TaxTMI 
TaxTMI 
2015 (8) TMI 765
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....e cross-appeals are directed against the order of the learned Commissioner of Income-tax (Appeals) (Central), Gurgaon, dated December 17, 2012, for the assessment year 2003-04. 4. In the appeal of the assessee, grounds Nos.1 and 2 are general, therefore, the same are dismissed. 5. Grounds Nos. 3 and 4 of the appeal of the assessee reads as under : "3. That the learned Commissioner of Income-tax (Central) has erred in confirming the addition of corpus fund collected from 39 per sons as income of the assessee as undisclosed income on account of cash credits under section 68 of the Income-tax Act, 1961, whereas the said amount is supported by proper receipt mentioning name, address and permanent account number of the donor and is a capital receipt on account of corpus fund received with specific instructions of a capital fund and has already been shown as an income. 4. That the learned Commissioner of Income-tax (Central) has erred in confirming the addition of corpus fund collected from two private limited companies amounting to Rs. 20 lakhs as income of the assessee on the basis of unconfirmed facts even ignoring and not accepting the additional evidence in t....
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....from the impugned order that the assessee has shown Rs. 1,63,54,967 as addition to the capital fund. The Assessing Officer has thereafter given a description of the documents seized. Pages 5-14 of annexure D-2 contained the details of the amount received by the assessee from various people as donation/ corpus fund for the financial years 2002-03 and 2003-04. Further at the end of the seized list on each page, the total of these amounts have been calculated along with a figure which is 2 per cent. of the total amount. Document at page 35 of annexure D-2 contains details of cheque/demand draft received on various dates as donation/corpus fund. Noting at the top of the page mentions delivered Rs. 25,00,000. At the bottom of the page, the total amount as per the calculations is Rs. 32,99,000. Document at page 41 of annexure D-2 contain details of cheque/demand draft received on various dates as donation/corpus fund. Noting at the right hand side of the page shows an amount of Rs. 65,980 written against "commission 80G". At the top of the list on page 45, the total of these amounts, i.e., Rs. 41,37,500 has been calculated along with a figure, i.e., Rs. 82,750 which is 2 per cent. of the....
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....notice. .......These documents clearly showed that 2 per cent. commission has been paid to arrange donations. It would be pertinent to mention that the assessee in its reply had virtually accepted the payment of 2 per cent. of commission. Further as admitted by the assessee itself all the entries on these pages are accounted for in the books of the assessee. Hence these figures of 2 per cent. and 80G are not isolated figures in the documents. At some places "80G" "commission Delhi" is written and also name of some chartered accountant is written. Further, seized documents pages 1 and 2 of annexure D-2 are photocopies of two cheques dated March 6, 2003, of Rs. 10 lakhs each in favour of Indo Global Education from M/s. Nishant Finvest Pvt. Ltd. and M/s. Shober Associates Pvt. Ltd. An independent enquiry was carried out through Deputy Commissioner of Income-tax, Circle-I, Fahdahad and the Inspector of Income-tax so deputed, reported that the said companies are not existing at the relevant address for the last 15-20 years. On confronting, the assessee stated that these donations were received through account payee cheques and the companies might have shifted their pre....
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....ceived corpus donations total amounting to Rs. 1,63,54,699 in the assessment year 2003-04 and 2,84,70,952 in the assessment year 2004-05 from the donors for the construction of building. 2. Anonymous donations were even allowed up to the year 2007 yet all the donations received from donors are supported by receipts issued to the donors along with their name address and permanent account number. Most of the donations are received through cheques and drafts. 3. Documents marked 5-14 of annexure D-2 seized, represented rough working mentioning name and addresses of persons along with amount donated by each person. 4. All the said donations are accounted for in the books of account. These rough working were submitted by the members of the managing committee entrusted with the collection of funds. A nominal amount of 2 per cent. of the total amount collected by them were claimed as collection charges. In the absence of any vouchers the said collection charges were never paid to anybody except for claimed by them against regular vouchers. 5. That additions were made though no specific defects in the books of account maintained by the society was pointe....
