2014 (8) TMI 115

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....referred the present appeal with the following proposed question of law; "2. ... (A) Whether in the circumstances and the facts of the case and in law, the ITAT is justified in cancelling the penalty imposed by the AO and confirmed by the CIT(A) under the provisions of Section 27(1)(c)?" 2. The assessee-Trust filed its return for the A.Y. 2007-08 on 31.10.2007, declaring total deficit of Rs. 2,46,59,903. The assessment was completed under Section 143(2) of the Act on 29.12.2009, determining the total income of Rs. 55,29,360. It appears that during the course of scrutiny proceedings, it was observed that the assessee-Trust had received voluntary donation amounting to Rs. 1,08,80,765 from different persons. The assessee, however, had claim....

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....n appeal before the learned CIT(A) and learned CIT(A) confirmed the order of penalty passed by AO. Feeling aggrieved and dissatisfied with the order passed by the learned CIT(A), the assessee preferred the appeal before the learned ITAT and by impugned order the learned Tribunal, by observing as under in Para-6 of its order, has allowed the appeal preferred by the assessee and has cancelled the penalty imposed by the AO under Section 271(1)(c) of the Act; "6. Having heard both the sides, we have carefully gone through the orders of the authorities below. The Hon'ble Karnataka High Court in the case of DIT & Anr. Vs. Sri Ramkrishna Seva Ashram, 258 CTR 201 (Kar.) and ITAT Jaipur Bench in the case of ITO V. ooranmal Charitable Trust, 12 TTJ ....

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.... of the learned Tribunal, the appellant-Revenue has preferred the present Tax Appeal with the aforesaid substantial question of law. 5. We have heard Shri. Pranav G. Desai, learned Advocate appearing on behalf of the Revenue, and considered the facts and circumstances of the case; i.e. the order passed by the Assessing officer; the order passed by the learned CIT(A) as well as the impugned order passed by the learned Tribunal. At the outset, it is required to be noted that the assessee treated the donation of Rs. 1,08,80,765, received from different donors, as corpus donation and claimed benefit of exemption under Section 11(1)(d) of the Act. However, Assessing Officer did not accept the contention on behalf of the assessee that the afores....