The ACIT, 1(1), v. M/s Kinder Garten Management Society,

ITA 774/IND/2007 | 2004-2005
Pronouncement Date: 30-04-2010 | Result: Dismissed

Appeal Details

RSA Number 77422714 RSA 2007
Bench Indore
Appeal Number ITA 774/IND/2007
Duration Of Justice 2 year(s) 4 month(s) 10 day(s)
Appellant The ACIT, 1(1),
Respondent M/s Kinder Garten Management Society,
Appeal Type Income Tax Appeal
Pronouncement Date 30-04-2010
Appeal Filed By Department
Order Result Dismissed
Bench Allotted DB
Tribunal Order Date 30-04-2010
Date Of Final Hearing 28-04-2010
Next Hearing Date 28-04-2010
Assessment Year 2004-2005
Appeal Filed On 20-12-2007
Judgment Text
1 IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH INDORE BEFORE SHRI JOGINDER SINGH JUDICIAL MEMBER AND SHRI V.K. GUPTA ACCOUNTANT MEMBER ITA NO.774/IND/07 A.YS. 2004-05 ASSTT. COMMISSIONER OF INCOME TAX 1(1) BHOPAL APPELLANT VS KINDER GARTEN MANAGEMENT SOCIETY BHOPAL PAN AAAAK-0232-B RESPONDENT APPELLANT BY : SHRI RAJIV VASHNEY CIT DR RESPONDENT BY :SHRI S.S. DESHPANDE CA O R D E R PER JOGINDER SINGH JM THIS APPEAL IS BY THE REVENUE AGAINST THE ORDER OF THE LEARNED CIT(A) DATED 28.9.2007 ON THE FOLLOWING GROUNDS :- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) ERRED IN 1. DELETING THE ADDITION OF RS.63 47 892 MADE BY TH E A.O. ON ACCOUNT OF FAILURE OF THE ASSESSEE TO COMPLY MANDAT ORY 2 PROVISIONS OF SECTION 11(2) AND FILING OF FORM NO. 10 AND TAKING COGNIZANCE OF REVISED FORM NO. 10. 2. DELETING THE ADDITION OF RS.13 13 925/- MADE BY THE A.O. ON ACCOUNT OF UNUTILISATION OF ACCUMULATED SURPLUS WIT HIN 10 YEARS. DURING HEARING WE HAVE HEARD LEARNED REPRESENTATI VES FROM BOTH THE SIDES AND CONSIDERED THE ARGUMENTS ADVANCED BY THEM. THE FIRST GROUND PERTAINS TO PROVISIONS OF SECTION 11(2) AND FILING OF FORM NO. 10. THE CRUX OF ARGUMENTS ON BEHALF OF THE REVENUE IS I N SUPPORT TO THE ASSESSMENT ORDER WHEREAS THE LD. COUNSEL FOR THE AS SESSEE DEFENDED THE IMPUGNED ORDER. WE HAVE PERUSED THE RECORD AND CONSIDERED THE ARGU MENTS ADVANCED BY THE LEARNED RESPECTIVE COUNSELS. BRIEF FACTS ARE THAT THE ASSESSEE SOCIETY IS ENGAGED IN IMPARTING EDUCATION AND IS A CHARITABLE INSTITUTION AS DEFINED IN SECTION 2(15) OF THE ACT AS IT SOLELY EXISTS FOR EDUCATIONAL PURPOSES. BROADLY ITS OBJECTIVES ARE ALSO OF CHARITABLE NATURE. THE ASSESSEE SOCIETY DISCLOSED NIL INCOME IN ITS RETURN. AS PER THE REVENUE THE GROSS RECEIPT OF THE INSTITUTION W AS RS.1 62 26 353/- AND AFTER DEDUCTION OF 15% OF ITS INCOME U/S 11(2) IT R EMAINED AT RS.1 37 79 400/- WHEREAS RS. 69 44 508/- WAS INCURR ED AS EXPENDITURE DURING THE YEAR LEAVING THE UNUTILIZED BALANCE OF RS.68 47 892/-. THE ASSESSEE INSTITUTION DURING THE ASSESSMENT PROCEED INGS FILED REVISED RESOLUTION ALONG WITH FORM NO. 10 RESOLVING THAT SU RPLUS AMOUNT SHALL BE 3 SET APART AND BE UTILISED FOR THE OBJECTS ENUMERATE D IN THE RESOLUTION WITHIN THE STIPULATED PERIOD. THE ASSESSING OFFICER ADDED THE AMOUNT OF RS. 63 47 892/- TO THE TOTAL INCOME OF THE ASSESSEE ON THE GROUND THAT