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....he balance-sheet the donations were to be with a specific direction as to form part of the corpus, which was not so in the instant case. On the other hand the assessee's argument was that during the year the society was involved in the process of construction of building/infrastructure for establishing a college and so there were no admissions. That, the donations were corpus donations for construction of the building and that no commission/collection charges, other than against regular vouchers, were paid to the concerned persons towards their efforts in collecting the donations. 5.6 As evident from the impugned order, the entire donation of Rs. 1,63,54,699 has been added as income of the assessee. It is not in dispute that the assessee is running an educational institute as per the aims and objects of the society. It is also not in dispute that the assessee is maintaining books of account and the same have not been rejected under section 145 by the Assessing Officer. The donations have been duly accounted in the regular books of account is also a fact. Thus in this backdrop, with no admissions underway during the year, it is discernible that the donations have been u....
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....fficer, adverse reference is not being drawn. However, in respect of the balance 23 cases, the contention of the assessee that the persons have either left the country or have died not be acceptable. An exercise had been carried out by the Assessing Officer, but considering the outcome as discussed above, I am of the considered view that the factor of probabilities cannot be applied to the entire donated funds. Hence, only the disallowance to the extent of amounts donated by the 39 persons, as highlighted above, is confirmed as receipts from unex plained sources to be taxed under section 68. The Assessing Officer is directed to work out the amount involved. So to this limited extent, the part-issue is set aside. 5.7.1 In the case of two companies, there are specific findings based on the enquiry report of the Inspector of Income-tax that the companies did not exist in the given address since last 10-15 years. Importantly on confronting, the assessee merely provided the down loads from the website of the Ministry of Corporate Affairs. These documents downloaded were examined by the Assessing Officer who came to a specific finding that in the case of M/s. Nishant (supra), th....
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....before the authorities below. He has referred to one of the notices under section 133(6) of the Act issued by the Assessing Officer to one of the donors (paper book page 25) and submitted that in the said notice the Assessing Officer has not mentioned any year of donation and any amount, so it was vague notice and possibly some persons would not have been able to respond to the notice of the Assessing Officer in better way. He has referred to paper book page 146 which is one of the replies filed by the donor Shri Harbir Singh, in which he has explained that the period is not clear. Therefore, he has explained that no donation has been given. Paper book page 147 is receipt in the case of Shri Harbir Singh having his permanent account number as well as signature on the receipt. Another reply of the donor Ms. Gurvinder Kaur is filed at paper book page 148 who has also explained that the period is not explained in the notice and as far as her knowledge she has not given any donation to the assessee. Receipt of donation paper book page 149 is having her permanent account number and signature on the receipt. Paper book page 150 is the reply of the donor Shri Tara Singh on the same line a....
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.... not filing the bank accounts of both companies before the Assessing Officer in which it was explained that due to sufficient cause, some bank accounts were not produced. It was submitted that due to change of the address of the companies, the bank accounts were not filed and relied upon the decision of the hon'ble Punjab and Haryana High Court in the case of CIT v. Mukta Metal Works [2011] 336 ITR 555 (P&H) and the decision of the hon'ble Supreme Court in the case of Tek Ram (dead through LRs.) v. CIT [2013] 357 ITR 133 (SC). Learned counsel for the assessee, therefore, submitted that since sufficient evidence and material were produced before the authorities below to prove the genuineness of the donations in the matter and donations are spent on construction of the educational building, therefore, the addition was wholly unjustified. 13. On the other hand, the learned Departmental representative for the Revenue relied upon the order of the Assessing Officer and referred to paper book pages 65 to 70 to show that for lesser amount receipts have been issued to the students and paper book pages 5 to 15 are the seized papers to show that 2 per cent. commission have been pai....
