Income Tax Appellate Tribunal - Chandigarh
Dcit, C-2, Chandigarh vs M/S H.H. Dalai Lama Central Tibetan ... on 30 May, 2019
आयकर अपील य अ धकरण,च डीगढ़ यायपीठ, "ए" च डीगढ़
I N TH E I NC O ME T A X A P PE L L A T E T R I B U N AL
D I VI S I O N BE NC H , ' A ' , CH A N D I G AR H
ी संजय गग , या यक सद य एवं डा. बी.आर.आर, कुमार, लेखा सद य
B E F OR E S HR I S A N J A Y GA R G, J U D I C I A L M E M B E R A N D
D R . B . R . R . KU M A R , AC C OU N T AN T M E M B E R
आयकर अपील सं./ ITA No. 1 5 4 1 / C H D / 2 0 1 7
नधा रण वष / Assessment Year : 2010-11
The DCIT, Circle 2 (Exemptions) बनाम M/s H.H. Dalai Lama Central Tibetan
Chandigarh Relief Committee,
Dharmshala H.P.
थायी लेखा सं./PAN NO: AAATH0700J
अपीलाथ /Appellant यथ /Respondent
नधा रती क ओर से/Assessee by : Sh. Sanjeev Singh, Advocate
राज व क ओर से/ Revenue by : Sh. Ashish Gupta, CIT DR
सन
ु वाई क तार%ख/Date of Hearing : 06.05.2019
उदघोषणा क तार%ख/Date of Pronouncement : 30.05.2019
आदे श/Order
Per Sanjay Garg, Judicial Member:
The present appeal has been preferred by the Revenue against the order dated 31.08.2017 of the Commissioner of Income Tax(Appeals), Palampur [hereinafter referred to as 'CIT(A)'].
2. In this appeal, the Revenue has agitated the action of the CIT(A) in deleting the addition made by the Assessing officer of ₹ 6,79,11,022/- in the assessment ITA No. 1541/Chd/2017- H.H.D Dalai Lama Central Tibetan Relief Committee, Dharmshala 2 carried out u/s 143(3) read with section 147 of the Income-tax Act, 1961 (in short 'the Act') on the ground that the assessee had not given specific purpose for which the aforesaid amount was accumulated u/s 11(2) of the Act.
3. The assessee is a charitable organization registered u/s 12 / 12A of the Income Tax Act. The assessee, therefore, claimed exemption u/s 11 of the Act in respect of income earned during the year. The assessment was accordingly completed by the Assessing officer u/s 143(3) of the Act on 21.1.2013 at 'nil' income. However, subsequently the Assessing officer noticed from the record that the purpose o f accumulation was shown as "Relief program, Rural development, Environment program. Vocational training program. Misc. income granting program. Agriculture activities, Animal husbandry program and Running expenses". The Assessing officer held that benefit of accumulation was sought for objects / purposes which were not specific and the purposes of accumulation narrated were simply the aims and objects of the trust. He held that there should be specific purposes for accumulation. That mere repetition of the objects of the trust would not meet the r e q u i r e m e n t o f s e c t i o n 1 1 ( 2 ) o f t h e A c t . He, accordingly reopened the assessment invoking the provisions of section 147 / 148 of the Act and denied the benefit of accumulation u/s 11(2) of the Act to the assessee and assessed the income of the assessee at ₹ 6,73,13,022/-.
ITA No. 1541/Chd/2017-
H.H.D Dalai Lama Central Tibetan Relief Committee, Dharmshala 3
4. Being aggrieved by the above order of the Assessing officer, the assessee preferred appeal before the Ld. CIT(A).
5. The Ld. CIT(A) after considering the submissions of the assessee deleted the addition so made by the Assessing officer observing as under:-
" I have considered the facts of the case and written submission of the appellant. Original assessment u/s 143(3) was made at nil income by ITO, Dharamshala. Subsequently, the assessment was re-opened u/s 147 / 148 by recording reasons to the effect that the notice of accumulation u/s 11(2) of the Act given by the appellant was not specific, i.e., no specific purposes for which the accumulation was made were mentioned and only the general objects of the trust had been reiterated in the said notice u/s 11 (2) of the Act.
During appeal, the appellant filed copy of the original assessment order u/s 143(3) dated24.01.2013 and argued with reference to para-3 of the assessment order that Ld. A.O. had called for and examined the details / documents in respect of the Receipts during the year, the expenditure made towards charitable purposes, the balance amount set apart during the earlier years and the amounts accumulated being spent in succeeding years etc. As mentioned in para-4 of the original assessment order u/s 143(3), the assessee duly submitted accumulation chart of the last five years alongwith Form No. 10. The returned income was accepted only after Ld. A.O. was satisfied with the above details. Hence, there was no valid ground for initiating proceedings u/s 148 of the Act when the assessment proceedings u/s 143(3) stood duly completed. No new information had come into the possession of Ld. A.O. on the basis of which proceedings u/s 147 / 148 could have been initiated. Having completed the original assessment under section 143(3) after due verification of the accumulation made under section 1 1(2) of the Act, Ld. AO was not justified to reopen the completed assessment on the ground that the notice for accumulation did not mention any specific purposes.
I have considered the above facts of the case. A perusal of Form No- 10 dated 27.09.2010, a copy of which was furnished during appeal, ITA No. 1541/Chd/2017- H.H.D Dalai Lama Central Tibetan Relief Committee, Dharmshala 4 shows that the accumulation of Rs. 6,78,50,000/- has been made for the following purposes :
Relief program, Rural development, Environmental program, Vocational training program, Micro income generating program, Agricultural activities. Animal husbandry program and Running expenses.
