TaxTMI 
TaxTMI 
2013 (8) TMI 324
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....st Deed dated 30.08.2004 placed at pages 14 to 21 of paper book. Shri Rakesh Chabra, s/o Shri Yash Pal Chabra, Shri Ram Gandhi, s/o of late Shri Jagan Nath Gandhi and Shri Prashant Bhalla, s/o Mr. Ravindra Nath Bhalla were the initial trustee of the assessee Trust. Shri Yash Pal Chabra also became trustee of the Trust. The Assessing Officer made an addition of Rs.72,04,404/- to the assessee Trust income of the assessee. It was corpus donation from Yash Pal Chabra, settler and trustee of the assessee. Shri Yash Pal Chabra was the donor of this corpus donation. Assessing Officer asked to produce the donor Shri Chabra but Shri Yash Pal Chabra was out of India and he could not be produced before the Assessing Officer. Assessing Officer also asked for the filing of the documentary support in support of the credit entries of this donation in the books of account of assessee. The Assessing Officer held that assessee has not given satisfactory explanation regarding this corpus donation of Rs.72,04,404/- shown as received from Shri Yash Pal Chabra and made the addition. Before the CIT (A), the assessee produced the additional evidences in support of this corpus donation. The CIT (A) did not....
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....f an assessee maintained for any previous year, and the assessee offers no explanation about the nature and source thereof or the explanation offered by him is not, in the opinion of the [Assessing] Officer. satisfactory, the sum so credited may be charged to income-tax as the income of the assessee of that previous year." Ld. AR pleaded that a general reading of these three provisions of Income-tax Act, 1961 clearly shows that provisions of section 68 of the Act are not applicable in the case of voluntary donations received by any trust for its corpus fund as donations received is already an income as per the provisions of section 2(24)(iia) of the Act and such donations are exempted u/s 11(1)(d) of the Act. The assessee has already included this amount for taxation purpose but such donations are exempted in view of the provisions of section 11(1)(d) of the Act. Ld. AR further submitted that the name and address of the donor, Shri Yash Pal Chabra along with his passport were filed before the Assessing Officer. The date of receipts, cheque number along with the bank statement, ITR and Permanent Account Number of the donor and confirmation from the donor were also filed. These dona....
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....able activities as held by CIT (A). This fact has been admitted by the Assessing Officer himself in the Assessment Year 2005-06. CIT (A) granted the relief to the assessee for the year under consideration for claim of exemption u/s 11 of the Act. During the year, the voluntary contribution of corpus donation of Rs.72,04,404/- was received from Shri Chabra which was clear from the computation of income submitted to the income-tax department. Shri Yash Pal Chabra was one of the trustee of the assessee trust. This fact is evident from the records. During the relevant period, the assessee enjoying the status of a Trust registered u/s 12A read with section 12AA of the Income-tax Act, 1961. During this period, the assessee was also enjoying the benefit of exemption under section 80G(5)(vi) of the Act. The assessee produced the following details before the Assessing Officer with regard to the corpus donations received by it :- (i) Name and address of person along with his passport (ii) Date of receipt (iii) Cheque number (iv) PAN No. of donor and acknowledgement of ITR (v) Confirmation from donor The Assessing Officer insisted for the presence of the donor which could not be done fo....
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....ed is against the CIT (A) allowing the benefit of exemption u/s 11 & 12 of the Income-tax Act, 1961 to the assessee. The CIT (A) has held that assessee is involved in charitable activities as found by Assessing Officer in Assessment Year 2005-06 and 2007-08. Ld. DR relied on the order of the Assessing Officer and submitted that the order of the CIT (A) on this issue may be set aside. 8. On the other hand, the ld. AR submitted that the Assessing Officer after detailed inquiry has himself found and reported that the assessee Trust is involved in charitable activities during the Assessment Year 2005-06 and 2007-08. There is no change in facts during the year. Since the assessee was involved in the charitable activities during the relevant year, therefore, the CIT (A) has rightly allowed the benefit of exemption u/s 11 & 12 of the Act. Ld. AR pleaded to sustain the order of the CIT (A). 9. We have heard both the sides on the issue. We have also perused the relevant documents filed in the paper book. The CIT (A) had granted the relief by holding as under :- "4. Ground No.3 & 4 are against the action of AO wherein, he denied benefit of exemption u/s.11&12 holding that activities of th....
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.... accompanied with audit report in Form No.10B. It also accompanied with balance sheet, income and expenditure account and relevant annexures. With regard to the addition of Rs.3 crores on account of transfer of flat, ld. AR submitted that Shri Yash Pal Chabra, one of the trustees of the assessee trust purchased a property at First Floor, Centrino Plaza, Plot No.8, Pocket 4, Section XI, MLU, Dwarka, New Delhi-10075 from M/s. SSPB Construction Pvt. Ltd. vide Agreement dated 14.06.2006. Shri Yash Pal Chabra gave this property on rent to Fab India Overseas Pvt. Ltd. vide lease agreement dated 01.09.2006. The property was transferred by Shri Yash Pal Chabra to the assessee Trust on 05.05.2007. Shri Yash Pal Chabra also transferred the security deposit received from tenant M/s. Fab India Overseas Ltd. of Rs.15,60,000/- to the assessee on 10.05.2007. With regard to the transfer of the property in the name of the assessee, the information was provided to M/s. Fab India Overseas Pvt. Ltd. on 08.05.2007 with the request to give the rent to the assessee trust w.e.f. 01.06.2007. However, assessee could not make full and final payments as agreed upon to Shri Yash Pal Chabra, therefore, property....
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....by Shri Yash Pal Chabra as his income in his books of account and declared to income-tax department. Shri Yash Pal Chabra has also paid the due taxes on this rental income. These facts show that assessee was never had any rental income for which it can be made liable for taxation. Similarly, the interest income added to the assessee was also unjustified when assessee was enjoying registration u/s 12A of the Act. Ld. AR pleaded to set aside the order of the CIT (A) on this issue. 12. We have heard both the sides on these issues. CIT (A) had sustained these additions by holding as under :- "5.1 As the issues pertains to transfer of property by Mr. Yash Pal Chabra or a consideration of Rs.3 crores. while deciding the issue for A.Y. 2006-07 vide order dated 29.03.2012, it was found that Mr.Yash Pal Chabra is being found to be giving corpus donation of Rs.72,04,404/- which has been added u/s.68. After detailed discussion, addition has been sustained in A.Y.2006-07. Following the same analogy, it is found that appellant was not able to controvert the findings of the AO given in the assessment order. So in my considered opinion, additions made by AO remains conclusive. Therefore, additi....