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....ould, therefore, lead to inference that prior to that even anonymous donation was not subjected to tax. It is not in dispute that during the course of search the receipts which were found bear names, addresses, permanent account numbers of donors and in case of cash receipts, it contained the signature of the donors acknowledging the payment, as made towards the corpus fund. The details contained in the receipts have not been controverted by the Assessing Officer. Copy of the notice under section 133(6) of the Act is filed in the paper book at page 25, in which the Assessing Officer has not mentioned any detail in respect of any particular assessment year or amount in question. It was thus a vague notice. Paper book page 146 is a letter of one of the donors Shri Harbir Singh to the Assessing Officer, in which the donor also claimed that the period of donation is not clear and, therefore, according to his knowledge he stated that no donations have been given. The donation receipt is filed at page 147 of the paper book, which, however, contained his permanent account number and his signature. Similar replies are filed in the paper book at pages 148 to 153 with receipts in respect of ....
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....rities below failed to note that in their cases also, similar donations receipts were produced on record and the amounts of donations are very small in their cases and in all the receipts their permanent account numbers have been mentioned and the sources are also mostly the cheques or drafts. The authorities below instead of rejecting the contention of the assessee in these cases should have verified the facts from the Income-tax records as their specific permanent account numbers have been given in the donation receipts. As noted above, when the substantial donations have been proved by the assessee and in the cases of small petty donations, the donors are assessed to tax, instead of rejecting the claim of the assessee the facts should have been verified from the record of the Income-tax Department. The hon'ble Supreme Court in the case CIT v. Orissa Corporation P. Ltd. [1986] 159 ITR 78 (SC) held as under (headnote) : "Held, that in this case the respondent had given the names and addresses of the alleged creditors. It was in the knowledge of the Revenue that the said creditors were Income-tax assessees. Their index numbers were in the file of the Revenue. The Reven....
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....s donations, it forms part of corpus and have been utilised for the purpose of construction of the building and was thus spent for achieving aims and objects of the assessee-society and as such should not have been subjected to addition in the case of the assessee. The assessee also claimed that the donors, who have given donations to the assessee have claimed deduction under section 80G of the Act in the returns of income. The said fact is also not verified by the Assessing Officer from the Income-tax records of those concerned donors. The definition of anonymous donations as provided in section 115BBC(3) of the Act means any voluntary contribution, where a person receiving such contribution does not maintain a record of identity indicating name and address of the person making such contribution and such other particulars as may be prescribed. However, in the case of the assessee such details have been maintained by the assessee, therefore, could not be even termed as anonymous donations. 17. Considering the above in the light of the overwhelming evidences available on record, the learned Commissioner of Income-tax (Appeals) should not have sustained the addition even in the re....
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....om producing copies of their bank statements at assessment stage. The learned Commissioner of Income-tax (Appeals), therefore, instead of rejecting the claim of the assessee of admission of bank statements as additional evidence should have admitted his additional evidence at the appellate stage. In the case of Tek Ram (dead through LRs.) [2013] 357 ITR 133 (SC), the hon'ble Supreme Court finding the documents of some relevance and should be looked into by the High Court restored the matter to the file of the High Court for fresh disposal. The hon'ble Punjab and Haryana High Court in the case of Mukta Metal Works [2011] 336 ITR 555 (P&H) held that when additional evidences are necessary in deciding the case, it is the duty of the Tribunal to consider the additional evidences. The bank statements of the donor companies are necessary for just decision in the matter. We, therefore, admit the copies of the bank statements as additional evidence for doing justice between the parties as relevant to the matter in controversy. The copies of the bank statements filed in the paper book at pages 23 and 24 would prove that the donation cheques have been cleared through banking channel ....
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....t only part of the donation is to be treated as unexplained. The Assessing Officer has examined the document at page 41 of annexure-D-2, wherein at the right hand side of the page the amount of Rs. 65,980 is written against the commission 80G. This amount is found stated to be exactly 2 per cent. of Rs. 32,99,000 mentioned in the other seized page 35. The learned Commissioner of Income-tax (Appeals) found that the assessee has denied the payment of any commission even at the assessment stage. The learned Commissioner of Income-tax (Appeals) found that the assessee has not denied the contents of the documents under reference. Therefore, the addition of Rs. 65,980 was confirmed under section 69C of the Act and partly allowed the appeal of the assessee. 22. Learned counsel for the assessee reiterated the submissions made before the authorities below and submitted that no payment as commission was paid by the assessee. No evidence of commission payment was found in search. Paper book page 5 is seized document where 65,980 commission 80G is written but no such commission was paid. 23. The learned Departmental representative for the Revenue, however, relied upon the orders of the a....
