Income Tax Appellate Tribunal - Chandigarh
Dcit, C-2 (Exemption), Chandigarh vs M/S Chintpurni Temple Trust, ... on 15 May, 2018
IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH 'A', CHANDIGARH BEFORE SHRI SANJAY GARG, JUDICIAL MEMBER AND MS. ANNAPURNA GUPTA, ACCOUNTANT MEMBER ITA No.1339/Chd/2017 (Assessment Year : 2013-14) The D.C.I.T., Vs. M/s Chintpurni Temple Trust, Circle-2,(Exemption), Chintpurni, Amb Una, Chandigarh. HP.
PAN: AAATC6476G
(Appellant) (Respondent)
Appellant by : Smt.Chanderkanta,
Sr.DR
Respondent by : Shri Ashwani Kumar, CA
Date of hearing : 25.04.2018
Date of Pronouncement : 15.05.2018
O RDE R
PER ANNA PURNA GUPTA, A. M. :
Th i s a p p e a l h a s b e e n p r e f er r e d b y t h e R e v e nue a g a i n s t t h e o r d er o f l e a r n e d C om m i s s i o n er o f I n c o m e Ta x ( A p p e a l s ) , P a l a m p u r ( he r e i n a f t e r r e fe r r e d t o a s C I T( A p p e al s ) ) d at e d 1 9 . 6 . 20 1 7 , re l a t i n g t o a s s e s sm e nt y e a r 2 0 1 3- 1 4 .
2. Th e s o l e i s s u e i n t h e p r e s e nt c a s e r e l a t e s t o c l a i m o f e x e mp t i o n a s p e r t h e pr o v i s i o n s o f s e c t i o n 11 a nd 1 2 o f t h e I n c o me Ta x A c t , 1 9 6 1 ( i n s h o r t 't h e A ct ' ).
3. Brief fa c t s r e l at i n g to the c as e are that t he a s s e s s e e t r u s t i s r u n n i n g a t e mp l e , " M a ta C h i n tp u r ni Te m p l e " , a n d h ad b e e n g r a n te d re g i s t r a ti o n u/ s 12 A of the Act. D u r i ng assessment p r o c e e d i ng s for the i m p u g n e d ye a r , t h e A O f o u nd th a t t h e a s se s s ee h a d 2 b e e n a c c um u l a t i n g i t s i n c o m e f o r t h e l as t f e w y e ar s by f i l i n g F o r m N o . 10 . Th e A O a l s o n o t e d th a t a s per t h e p r o v i s i o ns o f s e ct i o n 1 1 ( 3 ) of t h e A c t , t h e a s s es s e e w a s r e q u i r e d t o u ti l i ze t h e i n c o m e s o a c c u m u l a te d w i th i n a p e r i o d o f fi v e ye ar s f r o m t h e e n d o f t h e y e a r i n w hi c h i t w a s e a r ne d , f ai l i n g w h i c h t h e s am e w a s to be tr e a t e d a s i n c om e of t he p r e v i o u s y e a r i m m e d i a t el y fo l l o w i n g the e x pi r y of th e said period. In th e c as e of t he a s s e s s e e , t h e AO n o t e d t h a t f or t h e F . Y . 20 06 - 0 7 , p e r t a i n i ng t o A . Y. 2 0 0 7 - 0 8 , t h e u nu t i l i z e d i n co m e of t h e assessee a m oun t e d to R s . 2 , 36 , 8 0 , 3 8 4 /- and the assessee had fu r n i s h e d Form 10, a c c u mu l a t i ng i ts i n c o m e , t o th e e x t e n t of R s .2 . 5 0 c r o r e s . Th e A O fu r t h er f o u n d t h a t t h e a s s e s s e e ha d b ee n f i l i n g Fo r m N o . 1 0 , c o n t i n u o us l y f r om f i n a n c i a l y ea r 2 0 0 6 - 0 7 o n w ar ds a n d i n a l l t h e ye a r s t h e a ss e s s e e h ad n o t ut i l i z ed 85 % of i t s i n c om e a s pr e s c r i b e d u n d e r t h e A c t f o r c l ai m i n g exemption of i ts entire i n c o me , and e v en in the impugned y e ar 85% of its receipts had n ot been u t i l i z e d. H e , t h e r e f o r e , h e l d t ha t t h e a s s e s s e e c o u l d not have p os s i b l y utilized the accumulated r e c e i p t s /i n c o m e r e l a t i n g to f i n an c i a l ye a r 2 0 0 6 -0 7 o f R s . 2 , 3 6 , 80 , 3 8 4 /-, w i t h i n f i v e y ea rs i . e . u p t o F . Y . 20 1 1 - 1 2 , a n d t he r e f o re b r o u g h t t h e sa m e t o t a x i n th e F .Y 2 0 1 2 - 1 3 , p e r t ai ni n g t o t h e i m p u gn e d as s e s s m en t y e a r i . e . A . Y. 2 0 13 - 14 , a s p e r t h e p r o v i s i o ns o f s ec t i o n 1 1 ( 3 ) o f t h e A ct .
