TaxTMI 
TaxTMI 
2026 (2) TMI 1039
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....-23 and 2023-24 respectively. The assessment was framed by the Assessing Officer [for short, AO] u/s 143(3) of the Act. 2. The assessee has raised following grounds of appeal: "1. Because the learned CIT(A) has committed a manifest error in disposing of appeals pertaining to two distinct assessment years through a single consolidated order, without adjudicating each ground of appeal separately. This approach violates the mandatory requirements under Section 250(6) of the Income Tax Act, 1961, which obligates the appellate authority to pass a speaking order containing reasoned findings on each issue raised. The impugned order is non-speaking, lacks independent reasoning, and thereby infringes the principles of natural justice, re....
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....(2)/2023- 24/1053520648(1) dated 02.06.2023 in violation of CBDT Instruction F.No.225/157/2017/ITA-II dated 23.06.2017. The said notice is invalid and the assessment framed pursuant thereto stands vitiated in law. 3. The brief facts of the case are that the assessee is a 120-year-old, wholly religious, registered society under the Societies Registration Act, 1860 (See PB 2022-23, Page 10). The society maintains ancient and renowned Mandirs (temples), namely two major temple complexes at Hastinapur, District Meerut, known as "Prachin Bada Mandir" and "Shri Kailash Parvat Rachna", along with a Dharamshala, in accordance with its objects. (Objects: PB 2022-23, Pages 11-14; List of Temples: Pages 15-18). To fulfil its objects, society requir....
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....2-23, Pages 19-21). The learned Assessing Officer disallowed 30% of the expenses claimed under Section 57 (iii) and accordingly added Rs. 1,44,62,230 to the income of the assessee vide assessment order dated 11-03-2024 under Section 143(3) read with Section 144B. 6. The said disallowance was sustained by the CIT(A) who held that the assessee, being an AOP, cannot collect donations, and donations are not income earned by it. Further, since the assessee is not registered under Sections 12A and 80G, deduction under Section 57 is not allowable. Further, Voluntary contributions amounting to 4,30,90,568 for AY 2022-23 and Rs.4,92,49,603 for AY 2023-24 were not "earned" income but donations. The CIT(A) held that the assessee failed to substanti....
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.... the absence of registration under Sections 12A or 80G does not prohibit an AOP or religious society from receiving donations, nor does it bar deduction under Section 57. The ld AR further submitted that Sections 11 and 12 govern exemption of charitable trusts; they do not restrict religious societies or AOPs-without such registration-from receiving donations or claiming deductions under Section 57. 11. The ld AR submitted that the Donations are Earned in the Course of Activities as they were received in consideration of puja, food, accommodation, and religious services, for which corresponding expenditure was incurred strictly in accordance with the objects of the society. Hence, the disallowance is legally unsustainable. Further, these....
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..... Per contra, the ld DR heavily relied on the orders of the AO and the CIT(A). 15. We have heard the rival submissions and perused the relevant materials on record. We find that the assessee had received a voluntary contribution of Rs. 4.30 Crore and had claimed deduction u/s 57(iii) of Rs. 4.82 Crores. The AO had disallowed 30% of the expenses claimed u/s 57(3) and has not disclosed the reasons for such disallowance. There is no description in the assessment order that the voluntary contribution was not genuine or was not received in the course of its activity or that the expenses made by the assessee was not substantiated by any evidence. 16. We are of the considered view that that section 57 (iii) requires that the expenditure must....
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....ly answered by the SMC Bench of Delhi ITAT in the case of Shri Sanatan Dharam Mandir Sabha v. ITO (supra) which had an identical set of facts. There the assessee was registered under the Societies Registration Act; was Running a temple and was not registered under Sections 12A/80G. The Income was assessed under "Income from Other Sources" but deduction under Section 57(iii) was disallowed. The ITAT held that even if exemption under Sections 11 & 12 is denied, all relevant expenses under Section 57(iii) must be allowed and that the lack of registration under Sections 12A/80G does not bar Section 57 deduction. It held that the voluntary contributions are taxable under "Income from Other Sources" and related expenses are deductible. 18. Res....