Income Tax Appellate Tribunal - Panji
Ito(E), Jaipur vs Kamaksha Maa Shailedra Baba Kamdhenu ... on 11 August, 2017
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IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES, JAIPUR
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BEFORE: SHRI BHAGCHAND, AM AND SHRI KUL BHARAT, JM
vk;dj vihy la-@ITA No. 1077/JP/2016
fu/kZkj.k o"kZ@Assessment Year : 2012-13.
Income Tax Officer (Exemption), cuke M/s Kamaksha Maa Shailendra Baba
Ward-2, Vs. Kamdhenu Seva Sansthan Trust,
Jaipur. Mukundgarh, Jhunjhunu.
LFkk;h ys[kk la-@thvkbZvkj la-@PAN No. AABTM 7746 C
vihykFkhZ@Appellant izR;FkhZ@Respondent
jktLo dh vksj ls@ Revenue by: Shri S.L. Chandel (Addl. CIT)
fu/kZkfjrh dh vksj ls@ Assessee by : Shri Ramesh Sharma (Advocate)
lquokbZ dh rkjh[k@ Date of Hearing : 02.08.2017.
?kks"k.kk dh rkjh[k@ Date of Pronouncement : 11/08/2017.
vkns'k@ ORDER
PER SHRI KUL BHARAT, JM.
This Appeal by the Revenue is directed against the order of Ld. CIT (A)-5, Jaipur, dated 29.09.2016 pertaining to A.Y. 2012-13. The Revenue has raised the following grounds of appeal :-
"1. On the facts & in the circumstances of the case and in law the Ld. CIT(A) has erred in deleting the addition of Rs. 62,21,111/- on account of anonymous donation.
2. On the facts and in the circumstances of the case and in law the Ld. CIT(A) has erred in deleting the addition of Rs. 6,20,456/- as surplus in spite of the facts that documentary evidences such as Books of Accounts, Bills, Vouchers etc. were not produced during the proceedings before the AO.
3. Any other question of law as deemed fit in the facts and circumstances of the case any also be framed before the Hon'ble Tribunal in the interest of justice."2 ITA No. 1077/JP/2016.
M/s Kamaksha Maa Shailendra Baba Kamdhenu Seva Sansthan Trust.
2. Briefly stated the facts are that the case of the assessee was picked up for scrutiny assessment and the assessment was framed under section 143(3) of the IT Act, 1961 (hereinafter referred to as the Act) vide order dated 25/03/2015. During the assessment proceedings, it was observed that the information required through notice u/s 142(1) of the Act was partly submitted. Books of accounts and supporting vouchers, bills & donation receipts were not produced on the basis that the same have been destroyed in an accidental fire that occurred on 14/03/2012. It is observed by the Assessing Officer that the audit report in Form -10B was signed on 14/09/2012 by the auditor, how could the auditor verify the books of accounts when the same were lost in fire. The Assessing Officer treated the donation of Rs. 62,21,111/- as anonymous donation. Further, the Assessing Officer treated balance income assessed as 'Income from Other Sources', treating the status as AOP, without deducting any expenses thereon. Against this, the assessee preferred an appeal before Ld. CIT, who after considering the submissions, allowed the appeal.
3. Now, the Revenue has filed the present appeal.
4. Ground no. 1, is against deleting the addition of Rs. 62,21,111/- on account of anonymous donation.
4.1 Ld. Departmental Representatives vehemently argued that the Ld. CIT was not justified and casually believe the version of the assessee without making further inquiry about the veracity of the claim of the assessee. 4.2 On the contrary, Ld. Counsel for the assessee supported the order of the Ld. CIT(A) and submitted that a fire was actually occurred and the fire is not under the 3 ITA No. 1077/JP/2016. M/s Kamaksha Maa Shailendra Baba Kamdhenu Seva Sansthan Trust.
contrary and the incident is an act of the god since, the fire was occurred by the short circuit. He reiterated the submissions as made in the written submissions. The written submissions of the assessee are reproduced as under:-
"1. The Ld. Appellant Authority is right in law in deleting the absolutely wrong demand.