3
4. Before the Ld . CI T( A p p e a l s ) , the a s s e s see c o n t e n d e d t h at i t h a d u t i l i z e d t he a c c u m u l a t ed i n c o me o f f i n a n c i a l y e ar 2 0 0 6 - 0 7 , p e r ta i n i n g t o a s s e ss m e nt year 2 0 07 - 0 8 , in the s u b s e q ue n t year i t s el f i . e. a s s e s s m e nt y e ar 2 0 0 8 - 0 9 . Th e a ss e s s e e c o n t e n ded t h a t o u t o f t h e a m o un t s e t a p a r t/ a c cu m u l a t e d b y i t , i t h ad d e p o s i t e d R s . 2 ,1 7 , 2 7 , 8 1 1/ - i n Ba n k a / c ' s w h i ch w as utilized in s u bs e q u e n t A .Y i.e. A.Y. 2 00 8 - 09 . Th e assessee submitted a c ha r t showing the said u t i l i z a ti o n r e pr od u c e d a t p a g e 5 o f t h e CI T( A ) 's o r d e r , as under:
2007 2008 2009 2010
C/F 36882383 42717400.28 98481729.29
Total receipts 88013321.00 110415469.28 139022438.01 161863963.49
Grand total 88013321.00 147297852.28 181739838.29 260345692.78
Revenue exp. 50864472.00 61603274.00 83114333.00 94402135.00
Capital exp. 266466.00 42977178.00 143776.00 7346063.30
Total exp. 51130938.00 1045 80452.00 83258109.00 101748198.30
Set aside 25000000.00 40000000.00 40000000.00 40000000.00
Carry forward 11882383.00 2717400.28 58481729.29 118597494.48
2011 2012 2013
158597494.48 233174911.84 325778.44.42
Total receipts 191612895.86 237175020.58 324430100.84
Grand total 350210389.84 470349932.42 650208145.26
Revenue exp. 112861181.00 141786540.00 160931959.00
Capital exp. 4174297.00 2785348.00 4006303.00
Total exp. 117035478.00 144571888.00 164938262.00
Set aside 50000000.00 60000000.00 110000000.00
Carry forward 183174911.84 265778044.42 375269883.26
5. Th e a s s e s s e e con t e n d e d t h a t t he t o t a l u t i l i z a t i on for A . Y. 2 0 08 -0 9 of R s . 1 0 ,45 , 8 0 , 4 5 2 /- , i ncl u d e d R s . 2 , 1 7 , 47 , 8 1 1 /- which was out of the a mo u n t a c c u m u l a te d a nd k e p t i n ba n k a / c i n t h e p r ec e d i n g 4 y e a r . Th e a s s e s se e f u r t h e r a dm i tt e d t h a t t h e re wa s a s h o r t f a l l i n u t i l i z a t i o n o u t of t h e a c c u m u l a t ed am o u n t t o t h e e x t e n t o f R s . 1 9 , 3 2 ,5 7 3 / - , a d d i t i o n o n a c cou n t o f w h i c h w a s s u s t ai n a b l e .