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.... the assessee society was exempt under section 10(23C)(vi) and section 12AA of the Act. The Revenue on ground No. 3 challenged the order of the learned Commissioner of Income-tax (Appeals) in allowing the appeal of the assessee against conclusion of the Assessing Officer of not treating the activity of the assessee-society as genuine being violation of sections 11(3) and 13(3) of the Act. 27. Briefly, the facts are that this issue relates to violation of sections 11, 12 and 13 of the Act. It is the case of the Assessing Officer that the activities of the trust are not genuine as corpus has been credited with capital arranged from entry operators thereby not being voluntary contributions. It was also held that the cash found of Rs. 1.60 crores and seized from Shri Sukhdev Singla, chairman of the assessee-society were capitation fees collected from the students which indicated that the society was being run on commercial lines in violation of its charitable purpose for which it was set up. It is evident that the Assessing Officer has come to the conclusion regarding the violation of the provisions of sections 11, 12, 13 and 10(23C) of the Act on the basis of the additions as conta....
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....n the appeal of the assessee in I. T. A. No. 213/Chd/ 2012. However, at this stage this ground becomes infructuous. 29. In the result, the appeal of the assessee on this ground stands disposed of. However, in the Departmental appeal the learned Commissioner of Income-tax (Appeals) has correctly held that there was no finding of any violation of aims and objects of the assessee-society. The assessee was at the stage of formation, i.e., construction of educational building and all corpus funds applied towards the construction of the college building and no specific findings of fact have been recorded against the assessee in this assessment year and whatever additions have been made by the Assessing Officer on account of donors' donation or commission payment, we have already deleted the addition and allowed the appeal of the assessee. Therefore, it is not the case of violation of any provisions of sections 11, 12 and 13 of the Act in this year. Therefore, the learned Commissioner of Income- tax (Appeals) was justified in allowing the appeal of the assessee on this issue. The Departmental appeal fails and is dismissed. 30. In the result, the ground of the appeal of the asses....
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....vt. Ltd. and M/s. Sober Associates Pvt. Ltd. concluded that the assessee-society has violated the provisions of sections 11, 12 and 13 of the Act. Consequently an addition of entire corpus funds which was received during the year under consideration to the tune of Rs. 2,84,70,952 along with 2 per cent. commission to the tune of Rs. 5,69,419 was made by the Assessing Officer. It was submitted before the learned Commissioner of Income-tax (Appeals) that the submissions are same as have been given along with details in preceding assessment year 2003-04. The learned Commissioner of Income-tax (Appeals) found that the issue is same as has been decided in the assessment year 2003-04 and following his order for the assessment year 2003-04 deleted the addition deciding the issue in favour of the assessee. His finding in paragraphs 7 and 8 of the appellate order are reproduced as under : "7. I have gone through the impugned assessment order as well as the submissions made by the assessee. I find that there are no fresh facts viz-a-viz in this assessment year 2004-05 under consideration and the basis of making the additions on account of corpus funds and commission by the Assessing ....
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....he time of assessment proceedings as the said amount has been received as sale of scrap material and has been duly accounted for in the books of account of the society. 4. That, the learned Commissioner of Income-tax (Central) has erred in confirming additions of Rs. 1,60,00,000 by concluding that the income of Rs. 1.60 crores surrendered by Sh. Singla is in fact earned as capitation fee collected from the students of Indo Global Education Foundation. 5. That, the learned Commissioner of Income-tax (Central) has erred in not treating the activities of the society as genuine indicating violation of sections 11(3) and 13(3) of the Income-tax Act, 1961 without substantiating any violation and without appreciating the fact that the society satisfies all the conditions for utilisation of 85 per cent. of its income for the objects of the society. 6. That the learned Commissioner of Income-tax (Central) has erred in confirming and taxing of income of Rs. 1,63,99,950 whereas the income of the assessee-society is exempt under section 10(23C)(vi) and section 12AA of the Income-tax Act, 1961." 37. The assessee has challenged the addition of Rs. 3,99,950 on accoun....
