TaxTMI 
TaxTMI 
TaxTMI 
2022 (9) TMI 1186
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....ent Years 2012-13, 2013, 14 & 2014-15 respectively. I.T.A. No. 225/DEL/2018 (A.Y 2012-13) 2. The grounds of appeal are as under:- 1. On the facts and in the circumstances of the case and in law, whether the Ld. CIT (A) was correct in holding that spending by the trust outside India without the approval of the CBDT u/s 11(1 )(c) of the Act is permissible, despite that the facts and ration of relied upon cases were not directly related to application of section 11 (1 )(c) of the Act. 2. On the facts and in the circumstances of the case and in law, whether the Ld. CIT (A) erred in not appreciating the decision of the Hon'ble Delhi High Court in the case of NASSCOM, in which the Hon'ble Court held that non observance of the condition in s....
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.... & 12 of the Act. The return was processed u/s 143(1) of the Act, the case was selected for scrutiny and the notices were issued to the assessee. The assessee has participated in the assessment proceedings through its representative. During the assessment proceedings, it has been noticed that as per the balance sheet, the assessee has incurred expenses in foreign currency outside India under the head "Expenses on Specialized fairs and Buyers Seller Meet Abroad" amounting to Rs. 3,24,65,367/-. As per the A.O, the same is in contravention to provision of Section 11(1) (c) of the Act, before the approval of Central Board of Direct Taxes. 4. It is the case of the assessee before the Assessing Officer that 'as per Section (11)(1)(a) of the Act ....
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.... 6. As against the assessment order dated 20/03/2015 the assessee has preferred an Appeal before the CIT(A) and the Ld.CIT(A) has deleted the addition made by the Ld. A.O. vide order dated 31/10/2017. 7. Aggrieved by the order dated 31/10/2017, the Revenue has preferred the present appeal on the grounds mentioned above. 8. We have heard the parties, perused the material on record and gave our thoughtful consideration. 9. It is found from the record that the Ld.CIT(A) has considered the assessment order submission of the assessee and the remand reports both by Assessing Officer as well as comments of Joint Commissioner of the Income Tax and also the rejoinder of the assessee. While dealing with the appeal filed by the assessee and it is f....
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....ed. The assessee has utilize the funds as per the terms and conditions of the grant and the grants are not to be utilized in any other purpose than for which it is issued and also that the execution of the project is not be entrusted to any other organization. Further, the up spent grant along with interest @10% from the date of release of the fund has to be reimbursed by the Government. Therefore, from the above facts, it is evident that the assessee is not free to use the funds voluntarily as per its own whims and fancies and the same has to be spent as per the terms and conditions of the grant. 12. The Hon'ble Delhi High Court in the case of Director of income Tax Vs. Society for Development Alternatives (2012) 205 Taxman 373 Delhi has ....
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....n based on the findings in the case of Nimral Agricultural Society Vs. Income Tax Officer. The relevant extract is as under:- "10. The grants received from Bread for the World were for specific purposes. The grants which are for specific purposes do not belong to the assessee-society. Such grants do not form corpus of the assessee or its income. Those grants are not donations to the assessee so as to bring them under the purview of section 12 of the Act. Voluntary contributions covered by section 12 are those contributions freely available to the assessee without any stipulation which the assessee could utilize towards its objectives according to its own discretion and judgment. Tied-up grants for a specified purpose would only mean that ....
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.... Indian and supervising the execution of Schemes. It has no discretion to utilize the amount as per own requirements. It also found that in case of non-utilization at the close of the Scheme, the funds are to be refunded along with interest to the Government of India and state Governments. The grants received by the assessee do not belong to the assessee-society. The grants do not form corpus of the asseesee nor is it income of the assessee under Section 11 of the Act. Such grants are not the donations or voluntary contributions under Section 12 of the Act. Thus, the grants received by the assessee should not be considered either as income or for ascertaining the amount expanded or amount to be accumulated. Provisions of Section 11 and 12 o....