4-: IN THIS CONNECTION IT IS FURTHER STATED THAT AFTER AN ORDER OF TRANSFER IS PASSED NO CASE SHOULD BE TAKEN UP FOR HEARING AND IN PART HEA RD CASES THE HEARING SHOULD BE STOPPED. THE INSTRUCTION THAT IN ALL CASES THE APPELLATE ORDER SHOULD BE PASSED WITHIN 10 DAYS AFTER THE FINAL HEARING APPLIES EVEN WHERE THE AAC OR THE CIT(A) HAS BEEN TRANSFERRED. 7. IN OUR VIEW THERE IS A MERIT IN THE ABOVE SUBMISSI ONS OF SHRI G. N. SRIVASTAVA LD. COUNSEL FOR THE ASSESSEE. IT WAS ALSO SUBMITTED BY SHRI G. N. SRIVASTAVA LD. COUNSEL FOR THE ASSESSEE THAT THE LD. CIT(A) HAS NOT MENTIONED THE ARGUMENTS ADVANCED ON BEHALF OF THE ASSESSEE AT THE TIME OF HEARING. IN OUR VIEW THE LD. CIT(A) SHOULD HAVE PASSED THE ORDER WITHIN 10 DAYS AFTER FINAL HEARING OF THE APP EAL AS PER THE ABOVE REFERRED TO CIRCULAR. IT IS WELL SETTLED LAW THAT THE CIRCULAR ISSUED BY THE CBDT FROM TIME TO TIME TO THE INCOME-TAX AUTHORITIES ARE BINDING ON THEM. WE FIN D THAT THE IMPUGNED ORDER HAS BEEN PASSED BY THE LD. CIT(A) AFTER A LAPSE OF ABOUT 9 M ONTHS WHICH IS COMPLETELY IN VIOLATION OF THE INSTRUCTIONS ISSUED BY THE CBDT. CONSIDERIN G THE ENTIRE FACTS AND CIRCUMSTANCES OF THE PRESENT CASE WE THINK IT PROPER TO SET ASID E THE ORDER OF THE LD. CIT(A) IN TOTO AND REMAND THE MATTER TO THE LD. CIT(A) WITH THE DIRECT ION TO DECIDE THE APPEAL OF THE ASSESSEE AFRESH IN ACCORDANCE WITH LAW AFTER AFFORD ING DUE AND REASONABLE OPPORTUNITY OF HEARING TO THE ASSESSEE. THE LD. CIT(A) IS ALSO DIRECTED TO DECIDE THE APPEAL PREFERABLY WITHIN TWO MONTHS FROM THE DATE OF RECEI PT OF THE ORDER. 8. SINCE WE HAVE SET ASIDE THE ORDER OF THE LD. CIT(A) WHILE ALLOWING GROUND NO.1 OF THE ASSESSEES APPEAL AND THEREFORE WE DO NOT THINK IT NECESSARY TO DECIDE OTHER GROUNDS OF APPEAL OF THE ASSESSEE AND ALSO THAT OF THE REVENUE. 9. FOR STATISTICAL PURPOSES BOTH THE APPEALS OF THE A SSESSEE AS WELL AS THE REVENUE ARE ALLOWED. ORDER WAS PRONOUNCED IN THE OPEN COURT ON 8.3.2011 . SD/- SD/- [ N. K. SAINI] [H. L. KARWA] ACCOUNTANT MEMBER VICE PRESIDENT DATED:8.3.2011 JJ:0703 :-5-: COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT(A) 4. CIT 5. DR ASSISTANT REGISTRAR