2010 (5) TMI 844

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....(3) read with section 147 of the Act. Two grounds have been taken in the appeal that on the facts and in the circumstances of the case, the learned CIT(A) erred in deleting the addition of ₹ 1,50,226/- representing non-genuine donation by following the decision of Hon'ble Delhi High Court in the case of Director of Income-tax (Exemption) Vs. Keshav Social Charitable Foundation (2005) 278 ITR 152. In this connection it is mentioned in the grounds that the sum of ₹ 1,50,226/- was merely an accommodation entry obtained by paying equivalent amount in cash to the entry provider. It is further mentioned that the exemption was granted u/s 11 by not considering the adverse inference brought on record by the Assessing Officer, leading to....

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....ime. Aggrieved by this order, the revenue is in appeal before us. The limited case of the learned DR before us is that the decision of Hon'ble Delhi High Court in the case of Keshav Social Charitable Foundation (supra) has not been accepted by the department and its SLP is pending before the Hon'ble Supreme Court in the matter. In reply, the case of the learned counsel for the assessee is that the decision has been rendered by the jurisdictional High Court, which is binding on the Tribunal as well as on the lower authorities. The operation of this judgment has not been stayed in any manner by any court and thus mere pendency of the SLP cannot bar the application of the ratio of the case. Coming to the facts our attention was drawn to pages....

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....hat the books etc. were not produced before him, the only adverse conclusion which can be drawn is that application of income of ₹ 6,245/- is not proved and, therefore, it cannot be deducted from the total income u/s 11(1). Having come to this conclusion we may still refer to the decision in the case of Keshav Social Charitable Foundation (supra), in which the Hon'ble Court disproved the approach of the Assessing Officer and held that the provisions of section 68 have no application to the facts of the case when donations were shown as income. For the sake of ready reference the relevant portion of the judgment is reproduced below:- "We are afraid that it is not possible for us to agree with the submission of learned counsel for the ....