TaxTMI 
TaxTMI 
2025 (4) TMI 2149
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....cash transactions noted in its bank account, requiring the assessee to file return of income. The assessee, however, failed to file return of income within the stipulated time. Subsequently, questionnaire was issued to the assessee, in reply to which, the assessee furnished certificate of society registration, copy of bank statement, balance sheet, income & expenditure account, receipt & payment account, computation of income and copy of 26AS, which were examined and placed on record. The Assessing Officer noted on perusal of bank statements that the assessee had deposited cash during demonetization period. He noted the aggregate amount credited in the bank account during the year to be Rs. 1,41,02,550/- whereas during the demonetization period from 09.11.2016 to 30.12.2016, the assessee was noted to have deposited Rs. 17,79,500/- in the said accounts. The bank, i.e., Axis Bank, in which assessee's bank account was maintained, informed in compliance to notice u/s. 133(6) of the Act that the assessee has deposited Specific Bank Notes (SBN) currency of Rs. 13,96,000/-. During the assessment proceedings, show cause notice was issued to the assessee intimating about the additions propo....
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....ion period noting that the assessee was unable to substantiate its explanation of cash deposits being attributable to the fees received by it in the course of running its educational institutions. In effect, learned CIT(Appeals) confirmed the order of the Assessing Officer dismissing the appeal. Aggrieved by the same, the assessee has come up in this appeal before us raising following grounds : 1. That having regard to facts and circumstances of the case, learned authorities below have erred both in law and on facts in not allowing exemption under section 10(23C)(iiiad) of the Income Tax Act, 1961 eligible to a Registered Society existing solely for educational purposes wherein annual receipts of such institution did not exceed Rs. 2. That having regard to facts and circumstances of the case, learned authorities below have erred both in law and on facts in denying exemption under section 10(23C)(iiiad) of the Income Tax Act, 1961 for the reason of not filing of ITR under section 139 of the Income Tax Act, 1961 and treating the return filed beyond the expiry of the time specified notice under section 142(1)(i) as invalid and non-est. 3. That having regard ....
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....o the remand report has been considered. It is a fact that the AO had applied net profit rate of 8% in the absence of any evidence for exemption available to the appellant. The AO has not mentioned section 44AD as claimed by the appellant. The AO has clearly mentioned that the appellant has failed to produce any documentary evidences regarding exemption as claimed therefore, all receipts from educational institutions are treated as business receipts and business income of the appellant has been computed on estimate basis for A.Y. 2017-18 @ 8% of Rs. 1,16,19,807/-. The appellant has not filed return of income within the time allowed u/s. 139(1)/139(4) as also no valid return had been filed in response to notice u/s 142(1) of the I.T. Act. Thus, the AO in the remand report submitted that in the absence of a valid return benefit of section 11 is not available to the appellant. However, the appellant submitted that it has not claimed benefit of section 11 but it has claimed exemption u/s 10(23C)(iiiad) of the Act. Evidently, the receipts of each of the institutions are below the threshold of Rs. 1 crore as prescribed under Section 10(23c)(iiiad), hence the claim to that extent is valid....
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....se (iiiad) of section 10(23C) shall, if the total income of such educational institute,without giving effect to the benefit of exemption provisions,exceeds maximum amount which is not chargeable to tax shall furnish the return of income. Plainly speaking, section 139 only prescribes the persons and circumstances and conditions, in which different assessees are required to file their returns of income. The provisions of section 139(1) are reproduced hereunder for clarity : 139. (1) Every person,- (a) being a company or a firm; or (b) being a person other than a company or a firm, if his total income or the total income of any other person in respect of which he is assessable under this Act during the previous year exceeded the maximum amount which is not chargeable to income-tax, shall, on or before the due date, furnish a return of his income or the income of such other person during the previous year, in the prescribed form and verified in the prescribed manner and setting forth such other particulars as may be prescribed. . . . . (4C) Every- . . . (e) fund or insti....
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....ponse to notice u/s. 142(1) has to be treated as invalid. During the course of hearing Learned DR was directed to point out as to which provision of law provided a belated return filed in response to notice u/s. 142(1) to be treated as non-est. He was unable to draw our attention to any provision in this regard. On the contrary, attention of the ld. DR was drawn to section 234A of the Act which provided for interest to be charged from the assessee for filing belated return in response to notice u/s. 142(1) of the Act. The provisions of section 234A are reproduced here : 234A. (1) Where the return of income for any assessment year under sub-section (1) or sub-section (4) 43[or sub-section (8A)] of section 139, or in response to a notice under sub-section (1) of section 142, is furnished after the due date, or is not furnished, the assessee shall be liable to pay simple interest at the rate of one per cent for every month or part of a month comprised in the period commencing on the date immediately following the due date, and,- 10. When the statute itself recognizes belated return being filed in response to notice issued u/s. 142(1) of the Act, condoning their delay by....
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....o not mention whether the same are accepted in SBN or not. Further, even if it is presumed that the same were in SBN than the appellant had accepted SBN currency in spite of the fact that the same are not a legal tender, in form of fees and had deposited SBN currency of Rs. 13,96,000/- in its bank account. The appellant has not submitted any cash book, complete details of SBN accepted during the demonetization period, opening balance of cash before demonetization period etc. Hence, the action of the appellant cannot be approved in light of the fact that the Government had banned the general public except specific persons to accept the SBN from any person. Merely stating that the said cash was from the fee receipts is not conclusive proof. The onus to prove that the said cash deposit is from the fee receipts is on the appellant by producing the evidences with its books of account before the AO during the assessment proceedings. The appellant also failed to avail the benefit of submitting the same to the AO during the remand proceedings. Hence, the appellant failed to establish the source of cash deposit of SBN during the demonetisation period. In view of the same, the addition made ....