TaxTMI 
TaxTMI 
2021 (11) TMI 33
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....ed in Pune. It is a Government recognized School. Apart from the primary activity of providing Education, the Trust also provides Medical Aid and Relief to the Poor. The return of income for the Asst Year 2015-16 was filed on 28.9.2015 declaring total income of Rs Nil. The return of income was accompanied with Income & Expenditure Account, Balance Sheet and Audit Report in Form 10B. The case was selected for scrutiny and in response to hearing notices, the assessee trust filed all the requisite details from time to time. The ld AO even acknowledges this fact in Para 3 of his assessment order that the requisite details called for were duly furnished by the assessee from time to time. The ld AO specifically makes a mention in para 4 of his assessment order that the expenditure incurred for the objects of the trust as detailed in income and expenditure account has been examined by him before framing the assessment and ultimately the assessment was completed u/s 143(3) of the Act on 12.6.2017 by categorically stating that the application of income for the objects of the trust of Rs. 13,90,77,143/- was more than the gross receipts of the trust at Rs. 13,84,79,292/-. 3.1. This assessm....
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....n undisputed and hence the same are not reiterated herein for the sake of brevity. The main argument of the ld. AR is that relevant and sufficient enquiries were indeed carried out by the ld. AO in the original assessment proceedings on the impugned issues involved in the show-cause notice u/s.263 of the Act. To buttress this argument, he drew our attention to the questionnaire issued by the ld. AO in the original assessment proceedings and the replies filed before the ld. AO by the assessee vide letters dated 09/03/2017, 05/05/2017, 23/05/2017, 30/05/2017 & 05/06/2017 together with the relevant annexures. We find that the return of the assessee filed for the A.Y.15-16 was selected for 'limited scrutiny' to examine the following issues:- i) Accumulation of income by trust ii) Receipts of Trust iii) Deposits in Co-operative bank iv) Mismatch in income / capital gain on sale of land or building v) Tax credit mismatch vi) Charity expenses. 3.4. We find that assessee during the course of original assessment proceedings vide its letter dated 09/03/2017 had explained all the aforesaid six issues. The assessee had also vide letter d....
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....13,09,665 Gratuity 12,53,327 Pension - Karkaria Minoo M. 2,29,200 P.F. Inspection Charges A/c. No. 70,476 4,98,53,026 Other Expenses Computer Expenses 5,96,103 Education Expenses 2,12,022 Examination Expenses 1,09,980 Function & Festival Expenses 9,87,016 Housekeeping Expenses 1,94,754 Expenses 80,564 Laboratory Expenses 1,643 Library Expenses 3,100 Online Admission form Fees 10,720 Pta Expenses 7,022 Sports & Games 14,69,668 Workshop Expenses 1,56,561 Advertisement Expenses 83,817 Bank Charges / Money order Charges 7,846 Conveyance Expenses 2,06,792 Electricity Charges 16,17,545 General Expenses 1,40,881 Infirmary Expenses 2,08,321 Late payment Charges of PT 24,000 Legal & Professional Fees 1,685 Magazine & Periodicals 3,30,981 Medical Expenses 7,376 Mediclaim....
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.... numbers of the paper book filed before us as under:- Sr. No Date of transfer from Bank of India (Mumbai Main Branch) M. G. Road, Fort - Account No.00l 10100006 149 Amount transferred Rs. Page Number of Paper Book Date of Receipt by transferee Bank Name of the transferee Bank Account Number Amount Receipt Page number of paper Book 1. 19th May, 2014 10,00,000 241 20th May,2014 State Bank of India 11045079320 10,00,000 229 2. 22nd May, 2014 20,00,000 241 3rd June, 2014 State Bank of India 11045085801 20,00,000 229 3. 23rd June, 2014 15,00,000 242 24th June,2014 State Bank India 11045085801 15,00,000 229 4. 21st July, 2014 15,00,000 242 24th July, 2014 State Bank 11045085801 15,00,000 229 5. 22nd August, 2014 12,00,000 248 27th August, 2014 State Bank of India 11045085801 12,00,000 229 6. 18th September 2014 15,00,000 248 24th September, 2014 State Bank of India 11045085801 15,00,000 229 7. 9th October, 2014 10,00,000 248 13th October, 2014 Bank of India 000110100006129 10,00....