6. Th e L d . C I T( A pp e a l s ) , a ft e r considering t he s u b m i s s i on s m ad e b y t h e a s se s se e a n d d e t a i l s f i l e d b y the a s s e s se e f ou n d that the assessee ha d duly d e m o n s t r at e d the u t i l i z a t i o n o f i ts a c c u m ul a t e d i nc o m e p e r t a i n i ng t o a s se s s m e n t y e a r 2 00 7 - 0 8 t o t h e e x te n t o f Rs. 2 , 1 7 ,4 7 , 8 1 1/ - in the su c c e e d i n g year and, t h e r e f o r e, d e l et ed t h e a d di t i o n m a d e b y th e A s se s s i ng O f f i c e r t o t h i s e x t e n t , u p h ol d i ng t h e b a l a n c e . Th e r e l e v a n t f i n di n g s o f t he CI T( A p p ea l s ) a t p a r a 7 of h i s o r d e r i s a s u n de r:
"7. I have considered the facts of the case and written submissions of the appellant. Ld. AO made an addition of Rs.2,36,80,384/- of the unutilized amount accumulated or set apart in F.Y. 2006-07 u/s 11(2) of the I.T. Act through Form 10 and which had not been utilized within five years as per provisions of-section 11(3) of the Act.
During appeal, the appellant filed copes of Form 10 filed for A.Y. 2007-08. A.Y. 2008-09 and AY 2013-14 and a tabulation of the amounts carried forward (15% of receipts) and amounts set apart or accumulated u/s 11(2) through Form 10 from AY 2007-08 onwards. A perusal of the same reveals that the appellant gave notice of accumulation of Rs.2,36,80,384/-alongwith the ITR for A.Y 2007-08. As on 31.3.2017 , the appellant had unutilized funds of Rs.3,68,82,383/- which comprised accumulation u/s 11(2) of Rs.2,50,00,000/- and other funds out of the 15% receipts amounting to Rs.1,18,82,383/- . The amount of Rs.3,68,82,383/- was utilized in the next F.Y. 2007-08. Out of total receipts of F.Y. 2007-08 of Rs.11,04,15,469/-, 85% i.e. Rs.9,83,53,148/- was required to be utilized for claiming 100% exemption. The appellant gave notice of accumulation for Rs.4,00,00,0007- u/s 11(2) of the Act. In other words, Rs.5,83,53,1487- was required to be spent 5 out of the receipts of Rs.11,04,15,4697-. As against it, the appellant spent Rs.10,45,80,4527- in F.Y.2007-08 . Out of Rs.2,36,80,384/- accumulated u/s 11(2) of the Act in F.Y. 2006-07, Rs.2,17,47,811/- only has been shown to have been utilized in F.Y. 2007-08, it has been stated by Ld. AR that the amount spent in F.Y. 2007-08, i.e., Rs.10,45,80,452/- included Rs.2,17,47,8117- which was kept in the various bank of the appellant as specified u/s 11(5) of the Act as on 31.3.2007 and was utilized in the next year ending 2008.
In view of the above, addition of Rs.19,32,5737- (Rs.2,36,80,384- Rs.2,17,47,811/-) is confirmed. The appellant get a relief of Rs.2,17,47,811/-. Ground of appeal 2 is partly allowed."
7. A g g r i e v e d b y th e s a m e , th e R e ven u e h a s c o m e up i n a p p e a l b e f o re u s r a i s i ng f o l l o wi n g g r o u nd s :
"i. That on the facts and circumstances of the case, the Ld. CIT(A) has erred in law in ignoring the facts that the amount accumulated u/s 11(2) is to be utilized within a period of five years from the end of the year in which the income was generated which the assessee failed to do and accordingly was liable to be taxed in the immediately following year after the period of five years.
ii. That on the facts and circumstances of the case, the Ld. CIT(A) has erred in law in deleting the addition of Rs.2,17,47,811/- as From No. 10 was filed by the assessee for A.Y. 2008-09 before the ITO specifying the expenses towards 'Pujari Share and other charitable purpose' which is not a specific expense and is not covered as per provisions of section 11(2) of the Income Tax Act, 1961.'