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....,40,00,000 under section 132(4) recorded on July 16, 2008 (Rs. 1.60 crores as undisclosed income earned from consultancy and liaisioning in respect of property dealings ; Rs. 20,00,000 to cover any discrepancies in the documents seized and another Rs. 60,00,000 on account of amounts recoverable from different parties for services rendered in property dealings/consul tancy, etc. The Assessing Officer however, concluded that the sum of Rs. 1.60 crores is to be considered as income of the society under section 69, since Sh. Sukhdev Singla had earlier stated under section 132(4) on July 15, 2010, that the source of income was from rentals and, accordingly, it was added to the income of the assessee-society. 5.1.3. Similarly, regarding the cash slips which were found from the brief case, the Assessing Officer concluded that since at the time of search, the assessee could not render any explanation, except stating that the same would be known to the accountant, he held that the sale of scrap explanation was an afterthought. Likewise, as far as, the affidavits from the students to the effect that no capitation fees were paid, were concerned it has been stated that all the affidav....
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....tement under section 132(4) of the Income-tax Act, 1961 during the search operations declared undisclosed income of Rs. 2.50 crores (Rs. 10 lakhs in the assessment year 2008-09 and Rs. 2.40 crores in the assessment year 2009-10) which included cash of Rs. 1.60 crores found from the lockers and residential premises of Sh. Sukhdev Singla. The Assessing Officer out of Rs. 2.50 crores declared by the assessee added Rs. 1.60 crores as income of the trust for the assessment year 2009-10 without any rhyme and reason on selective basis. x. How come that out of total income of Rs. 2.50 crores declared by the assessee under section 132(4). Rs. 1.60 crores represent amount collected by the Indo Global Education Foundation as capitation fee and balance amount of Rs. 90 lakhs represents income of Sh. Sukhdev Singla. xi. Out of Rs. 1.60 crores assessed by the Assessing Officer during the assessment year 2009-10 in the hands of India Global Education Foundation, cash of Rs. 6,00,000 was found from locker No. 538, Syndicate Bank, Sector 17-B, Chandigarh, which was last operated by the assessee on May 5, 2008 and Rs. 37,12,000 was found from locker No. 332, Punjab National Bank, S....
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.... To sum up it is the assessee's case that the details emanating from the annexure D-20 showing fee received and amount received on account of sale of scrap as under : Date Name of student Tuition fee (Rs.) Sale of scrap (Jarnail Singh and Co.) (Rs.) Total (Rs.) 10-07-2008 Digvijay 40,000 50,000 90,000 11-07-2008 Mandip Kaur 35,000 35,000 70,000 12-07-2008 Ashish Khurana 10,000 45,000 55,000 13-07-2008 Gunish Kumar 45,050 1,54,950 2,00,000 14-07-2008 Narinder Singh Rawat 35,000 1,15,000 1,50,000 Total 1,65,050 3,99,950 5,65,000 Further, it was argued that during the year under reference the total sanctioned seats by All India Counsel for Technical Education to the society was 460 seats. Out of 460 seats, 420 seats were for Engineering streams and 40 seats for B. Architecture 67 per cent. seats are filled through counselling and 33 per cent. seats are filled through management quota. All the seats are filled on the basis of common entrance test (CET) and tenth, plus two basis. Seats left unfilled by the Punjab Technical University (PTU) through counselli....
