TaxTMI 
TaxTMI 
2017 (11) TMI 1587
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....of the case and in law the Ld.CIT(A) was right in holding that the additions made under section 68 of the Income-tax Act, 1961 would be entitled to exemption under section 10(23c) without appreciating the fact that unexplained deemed income cannot form part of exempt income? 3. Briefly stated relevant facts are that the assessee filed the return of income declaring total income nil. Assessee is a Trust and engaged in educational activities. In respect of its income, assessee claimed exemption u/s.10(23C) r.w.s 12A of the Act. At the end of the assessment proceedings Assessing Officer made various additions and determined the assessed income at Rs. 1,09,79,320. During the first appellate proceedings, after considering the assessee's submissions, the CIT(A) held that the additions made by the AO u/s.68 in both the years are sustainable. The contents of para 11 are relevant in this regard. However, on finding that the assessee is entitled to the deduction/exemption u/s.10(23C)(v) of the Act and also on finding AO denied such a deduction to the assessee in both the years, the CIT(A) granted such benefit of deduction/exemption u/s.10(23C)(v) of the Act in respect of such additions u/....
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....f the case and rival contentions. On perusal of the same it has been noticed that the appellant trust is registered u/s.12A, u/s.80G and is also notified by Hon'ble Chief Commissioner of Income-tax, Nashik u/s 10(23C)(v) of the Act vide order dated 3/12/2007. The said notification granting exemption u/s 10(23C)(v) of the Act is in force till date and has not been cancelled by Hon'ble Chief Commissioner of Income-tax, Nashik. A perusal of the assessment order dated 20/02/2015 for A.Y. 2012-13 reveals that the AO has not initiated any action for revocation or cancellation of exemption granted to the appellant u/s 10(23C)(v) of the Act in the light of huge additions u/s 68 of the Act. In fact, he has certified that the trust has complied with the relevant provisions of sec. 10(23C)(v) of the Act. The provisions of section 10(23C)(v) of the Act are to be followed for deciding the issue under appeal and hence the same are reproduced below: "10. In computing the total income of a previous year of any person, any income falling within any of the follows clauses shall not be included. (23C)-Any income received by any person on behalf of - (v) -any trust (....
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....2005) 4 RC 641; (2005) 4 SCC 272; 5 RC 379; (2005) 7 SCC 396 and CCE vs. Hira Cement (2006) 6 RC 219; (2006) 2 JT 369 (SC)]. It is also trite law that an exemption is to be granted unless it is expressly taken away. [See Adityapur Industrial Area Development Authority vs. Union of India (2006) 5 Scale 321]" 8. In view of the above, we do not find any infirmity in the decision of the Tribunal. No substantial question of law arises for consideration". iii) ACIT Vs. Muslim Education Society (2010) 1 ITR 527 (Cochin-Trib) In this case the assessee's income was subject to exemption u/s.10(23C)(v) being educational institution. The A.O. has made additions u/s.68 on account of unexplained cash credits. The Hon'ble ITAT has followed the decision of Hon'ble Delhi High Court in the case of DIT Vs. Raunaq Education Foundation (207) 294 ITR 76 and has held that what is entitled for exemption u/s.10(23C) is "any income"; the word 'income cannot be given restrictive meaning but its natural meaning, therefore the assessee is entitled to benefit u/s. 10(23C) even in respect of income covered u/s.68 of the Act. 12.5 I find from the records that n....
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....t case. Therefore, we are of the opinion the order of CIT(A) is fair and reasonable and it does not call for any interference. In the result, the solitary ground raised by the Revenue in the appeals are dismissed. 9. In the result, Revenue appeal is dismissed. C.O.No.34/PUN/2017 for A.Y 2010-11 by the Assessee. 10. This Cross Objection is filed by the assessee before the Tribunal in connection with the appeal in ITA No.843/PUN/2015. The said Cross Objection is filed with the delay of 25 days. Assessee filed the affidavit explaining the reasons for delay and narrated the sufficient cause. For the sake of completeness, the para 4 being relevant is extracted as under: "4. That the appeal memos of the Tribunal admittedly were received on 23-04-2017 and during that period our school was closed for summer vacation. The staff working in the office were also given leave because of summer vacation. During the summer vacation institute carries on the necessary repairs and maintenance of school building, mess building, administrative office etc and mostly these are looked after by the peons and security staff. The Staff working in the administration and accounts departments ....
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....2011-12. This exercise resulted in the following remarks i.e. some donors confirmed, no response from some others, some people wanted further time etc., Further, Shri Raghunath Jadhav flatly denied having given any donation to the Trust. Considering the discrepancies and anomalies, the CIT(A) issued a notice of enhancement of assessment as required u/s.251 of the Act and on adhoc basis, the CIT(A) proposed to make disallowance of 10% of the donations received in both the A.Y's. He proposed to treat the same as "Anonymous Donations" as defined in section 115 BBC of the Act. Further, CIT(A) interpreted the said provisions and obtained the reply from the assessee vide assessee's letter dated 28.04.2015. He proceeded to disallow 10% of the such donations and applied the provisions of section 115 BBC of the Act. The contents of para 14 at page No.37 to 42 of the order of the CIT(A) are relevant. CIT(A) is of the view that, the unverifiable of the donors antecedents constitutes "Anonymous Donations". Thus, the donations reflected in the books of accounts made by such unverifiable donors constitutes the "Anonymous Donations" as defined in sub-section (3) of 115 BBC of the Act. The exhaust....
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.... perused the order of the Revenue and the paper book filed before us. We have also perused the decisions cited by the both parties. To start with we extract the provisions of section 115 BBC and the definition given to Anonymous Donation in sub-section (3). The same read as under : "(3) For the purposes of this section, "anonymous donation" means any voluntary contribution referred to in sub-clause (iia) of clause (24) of section 2, where a person receiving such contribution does not maintain a record of the identity indicating the name and address of the person making such contribution and such other particulars as may be prescribed.]" 19. We find the above section is brought into statute with Finance Act 2002 w.e.f 01.04.2003 and the same apply to the A.Y 2011-12 under consideration. According to the said provisions, the "Anonymous Donation" is defined in sub-section (3). According to the sub-section (1), 30% of the aggregate of the Anonymous Donation received in excess of the higher of the specified amounts, constitutes tax in certain cases. The meaning given to the Anonymous Donations is exhaustive. The maintenance of record regarding the identity of the donors assu....