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.... sale of land, the advance receipt of Rs. 71 Crores has been shown as liability in balance sheet as on 31/03/2015. It was also pointed out that the purchasers of the said property had deducted tax at source u/s.194IA while making payment of advance. Accordingly, the said amount is reflected in Form 26AS of the assessee. By this process, the assessee had explained the mismatch between the entry in Form 26AS and the income of the assessee. Later, vide letter dated 23/05/2017, the assessee enclosed a detailed note exclusively on receipt of advance of Rs. 71 Crores pursuant to a specific query raised by the ld. AO during the course of personal hearing. For the sake of convenience, the note filed by the assessee before the ld. AO with regard to the non-chargeability of capital gains on sale of two plots of land are reproduced hereunder:- 1) The assessee Trust is the owner of a plot of land which forms part of the larger property described in the Indenture of Lease dated 14th April, 1950 duly confirmed by the Hon'ble Bombay High Court in its order dated 12th March, 1951 in Suit No. 202 of 1951. In other words the said Property was given on lease in 1951. The said Lessees in turn....
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....y when the first transaction took place by signing the consent terms that in 2014 the assessee Trust opted to receive the monetary consideration of Rs. 6 crores, however, before the conveyance could be executed, the validity of the Order of the Charity Commissioner lapsed. In view of this, the Trust has applied to the Charity Commissioner for extension of time, which application is pending. It is for this reason that the amount of Rs. 6 crores received by the Trust has also been shown as advance. 3.10. From the aforesaid note it was very clearly explained by the assessee before the ld. AO that since the approval of the Charity Commissioner was obtained by the assessee trust only on 22/06/2016, the conveyance deed has been executed by the assessee thereafter and accordingly, there was no taxable capital gain that arises in A.Y.2015-16. Based on this explanation, the ld. AO on due examination of the documents, took a plausible view and the correct view that capital gains does not arise in A.Y.2015-16 to the assessee. Hence, we hold that the order of the ld. AO in this regard cannot be termed as erroneous so as to invoke revision jurisdiction u/s.263 of the Act. These facts were fu....
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....Subsequently, the Assessee Trust noticed various breaches of the Indenture of Lease dated 14th April 1950, the said breaches being in the form of illegal assignments, breach of covenants, etc. committed by the 7 Lessees, the sub-lessees and their respective successors in title/assignees. This resulted in the Assessee Trust filing a suit for eviction in the Small Causes Court at Bombay against 41 defendants. Note submitted to A.O. Pages 227 and 228 6. Due to the intervention of various parties and professionals, consent terms were executed between the Trust and some of the Defendants viz. Defendant Nos. 20, 24, 33 , 37, 38 and 40 ('the said 6 Defendants') on 23rd December 2014. However, the said Suit continued to remain pending qua the other Defendants. Under the said Consent Terms: i. the said 6 Defendants agreed to purchase the reversionary rights of the Plaintiff i.e. the Assessee Trust in respect of the Larger Property save and except the Slum Portion ('the Remaining Property') for a total consideration of Rs. 65 crores subject to.the sanction of the Charity Commissioner u/s 36 of the Maharashtra Public Trusts Act 1950. (para 5 (b) internal page 16 of....
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....r in possession, that the possession of the Purchaser in respect of certain portions was in their capacity as lessees. 3.13. With regard to applicability of provisions of 2(47)(v) of the Act as stated by the ld PCIT in his section 263 order, we hold that the possession referred to in Section 53A of the Transfer of Property Act, 1882, should be in part performance of the contract under which the transfer is intended to take place. In the present case, the possession of the purchasers i.e. the said 6 Defendants, was in their capacity as Lessees and that too only in respect of their respective portions occupied by them. In fact there are almost 41 Lessees / Sub-lessees against whom the Suit was filed, only 6 of the Defendants have agreed to purchase the Remaining Property on 'as is where is basis' i.e. subject to the possession of the 41 Lessees/sub-lessees. This is not a case where the property in its entirety is sold to a sitting Lessee. Even otherwise Section 53A of Transfer of Property Act, 1882 , refers to possession in part performance of the very same contract under which the transfer is agreed to take place. Here the possession is under the Lease of 1950 and not in part per....