8. D u r i n g t h e c ou r se o f h e a r i n g b ef or e u s t h e L d . D R r e l i e d u po n t h e o r d e r o f t h e A s s e s s i n g O f f i cer a n d stated t h at ut i l i z a t i o n of a c c u m u l a te d income p e r t a i n i ng to financial y e ar 2 00 7 - 0 8 had not been d e m o n s t r at e d / p ro v e d b y t he a s se s s e e i n th e n e xt f i ve y e a r s s i nc e i t h ad b e e n c on t i n u ou s l y s h o wi n g s ho r t f a l l i n u t i l i z a ti o n an d t h u s a c c u mu l a t i n g i t s i n com e f o r u t i l i z a ti o n i n t he n e x t f i v e y e ar s b y fi l i n g F o r m N o . 1 0 6 a n d , t h e r e f or e , th e A s s e s s i n g O f fi c e r h a d r i g h t l y m a d e a d d i t i o n o f t h e u n u t i l i ze d a m ou n t i n t he i m pu g n ed year.
9. Th e L d . c o u ns e l f o r a s se s s e e , o n t h e ot h e r h a n d , r e l i e d u po n t h e fi n d i n g s of t h e CI T( A p p e a l s ) .
10. W e h a v e h e ar d th e c o n t e n ti o n s of b o t h t h e p a r t i es a n d h a v i ng g o n e t h r o u g h t h e o rde r s o f th e a u th or i t i e s b e l o w . Th e i s s u e b e f o r e u s r e l a t es t o a d d i t i o n m ad e a s per t h e p r o vi s i o n s of s e c ti o n 1 1 ( 3 ) of t he A ct , on a c c o u n t o f n o n u t i l i z a ti o n o f t he a c c u m u l a te d i n c o m e o f A . Y . 2 0 0 7 -0 8 , a m o u n t i n g to R s. 2 , 3 6 , 8 0 ,3 8 4 / - wi t h i n n e x t f i v e y e a rs .
11. I t i s n o t d i s p ut ed t h a t t he u n u ti l i z e d a m ou n t o f income of th e assessee fo r A.Y. 2 0 0 7 -0 8 was R s . 2 , 3 6 , 80 , 3 8 4 /-a n d t h e am o u n t a c c u m u l at e d by t h e a s s e s s e e f o r u t i l i z a t i o n wi t h i n f i ve y e a r s b y fi l i n g F o r m No.10, a m ou n te d t o R s . 2 .5 0 c ro r e s . Th a t o u t of t h e u n u t i l i z ed i nc om e , the a s ses s e e h ad d e po s i t e d R s . 2 , 1 7 , 47 , 8 1 1 /- i n b an k a /c ' s i s a l s o n o t d i s pu t e d . Th a t t h e a s s e s se e w a s r e q u i re d t o u t i l i z e t h e am o u n t s o a c c u m u l a t ed w i t h i n f i v e y ea r s f a i l i n g w h i ch t h e same w o ul d be deemed to be the i n co m e of t he a s s e s s e e o f t h e p r e v i o u s y e a r f ol l o w i n g t h e e x p i r y of f i v e y e a r s, s p er s e c t i o n 1 1( 3 ) , i s a l s o a n a c ce p t e d position of l a w. Th a t in the i m p u gn e d case, a c c o r d i n gl y th e f a i l u r e t o u t i l i ze t h e sa i d a m o un t b y A . Y 2 0 1 2 - 13 , wo u l d r e s u l t i n a d d i t i o n of t h e s a m e 7 b e i n g m a d e t o t h e i n c o m e o f t h e a s s e s s ee f or t h e i m p u g n e d y e a r i .e . A . Y . 20 1 3 - 1 4 i s a l s o n ot d i s pu te d .
