TaxTMI 
TaxTMI 
2025 (2) TMI 1733
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....appeals) having allowed the plea of the Appellant that it is entitled to benefit of set off of brought forward excess expenditure from earlier Years, is not justified in denying the same on the ground of return of income not being filed within the due date prescribed under section 139(1) of the Act in the facts and circumstances of the case. 4. The learned Commissioner of Income-tax(Appeals) erred in law in holding that the benefit of section 11 is not available on account of return of income for the A.Y. 2015-16 having been filed on 22/03/2017 as opposed to due date of 30/09/2015 under section 139(1), without appreciating the fundamental fact that the legislature introduced the pre-condition of ITR filing vide sub-section (9) of section 13 of the Act only w.e.f. assessment Years 2016-17 onwards in the facts and circumstances of the case. 5. Without prejudice the learned AO ought to have allowed application of Rs 2,94,02,713 as claimed by the Appellant in the return of income which was related to the relevant assessment year in full. 6. Without prejudice the learned CIT(A) ought to have granted the liberty to the Appellant to file the Form 10 to enable th....
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....e facts and circumstances of the case. 6. Without prejudice, the learned Commissioner of Income Tax (Appeals) failed to appreciate that the condition of filing the ITR within due date is only for carrying forward the losses of the present year and the same does not preclude the entity from setting off the brought forward losses and therefore the reasoning of the AO and the CIT(A) are bad at law in the facts and circumstances of the case. 7. Without prejudice the learned AO ought to have allowed application of Rs. 99,05,341/- as claimed by the Appellant in the return of income which was related to the relevant assessment year in full. 8. The learned Commissioner of Income-tax (Appeals) erred in not appreciating the fact that the accumulation under sub clause a of sub section 1 of section 11 has to be allowed at 15 percent of the Gross receipts and not on Net receipts 9. Without prejudice to the right to seek waiver with the Hon'ble CCIT/DG, the appellant denies himself liable to be charged to interest u/s. 234A, 234B and 234D of the Act, which under the facts and in the circumstances of the appellant's case deserves to be cancelled. ....
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....cted to the income which is otherwise subject to tax. The AO also referred to section 11 of the Act. The AO did not allow to set off of carry forward of loss / expenditure of earlier Years and assessed income at Rs. 1,47,30,583/-. 3. Aggrieved from the above Order, assessee filed appeal before the CIT(A). During the course of appellate proceedings, assessee also relied on various case laws. The learned CIT(A) was convinced with the case laws but he distinguished the facts that the assessee filed its return of income belatedly on 22.03.2017 which is much after the due date and the cardinal principle for allowability and set off of loss is envisaged in the fact is that the return of income has to be filed in time for the purpose of allowability of set off of brought forward losses and dismissed the appeal of the assessee. 4. Aggrieved from the above Order, assessee filed appeal before the Tribunal. The learned Counsel for the assessee has filed written synopsis and the relevant portion of the written synopsis is reproduced below: 1. The learned Commissioner of Income Tax (appeals) having allowed the plea of the Appellant that it is entitled to benefit of set off of bro....
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....ld that exemption u/s 11 is allowed if the return is filed u/s 139 of the Act which includes section 139(4), then applying the same analogy set-off also should be allowed. o Reliance is placed on the Circular F.No. 173/193/2019- ITA-I dated 23.04.2019 which has clarified that a trust registered U/s 12AA of the Act could avail the benefit of exemption u/s 11 of the Act if its return of income are filed within the time allowed u/s 139 of the Act. o Reliance is placed on the decision of Kolkata ITAT in the case of Income-tax Officer (Exemption) v. Debendra and Rohini Memorial Trust [2023] 153 taxmann.com 687 wherein it was held that: 11. From perusal of the above referred circular, we find that in Para 3 of the said circular specifically states that a trust registered u/s 12AA of the Act, benefit of section 11 shall be available if the return of income is filed within the time allowed u/s 139 of the Act. It further states that orders u/s 143(1)(a) of the Act in those cases in which demand has been raised on this issue may please be rectified. From the circular, we note that an amendment was brought in by insertion of clause (ba) of section 12A(1) of the Act ....
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....d that the learned CIT(A) has wrongly distinguished the case laws relied on by the learned Counsel for the assessee. The amendment made in the Act is not applicable to the assessee and he further submitted that the carry forward of loss for the previous Assessment Year will not affect even if the assessee files return of income after due date for the impugned assessment year. The Revenue authorities cannot deny to the assessee to give benefit of carry forward of losses for earlier Years. He further submitted that the donation given by the donours are clear from the receipts issued by the assessee Trust. The learned Counsel for the assessee further relied on the judgments of Hon'ble jurisdictional High Court of Karnataka in the case of CIT Vs.Sri Durga Nimishamba Trust in IT Appeal No.443 of 2009 Order dated 05.09.2011 and submitted that the Hon'ble Court held that the contribution made towards corpus fund would not be treated as inform for the purpose of levying of tax where even if corpus fund was misused, it could not be treated as income and no income tax could be levied thereon. Where in such situation only cause open for Revenue is to seek cancellation of registration ....
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....o be utilized for the 'construction of building' is the moot question. Quite clearly, the requirement contained in s. 12(1) is "contributions made with a specific direction that they shall form part of the corpus" is relevant. It is clear that the manner in which the specific direction is to be made has not been laid down in the Act or in the IT Rules, 1962. In other words, there is no method or mode prescribed by law of giving such directions. Therefore, it would be in the fitness of things to deduce that the same are to be gathered from the facts and circumstances of each case. 9. In the case of Shri Vasupujiya Jain Derasar Pedhi (supra), a dispute had arisen as to whether the donations received can be said to be received with specific directions that they shall form part of the corpus of the trust. It was observed that the counterfoil receipts issued by the trust were under the head 'Mandir Nirman' and the same were held to be showing that the donations were treatable as corpus donations. Similarly, in the case of Agnel Charities (supra), the assessee had staged a drama for raising funds for construction of school building. The circular letter i....
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....e AO treated the corpus funds as income as the receipt copies submitted to the AO did not contain the term "corpus" in which the assessee has admitted that the receipts do not contain the term "corpus" and the donour is aware of the specific purpose and is making contribution for the specified purpose. The assessee has claimed deduction under section 11(1)(d) of the Act is contrary to the provisions of the Act in the case of the assessee. During the course of assessment proceedings, the AO did test check and noted that these receipts were made by the assessee and the assessee has no discretion to treat the contribution as corpus and where direction of the donour is important to decide the nature of corpus. In the rejoinder the learned Counsel for the assessee submitted that the amount has been received towards Annapoorneshwari Prasada Bhavana Fund. He also produced details of the corpus fund receipts which is placed on record from page Nos.1 to 69. During the course of assessment proceedings, assessee had filed complete details as required by the AO. The ledger copy was also filed and, in some instances, the assessee has received cheque also which is clear from the copy of the l....