FOR THE IMPUGNED AMOUNT NO RESOLUTION HAS BEEN FIL ED. ADMITTEDLY THE ASSESSEE WAS GRANTED REGISTRATION U/S 12AA/12A AND FURNISHED THE RETURN OF INCOME ALONG WITH FORM NO. 10 WHICH WAS S UBSEQUENTLY REVISED AND AUDIT REPORT IN PRESCRIBED FORM NO. 10B WAS FILED. THIS FACT WAS IGNORED BY THE ASSESSING OFFICER. IT IS SEEN T HAT THE LD. FIRST APPELLATE AUTHORITY HAS ALREADY CONSIDERED VARIOUS JUDICIAL PRONOUNCEMENTS OF THE HONBLE HIGH COURTS/APEX COUR T LIKE BAR COUNCIL OF UTTAR PRADESH V. CIT; 143 ITR 584 (ALL); CIT V. BAR COUNSEL OF MAHARASHTRA; 130 ITR 28 (SC); CIT V. MUMTAZ YASUD D OWLA WAQF; 234 ITR 6 (AP); CIT V. A.M. FAKHARIA; 208 ITR 568 (RAJ) AND STO V. K.I. IBRAHIM; 20 STC 367 (SC) AND CIRCULAR NO. 273 DATED 3.6.1980 WHEREIN IT WAS HELD THAT THE TIME LIMIT IS ONLY DIRECTORY A ND NOT MANDATORY WITH RESPECT TO SECTION 11 READ WITH RULE 17. NON-COMPL IANCE WITHIN THE STIPULATED PERIOD SHOULD NOT DISENTITLE A TRUST FRO M EXEMPTION TO WHICH IT IS OTHERWISE ELIGIBLE. IN THE CASE OF K.I. IBRAHIM (SUPRA) THE APEX COURT HELD THAT THE RULE MAKING AUTHORITY HAS NO POWER TO PRESCRIBE THE TIME LIMIT WHEREAS SUCH POWER HAS NOT BEEN CONFERRED BY THE STATUTE. IN VIEW OF THESE FACTS AND ESPECIALLY IN THE ABSENCE O F ANY CONTRARY FACTS 4 BROUGHT TO OUR NOTICE BY THE REVENUE WE FIND NO IN FIRMITY IN THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS). IT IS UPHELD. 3. THE NEXT GROUND PERTAINS TO DELETING THE ADDITIO N ON ACCOUNT OF UN- UTILISATION OF ACCUMULATED SURPLUS WITHIN TEN YEARS . THE CRUX OF ARGUMENTS ON BEHALF OF THE REVENUE IS IDENTICAL TO THE GROUND RAISED WHEREAS THE LD. COUNSEL FOR THE ASSESSEE EXPLAINED THAT THE INCOME FOR THE ASSESSMENT YEAR 1994-95 WAS TOTALLY EXEMPT U/S 10(22) THEREFORE THE ASSESSEE WAS NOT SUPPOSED TO FILE RETURN THERE FORE THE UTILIZATION OF THAT INCOME DOES NOT ARISE AT ALL. IT IS ALSO MENT IONED THAT WITH EFFECT FROM 1.4.1999 REGISTRATION WAS GRANTED TO THE ASSES SEE U/S 12A AND PRIOR TO THAT THE INCOME WAS TOTALLY EXEMPT AS MENT IONED ABOVE. THE UNCONTROVERTED FACT IS THAT THE SURPLUS INCOME OF R S.15 99 650/- (A.Y. 1994-95) WAS TOTALLY EXEMPT AS MENTIONED ABOVE THE REFORE A FUTILE EXERCISE HAS BEEN MADE BY THE ASSESSING OFFICER. T HERE IS AN UNCONTROVERTED FACT THAT THE PERIOD OF TEN YEARS WI LL BE RECKONED FROM FIRST DAY OF THE NEXT YEAR TILL THE LAST DAY OF THE NEXT YEAR (10 TH YEAR). IN VIEW OF THESE FACTS THERE IS NO INFIRMITY IN THE S TAND OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS). OUR VIEW FIN DS SUPPORT FROM THE DECISION OF THE TRIBUNAL DATED 22.5.2009 IN THE CASE OF ITO V. SHRI MAHAKAL MANDIR PRABANDH SAMITI UJJAIN (ITA NO. 235 TO 237/IND/2008) THEREFORE WE CONFIRM THE STAND OF THE LEARNED COMM ISSIONER OF INCOME TAX (APPEALS). 5 FINALLY THE APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN OPEN COURT ON 30TH APRIL 2010. SD SD (V.K. GUPTA) (JOGINDER SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER APRIL 30 2010 COPY TO: APPELLANT RESPONDENT CIT CIT(A) DR G UARD FILE *DBN/