12. H a v i n g s a i d s o , w e f i n d t h a t t h e L d . C I T( A p p ea l s ) h a s g i v en a ca te g o r i c a l f i n d i n g o f f a c t t h a t t h e s a i d a c c u m u l a te d i n co m e t o t h e e x t e n t o f R s . 2 , 1 7 , 4 7,8 1 1 / - w a s u t i l i z e d i n th e s u c c ee d i n g ye a r i . e . A . Y . 2 0 08 - 0 9 . Th e L d . C I T( A p p ea l s ) h a s f o u n d th a t t h e i n c o m e of A . Y . 2 0 0 8 - 0 9 w a s R s .1 1 . 0 4 , 1 5 ,4 6 9 / - ,of w h i c h t h e a s s es s e e was required to utilize 85% a m o u nt i n g to R s . 9 , 8 3 , 53 , 1 4 8 /-. Further, it was found t h at the assessee had utilized R s . 1 0 ,45 , 8 0 , 4 5 2 /- , and had a c c u m u l a te d Rs. 4 c r o re in the A.Y. 2 0 0 8 -0 9 . Th e aforesaid facts have not b ee n c o n t r o v e rt e d by the Revenue. C o n s i d e r i n g t h a t t h e ut i l i z a t i o n o f A . Y 2 0 0 8 - 0 9 i n c l ud e d t he a m o u n t ac c u m u l a t e d i n t h e pr e ce d i n g y e a r i . e . A . Y . 2 00 7 - 0 8 a m o u n ti ng t o R s . 2 , 1 7 , 47 ,8 1 1 / - a n d e x c l u d i n g th e s a m e f r o m th e u t i l i z a ti o n f or A . Y . 2 0 0 8 - 0 9 , t h e as se s s e e h a s s h o wn b a l a n c e u t i l i z a t i o n o f income in A . Y . 2 0 08 - 0 9 of R s .8 , 28 , 3 2 , 6 4 1 ( 1 0 , 4 5 , 8 0, 4 5 2 - 2 , 1 7 , 4 7 , 81 1 ) w hi c h f a l l s s h o r t o f t he s t i p u l a t ed 8 5 % u t i l i z a ti o n o f t he i n c o m e f o r t he y e ar w h i c h co m e s t o R s . 9 , 8 3 , 53 , 1 4 8 /- b y Rs . 1 , 5 5, 2 0 , 50 7 / - ( 9 , 8 3 , 5 3 ,1 4 8 - 8 ,28 , 3 2 , 6 4 1 ) . Th e sa m e h a s b e e n d ul y s e t p a r t b y t h e a sse s s e e b y f i l i n g F o r m N o . 1 0 fo r A . Y . 2 0 0 8 - 0 9 , a c cu mu l a t i n g R s . 4 cr or e s f o r u t i l i za t i o n i n the next five years. Th u s we agree wi t h the L d . CI T( A p p e a l s ) t h a t t he u t i l i z a ti o n o f A . Y . 2 0 08 - 0 9 8 i n c l u d e d t h e a mo u n t a cc u m u l ate d a n d k e p t i n b a n k account in the preceding year of R s . 2 ,1 7 , 4 7 , 81 1 / -. A n d t h e r e f o re t h e a c c u m u l a t ed i n c o m e o f A . Y . 2 0 07 - 0 8, s t o o d u t i l i z e d i n s u b s e q u e nt A . Y . i . e . A . Y. 2 0 0 8 -0 9. W e t h e r e f o r e f i n d n o r e a s o n t o i n t e r fe r e i n t h e or d e r o f t he C I T( A ) de l e t i ng ad d i t i o n of R s . 2, 17 , 4 7 , 8 1 1 /- .
G r o u n d s o f a p pe a l r a i s e d b y th e R e v e n u e a r e, t h e r e f o r e, d i s mi ss e d .
13. In the r es u l t , the a p p e al of the R e v e nu e is d i s m i s s e d.
O r d e r p r on o u n c ed i n t h e O p e n Cou r t .
Sd/- Sd/-
(SANJAY GARG) (ANNAPURNA GUPTA)
JUDICIAL MEMBER ACCOUNTANT MEMBER
Dated : 15 t h May, 2018
*Rati*
Copy to:
• The Appellant
• The Respondent
• The CIT(A)
• The CIT
• The DR
Assistant Registrar,
ITAT, Chandigarh