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....,34,800 Accepted by the Assessing Officer 2006-07 37,57,300 -do- 2007-08 4,20,000 -do- 2008-09 20,000 -do- 2009-10 - 3,99,950 Addition made Total 5,38,58,019 3,99,950 0.75 per cent. The assessee has also relied upon the copy of seized cash book wherein the detail of scrap sold entries have been recorded along with copies of the receipts of scrap before the Assessing Officer. It has also been argued that in some of the years, i.e., from the assessment years 2005-06 to 2008-09, certain corpus funds were received and no adverse view had been taken by the Assessing Officer and also most of the cash was found from the residential portion of Sh. Sukhdev Kumar Singla and from the lockers and whereas from annexe portion, the cash which was found has been duly accounted in the books of account of society and, thus, it was stated that the charge of capitation fee is totally misdirecting and also the cash at the residential premises have been offered under section 132(4) and above, no other activities have been carried on by the society except the educational activity and, thus, it....
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....ound. Firstly that the seats were all not filled up ; returns of the assessee for the assessment years 2005-06, 2006-07 and 2008-09 have been accepted without any disallowances ; and cash of Rs. 2.40 crores for the assessment year 2009-10 and Rs. 10 lakhs for the assessment year 2008-09 was surrendered at the time of search on which taxes have been paid as the same stood declared in the returns filed by Shri Sukhdev Singla, the chairman of the society. However it is also fact that Shri Sukhdev Singla could not explain the discrepancies between the cash as per the bundle and as per the receipt issued in the name of the student with the branch of study, especially when the slips tied to the bundles were found in his briefcase. This was evident from the extracts of two statements recorded under section 132(4) which has been reproduced in the impugned order. The affidavits of the students regarding non-payment of capitation fees filed was also rejected by the Assessing Officer as not to relied upon as being students, they could not be expected to go against the institution. Even assuming that the cash represented proceeds from sale of scraps, there was no reason why there was no indica....
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....these fee receipts in the form of handwritten slips and put in bundles. These proceeds from sale of scraps are in lump sum figures and nothing very convincing arguments have been put forth that the proceeds are actually from scrap sales. As regards the explanation that the cash found emanated from the property dealings seems farfetched too. If that be so as made out by the assessee than there was nothing to hold back the assessee from producing documentary evidences of his real estate dealings be it in the line of consultancy or in sale and purchase. It is not in debate that assessee must have been with the construction company 'Ashiana' but what is germane to the issue is whether the cash found can be said to be from his property dealings per se. It is also not in debate that the assessee may have sold of his agricultural lands. In fact the diary stated to be belonging to Manav Singla put forth as corroborative evidence, is for purchase of property and not earnings on land transaction of sale and purchase. One could also argue that the material found was not sufficient to imply receipt of capitation fees. In this regard, I would think that the material in the form of such ....
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.... for the assessee reiterated the submissions made before the authorities below and referred to paper book page 1, which is inventory of cash found and seized from Shri Sukhdev Kumar Singla and submitted that no cash was found and seized from the assessee. Paper book page 61 is the statement of Shri Sukhdev Kumar Singla recorded on July 16, 2008, in which the Assessing Officer asked for the explanation of Shri Sukhdev Kumar Singla regarding cash found from his premises and lockers and Shri Sukhdev Kumar Singla explained that sum of Rs. 20,90,305 was received from the office of the assessee-society and the same belonged to the assessee- society as per the books of account maintained and the remaining amount of Rs. 1.60 crores recovered from his residence/locker belonged to him. He has declared the said sum under section 132(4) of the Act and surrendered for the purpose of taxation. However, the total surrender was made of Rs. 2.50 crores by making further surrender of Rs. 10 lakhs, Rs. 20 lakhs and Rs. 60 lakhs. Shri Sukhdev Kumar Singla made the aforesaid surrender of income of Rs. 2.40 crores in his return of income filed for the assessment year 2009-10 and the Assessing Officer ma....
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.... capitation fees or donation from the students. Paper book page 91 is the bank certificate in the case of Shri Sukhdev Kumar Singla to show that the locker No. 332 was lastly operated on November 28, 2007, and thereafter it was searched by the Income-tax Department on July 15, 2008 and as such whatever was found in this locker belonged to Shri Sukhdev Kumar Singla and did not pertained to the assessment year under appeal, i.e., 2009-10 and no addition has been made in the assessment year 2008-09 either against the assessee or against Shri Sukhdev Kumar Singla. Learned counsel for the assessee submitted that there were no basis to make addition of capitation fees charged from any students. Shri Sukhdev Kumar Singla has already disclosed and declared Rs. 2.40 crores in his return of income for the assessment year 2009-10. Therefore, the addition of Rs. 1.60 crores in the case of the assessee on substantive basis is without any basis and is not valid in law. He has submitted that no document was found during the course of search to prove that any capitation fee was received from any student and no cash was found from the possession of the assessee- society. Therefore, both additions a....
