TaxTMI 
TaxTMI 
2023 (9) TMI 540
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....in respect of different accounts (Mention Below) was quite unreasonable and unjustified. 3. That the addition an account of development fees for Rs. 881362.50 was wrong as it is a corpus fund for building construction cannot become part of Income as it is capital assets and will be used in development of Building Constructions. 4. The addition made for surplus of Rs. 215235/- for both funds of students is quite wrong and unjustified. The Boys Fund. surplus of students fund can never be utilized at the discretion of Management but it has been controlled by Head of the institution for the welfare of students only. 5. That the disallowance of corpus donation of Rs. 108340/ Received From Manju Mittal (Rs 22500/-), Ram singh (Rs 34880/-) and Maitra saraswat (Rs 51000/-) is quite wrong and unjustified in view of complete address & name with PAN supplied, As Previously the address supplied was old as per records available. 6. That the disallowance of capital expenditure on account of Inverter Rs 14000/- is also wrong as payment is being made by cheque. 7. That the Ld CIT(appeals) has erred in not following the Board itself in Circular No. 52 dated December 30, 1970 which has acc....
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....ime. 2.3 Now the appeal of the assessee is refixed for hearing on 19-07-2023 wherein both the parties appeared for arguments. 3.1 Brief facts of the case are that the return of income was filed by the assessee trust on 29-09-2013 declaring Nil total income. The case was selected for the scrutiny under CASS. Notice u/s 143(2) of the Act was issued on 22-09-2014 which was served upon the assessee fixing the date of hearing on 29-09-2014. Subsequently notices u/s 142(1) of the Act and the query letter were issued from time to time. In response to notices issued the ld. AR of the assessee attended the proceedings. It is also noted that the assessee is a Registered as a Society under the Registration of Societies Act, 1958 and assessee is also registered u/s 12A(a) of the Act vide letter No. SIB/Sec12A(a)/CIT.Raj-1/2809 dated 22-01-1976 which is engaged in imparting education to the students alongwith other activities. It is further noted that the assesses society is in appeal against the order of the ld. CIT(A) who had confirmed the action of the AO as mentioned in the assessment order. 4.1 During the course of hearing, the Bench noted that the Ground No. 1, 2, 10 & 11 of the assess....
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....CIT(A). 5.4 We have heard both the parties and perused the materials available on record. During the course of assessment proceedings the AO made the addition of Rs. 2,15,235/- by observing that the assessee society neither had taken the income/ the expenditure of the funds nor did it take the surplus so generated of both funds while computing the surplus of the society in consolidation. Thus a sum of Rs. 2,15,235/- being surplus of both funds was not taken into account while consolidating the total accounts. In first appeal, the ld. CIT(A) has confirmed the addition of Rs. 2,15,235/- made by the AO. The Bench has noted the submission of the ld. AR of the assessee and found that the submission made by the ld. AR of the assessee is appropriate as surplus fund can never by utilized at the discretion of the Management as it is controlled by the Head of the Institution for the welfare of students only. In this view of the matter, we concur with the submissions of the ld. AR of the assessee and thus the Ground No. 4 of the assessee is allowed. 6.1 Apropos Ground No. 5 of the assessee, the facts as emerges from the order of the ld. CIT(A) are as under:- ''7.3 I have gone through the ....
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.... students of the school. Hence, looking to the fairness of the assessee with regard to payment of Rs. 14,000/- to the party M/s.Kiran Battery Co. Ajmer, we allow the Ground No.6 of the assessee. 8.1 Apropos Ground No. 7 & 8 of the assessee, the facts as emerges from the order of the ld. CIT(A) are as under:- ''9.3 I have gone through the assessment order, statement of facts, ground of appeal, written submission, remand report and rejoinder carefully. The AO has taxed the net surplus of Rs. 25,80,833/- as the appellant had failed to apply 85% of total receipts of Rs. 1,36,01,164/-. The appellant was required to apply Rs. 1,15,60,989/- whereas the appellant had applied only Rs. 1,08,63,975/-. The appellant had not submitted Form No. 10 as required u/s 11(2)(a) of the Act before the due date of filing of return of income. Thus, the accumulation of income was more than 15% of the gross receipts. As the appellant had failed to fulfill the condition laid down u/s 11 (2)(a), hence the action of the AO denying the benefit of Section 11(2) of the appellant is held to be fully justified and in accordance with the provisions of law. Further, the AO has also discussed the objects of the Tru....