2. Respondent has valid registration u/s 12A & 80G of Income Tax Act means all income of trust is exempt.
3. My lord FIRE, FLOOD, CYCLONE, EARTHQUAKE AND SKY POWER FALLON EARTH, these incidents are inevitable accidents and control on these incidents is over all of GOD, these accidents are "ARCANA AELESTIA"
4. The Ld. Appellate Authority is right in law and deleted demand in the light of following decisions:-
g) Honourable Supreme Court (Full Bench) in the case of LATA WADHAWA & Ors v/s STATE OF BIHAR on 16-08-
2011, in this case fire took place in pandal and due to fire 60 persons were killed and 113 persons were injured. By the Honourable Supreme Court decided award/claims to victim.
h) Honourable Supreme Court (Double Bench) in the case of Insurance Company v/s Zuari Industries Ltd. and Ors decided 01-09-2009. In this case fire took placed due to electric short circuits and courts decided admitted fact.
(copy of decision attached)
i) Honourable DELHI HIGH COURT, in the case of Jaipur Golden Gas Victim association V/s UDI & Ors on 23-10- 2009, in this case fire took placed in the premises of Jaipur Golden Godown and there men killed and injured, by the Honourable High Court award/claims given to kith and kin of deceased and injured persons.
4ITA No. 1077/JP/2016.
M/s Kamaksha Maa Shailendra Baba Kamdhenu Seva Sansthan Trust.
(Copy of Decision attached)
5. In the case fire took place due to electric short circuit and all record of Trust was burnt in fire, FIR was lodged to Police Station, Mukundgarh.
6. Balance of conveyance be allowed in favour of respondent." 4.3 We have heard the rival contentions, perused the material available on record. The Ld. CIT(A) allowed the appeal of the assessee by observing as under:-
"2.3 I have considered the facts of the case, the penalty order and the submissions of the appellant. The core issue involved is the veracity receipts books and expenses vouchers etc. The AO has doubled the destruction of receipt books and expense vouchers etc. The AO has doubled the destruction of receipt books and expense vouchers and has consequently proceeded to treat all donations as anonymous in nature and has taxed the same in accordance with all provisions of s. 115BC r.w.s 13 (7), denying the benefit of exemption u/s 11. On going through the Police records and reports, which were also submitted before the AO, it is seen that the Police has first recorded the fire incident as a Daily Diary Report (Rojnamcha) and not as a proper FIR presumably since the incident is not a cognizable offence. However, the veracity of the same is not diluted by the above fact since the Police has proceeded with subsequent investigations in the matter and is has been unambiguously mentioned in inquiry report dated 22.03.2012 signed by the SHO concerned, that the fire took place in the room of worship and led to the destruction of documents, vouchers and around 100 books among other items such as almirahs, fax machine, computer, worship items etc. The same facts are repeated in the investigation report dated 28.03.2012 of the ASI, Police Sh. Balbir Sharma. The fact that Police has done further investigation entrusting the case to Sh. Balbir Sharma, ASI is mentioned in the 'Rojnamcha', which is also authenticated by the signature of the SHO concerned. Based on these documents it is quite clear that the fire on 14.03.2012 gutted the vouchers, receipts etc. amongst other items. It is 5 ITA No. 1077/JP/2016. M/s Kamaksha Maa Shailendra Baba Kamdhenu Seva Sansthan Trust.
further stated by the assess that the legal advisor of the Trust used to visit twice a month and note down all transactions and enter the same in his computer in 'tally' software on the basis of receipts for donations and vouchers/bills for expenses, which subsequently got destroyed in fire. However, the audit was completed on the basis of the books of account so maintained, since these were based on the receipt and vouchers. The assessee has contended that the names and addresses of donors were also maintained in the books of account maintained on computer. It was however seen that the computerized books only contain the name and town of residence of the donor and does not contain the full postal address. Be that as it may, the complete details were claimed to be maintained in the donation receipts which got destroyed in fire. It is seen that during the assessment for A. Y. 2011-2012 also, the same issue regarding destruction of records in fire came up before the AO, who passed the order u/s 143 (3) on 16.01.2014, by which time the fire incident had taken place. However, the AO accepted the fact of fire as pointed out by the assessee in its submissions during assessment proceedings for A. Y 2011-12. Accordingly, no disallowance or addition was made in A. Y. 2011-12. Although the above stated facts are sufficient to accept the destruction of relevant documents in fire, the assessee has also produced a certified copy of the relevant noting in "Agnisahayata"
Register maintained by the Tehsildar, Nawalgarh, according to which the assessee' case was , on subsequent inquiries, found to be genuine and was approved for assistance by the State Government as per C. R. F. (N. C. C. F.) norms, which independently establishes the veracity of the appellant's contentions. As regards the AO's contention relating to non-production of receipts and vouchers relating to the post-fire period, it is noted from the correspondence with the assessee and submissions of the assessee during assessment proceedings that such details were not called for by the AO specifically. It is therefore held that the assessee was unable to produce the relevant receipts and vouchers relating to the period before fire, due to their loss in the fire incident and as a result it was impossible to produce such 6 ITA No. 1077/JP/2016. M/s Kamaksha Maa Shailendra Baba Kamdhenu Seva Sansthan Trust.