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....page 1 is inventory of the cash found and seized from Shri Sukhdev Kumar Singla from his residence and lockers. Out of the total cash of Rs. 1,80,90,305, Rs. 1.60 crores were seized and balance cash was released. The other cash of Rs. 20,90,305 was also released. The statement of Shri Sukhdev Kumar Singla was recorded on July 15, 2008, i.e., the date of search, copy of which is filed by the learned Departmental representative for the Revenue on record that on the last page it is signed by Shri Sukhdev Kumar Singla and the search party on July 16, 2008. The learned Departmental representative for the Revenue heavily relied upon the statement of Shri Sukhdev Kumar Singla to show that the receipts seized during the course of search pertained to some students in whose cases lesser amounts have been shown in the books of account. Shri Sukhdev Kumar Singla stated in his statement that the receipts are for fees of the students getting admission into the college and when the seized receipts were compared with the actual receipts entered into the books of account, Shri Sukhdev Kumar Singla explained that such discrepancies can be explained by his accountant only. It is admitted fact that th....
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....hat account. Some other documents were also filed to show that Shri Sukhdev Kumar Singla was dealing in the properties. The Assessing Officer instead of examining this issue in the light of the documents brought on record has merely disbelieved the statement of Shri Sukhdev Kumar Singla and made substantive addition in the case of the assessee society without any basis. Section 110 of the Indian Evidence Act provides "when the question is whether any person is owner of anything of which he is shown to be in possession, the burden of proving that he is not the owner is on the person who affirms that he is not the owner". In this case, it is admitted fact that the cash was found from the residential premises of Shri Sukhdev Kumar Singla as well as from his different lockers. Shri Sukhdev Kumar Singla also admitted in the statement recorded during the course of search operation that such cash belonged to him except the amount of Rs. 20,90,305 in respect of which there is no dispute between the parties. Therefore, ShriSukhdev Kumar Singla surrendered a sum of Rs. 2.40 crores in the assessment year 2009-10 for the purpose of taxation in his personal individual case. There is no other ev....
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.... addition have been made in the assessment year 2008-09. Therefore, the addition of Rs. 37,12,000 is cash found from this locker could not be added in the hands of the assessee- society in the assessment year under appeal, i.e., 2009-10. The Revenue Department also heavily relied upon the slips found in the cases of some of the students, copies of the same are filed at pages 65 to 69 of the paper book. However, in these slips it is nowhere mentioned if any capitation fees have been paid by the students to the assessee-society. These receipts contained only the figure as "D-90" and the same is repeated in other slips. The Assessing Officer, therefore, inferred that these students might have paid more fees to the assessee-society. However, the record of the assessee-society revealed that whatever fees have been paid by the students have been recorded in the books of account and all these students have filed their affidavits on record affirming that they have paid the amount which is shown in the receipts issued by the assessee-society and they were admitted purely on merits. They have affirmed that they have not paid any donation/capitation fee or any extra charges to the assessee- s....
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....make any enquiry from these students in respect of whom these receipts were pertained. The employees who have allegedly maintained these rough receipts have also not been examined by the Assessing Officer. The assessee disputed these slips because they were containing details of fees received from the students as well as the amount received by way of sale of scrap. It may also be noted here that in assessment years 2005-06, 2006-07, 2007-08 and 2008-09, the incomes declared by the assessee-society have been accepted and no adverse inference have been drawn against the assessee. The Assessing Officer has relied upon the slips found during the course of search without having any corroborative evidence. Rather the evidence produced by the assessee clearly supports the case of the assessee-society that no capitation fees have been received by the assessee-society from any students. Since the entire cash found have been owned by Shri Sukhdev Kumar Singla in his statement recorded under section 132(4) of the Act and he has also made surrender of the same amount in his individual return of income and also explained source of the same, there was no reason for the Assessing Officer to make ....
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....titutions run by the assessee-society in the impugned order and also noted that at the time of admission, in case some seats remain vacant after counselling process, the seats are converted into management quota seats. The fees structure of various colleges run by the assessee-society are also mentioned along with fees fixed by the Government. It is also noted that the search was conducted in the case of the assessee-society on July 15, 2008 and various incriminating documents were found as have been discussed and considered in the appeals of the assessee-society in the assessment years 2003-04, 2004-05 and 2009-10 above. It is also noted that the assessee- society has allegedly received capitation fees from the students which are noted from the seized slips, which according to the assessee contained details of fees as well as sale of scrap. It is also noted that one receipt was seized from Shri Sukhdev Kumar Singla dated July 26, 2002, for receipt of Rs. 10 lakhs by Capt. Bikramjit Singh in cash as payment for sale of land to the assessee-society, which is not reflected in the books of account of the assessee-society and some other documents were recovered to show gift deed of lan....
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...., satisfied that the activities of the assessee-trust/society are not genuine and have not been carried out in accordance with the objects of the trust. Therefore, registration granted under section 12AA of the Act vide order dated January 17, 2003, was cancelled. Further recognition under section 80G was also withdrawn accordingly. 49. The assessee is in appeal challenging the order of the learned Commissioner of Income-tax in cancelling/withdrawing the registration under sections 12AA and 80G of the Act in this order. 50. Both parties stated that the registration was cancelled under section 12AA of the Act and approval under section 80G of the Act was withdrawn because all the additions were made in the assessment years 2003-04, 2004-05 and 2009-10 by the Assessing Officer. Therefore, the findings on this would depend upon the findings given in the assessment years 2003-04, 2004-05 and 2009-10 and the issue is accordingly consequential in nature. 51. We have considered the rival submissions and perused the material available on record. It appears that the learned Commissioner of Income- tax cancelled the registration under section 12AA of the Act along with the approval ....
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....t the assessee-society at this stage to show that the assessee's activities are not genuine or have not been carried out in accordance with the objects of the trust. We may also note here that in the remaining assessment years 2005-06, 2006-07, 2007-08 and 2008-09, the Revenue Department did not find any adverse material against the assessee to prove that its activities are not genuine. There is no violation of sections 11, 12 and 13 of the Act. There is also no violation of conditions under section 80G of the Act. Therefore, considering the totality of the facts and circumstances, it is clear that the assessee-society has solely carried out the genuine educational activities and as such, there is no reason to cancel the registration under section 12AA of the Act or withdrawing the approval under section 80G of the Act. 52. We may also note here that the learned Commissioner of Income-tax has passed the impugned order on December 19, 2011, without waiting for the appeals to be decided by the learned Commissioner of Income-tax for the assessment years 2003-04, 2004-05 and 2009-10. The learned Commissioner of Income-tax (Appeals) had decided the appeals of the assessee in the ....
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....res on substantive basis in the hands of the assessee-society and made protective assessment of the same amount in the hands of Shri Sukhdev Kumar Singla on the basis of the same reasons as have been given in the case of the assessee-society. The assessee made similar submissions before the learned Commissioner of Income-tax and it was explained that the assessee had declared Rs. 2.40 crores in his return of income. Therefore, such addition should not be made on substantive basis in the case the assessee-society. The learned Commissioner of Income-tax, however, did not agree with the submissions of the assessee and noted that since the substantive addition is confirmed by him in the hands of the assessee- society M/s. Indo Global Education Foundation, the protective addition in the hands of the assessee of Rs. 1.46 crores was deleted. 59. On consideration of the rival submissions, we are of the view that the issue is same as have been considered in the case the assessee society in the assessment year 2009-10 in I. T. A. No. 227/Chd/2013. Both parties stated that the issues being same may be decided accordingly as have been decided in the case of the assessee-society. 60. Whil....