documents. In similar circumstances, the AO had accepted the appellant's contentions in the assessment for A. Y. 2011-12. Hence there is no reason to doubt the fire accident and take a different stand for the year under consideration. Therefore, the treatment of donations of Rs. 62,21,111 as anonymous and taxing the amount of Rs. 59,10,055, being excess over the allowable 5 % donation u/s 115BBC, is incorrect. Similarly, the AO's action in taxing the balance receipts of Rs. 6,10,456 under the head 'Income from other sources' without allowing any expenses thereon and denying the benefit of exemption u/s 11 is not in accordance with the findings above. Since the total receipts shown by the assessee is Rs. 65,20,511 out of which the surplus is Rs. 9,05,890 which is less than 15 %, the taxable income of the appellant gets reduced to Nil."
4.4 From the above order of the Ld. CIT(A), it is evident that the Ld. CIT(A) has accepted the contention of the assessee on the basis that the details of transactions were recorded in computer. It is also contended that the auditor has certified that the accounts of the assessee presents true and fair picture of the state of financial affair of the trust. After considering the facts of the present case, we are of the view that the Ld. CIT ought to have examined the auditor who had given the audit report. Therefore, we restore this ground to the file of the Ld. CIT(A) for decision afresh. Ld. CIT(A) would decide the issue after examining the auditor who has given the audit report. Since, the claim of the assessee is that the supporting evidences i.e. bills and vouchers another material were destroyed in fire. Therefore, it was necessary to find out what was the basis of the audit report has given by the auditor. Ground no. 1 of the Revenue's appeal is allowed for statistical purpose.
5. Apropos to Ground No. 2, Ld. D/R vehemently argued that Ld. CIT(A) was not justified in deleting the disallowance.
7ITA No. 1077/JP/2016.
M/s Kamaksha Maa Shailendra Baba Kamdhenu Seva Sansthan Trust.
5.1 On the contrary, Ld. Counsel for the assessee supported the order of the Ld. CIT(A).
5.2 We have heard the rival contentions, perused the material available on record. The contention was made by the AO treating the amount as income from other sources. This issue is also related to ground no. 1. Therefore, we restore this ground to the file of the Ld. CIT(A) for decision afresh.
6. In the result, appeal of the Revenue in ITA No. 1077/JP/2016 is allowed for statistical purpose.
Order is pronounced in the open court on Friday, the 11th day of August 2017.
Sd/- Sd/-
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( BHAGCHAND) ( KUL BHARAT )
ys[kk lnL;@Accountant Member U;kf;d lnL;@Judicial Member
Jaipur
Dated:- 11/08/2017.
Pooja/
vkns'k dh izfrfyfi vxzfs "kr@Copy of the order forwarded to:
1. The Appellant- Income-tax Officer (Exemption), Ward-2, Jaipur.
2. The Respondent - M/s M/s Kamaksha Maa Shailendra Baba Kamdhenu Seva Sansthan Trust, Mukundgarh, Jhunjhunu.
3. The CIT(A).
4. The CIT,
5. The DR, ITAT, Jaipur
6. Guard File (ITA No. 1077/JP/2016) vkns'kkuqlkj@ By order, lgk;d iathdkj@ Assistant. Registrar 8 ITA No. 1077/JP/2016. M/s Kamaksha Maa Shailendra Baba Kamdhenu Seva Sansthan Trust.