It is seen that Schedule-1 annexed with the return of income duly gives details of amounts accumulated / set apart within the meaning of section 11(2) in the last 11 years under the same very heads. The amounts applied out of the above during different years have also been specifically mentioned. The above heads mentioned in the notice of accumulation are not general heads but specific heads under which Funds pending utilization are shown and Foreign contributions are being specifically reported under the FCRA (Foreign Contribution Regulation Act) by the appellant. The detailed breakup of Rs. 6,78,50,000/- mentioned in the notice of accumulation u/s 1 1(2) of the Act is as under:-
Particulars Opening balance Receipt during Utilized during Closing balance Total Set
the vear the vear receipt apart
Ledger Head FC Local FC Local FC Local FC Local
Account Account Account Account Account Account Account Account
Encashment • 720629. - 120750 - 620,750 - 220629. 50 120,750
50
Housing 2593408. 15000. 2578408.
Renovation & 85 00 85
Construction
Program
Micro Income 26684628. 183916. 16098581 1748717 2529603 183916.74 1609858 157345
Generating 24 74 .54 1.12 8.66 1.54 89.86
Program
Old People 4973554. 297402. 1686450. 297402.
Allowance 14 00 00 3584506.14 00
Other 10175644. 5037624. 11907407 22835.85 1188295 I020009 5060460.57 1193024 489617
Miscellaneous 04 72 .00 9.60 1.44 2.85 9.05
Private Office 9191792.21 1099847. 8674629. 1431600. 6514067 1417200. 1135235 1114247.50 1010622
Grant for Poor £ 50 40 00 80 00 3.81 9.40
Elderly People
(cons OPH)
Relief Program 3221199.34 176851. 14760273 62982.00 1001711 49811.00 7964353- 190022.08 1482325 692131.
08 .62 9.00 96 5.62 29
Agriculture 12367116. 38091701 3688763 1357117 3809170 125216
Activities 46 . .19 9.26 8.39 1.19 59.89
Office and Staff 7459984. 78.000. 7381984.00 7459984.
QU Construction 00 00 00
Animal 9367273.25 1116%80 1361098 6925964. 1116968 247119 Husbandry .80 9.48 57 0.80 4.18 Program ITA No. 1541/Chd/2017- H.H.D Dalai Lama Central Tibetan Relief Committee, Dharmshala 5 Environmental 3305668.20 4140160. 3379591. 4066237. 4140160. 398377 Program 29 22 27 29 2.27 Grant of 8240032.10 34119810 28112074 1433910 3411981 Stipend/scholars .26 0.34 2.02 0.26 hip/assistance Rural 50332270. 44611121 3214815 6279523 4461112 193237 Development 05 .00 9.28 1.77 1.00 16.53 Vocations 1 7.482521.00 9475065. 7402756. 9554830. 9475065. 822675 Training (Youth 10 00 10 10 6.93 Empowerment Support! Grand Total 140368144. 1478583 19304843 9395553. 1673511 3 867 2 1 1 1660653 20314175. 2024439 678500 .89 2.53 0.20 85 93.10 .00 81. 99 38 84.05 00.00 Since the donors had given funds for specific objects, the funds remaining unutilized to the tune of Rs. 6,78.50,.000/- were accumulated u/s 11(2) under specific heads as mentioned in the appellant's written submission above.
In view of the above facts, it is held that Ld. A.O. was not justified to hold that the notice of accumulation u/s 11(2) has not been given for specific objectives / purposes and to not give credit for the same. The amount accumulated as above has been utilized in the succeeding assessment years under the same heads as under :
A.Y. 2011-12 Rs. 3,7,50,000/-
A.Y. 2012-13 Rs. 3,21,00,000/-
Since all the above details were already available in the ITR / audited accounts/ replies of the appellant filed during the original assessment proceedings and had been duly examined as mentioned in paras 3 & 4 of the original assessment order, initiation of proceedings u/s 147/ 148 was not justified. Grounds of appeal 1 & 2 are allowed."
6. We have considered the rival contentions and have also gone through the record. A perusal of the above reproduced findings of the CIT(A) reveals that the Ld. CIT(A) has given categorical finding that the detailed break up of ₹ 6,78,50,000/- mentioned in the notice of accumulation u/s 11(2) of the Act were duly furnished before the Assessing officer which have been reproduced also in the impugned order in the shape of chart as reproduced above. There was no fresh ITA No. 1541/Chd/2017- H.H.D Dalai Lama Central Tibetan Relief Committee, Dharmshala 6 information to the Assessing officer that the income of the assessee has escaped assessment. The Assessing officer has formed the opinion regarding the escapement of income after re-appreciation of the facts on record which was nothing but just change of opinion. Moreover, the amount so accumulated has been spent in the subsequent years which have also been accepted in the assessment proceedings of the subsequent years. In view of this, it cannot be said that the income of the assessee had escaped assessment. We therefore, do not find any infirmity in the order of the Ld. CIT(A) and the same is upheld.
There is no merit in the appeal of the Revenue and the same is accordingly dismissed.
Order pronounced in the Open Court on 30.05.2019 Sd/-
Sd/- (संजय गग / SANJAY GARG )
( बी,आर.आर. कुमार / B.R.R. KUMAR) या यक सद य /Judicial Member
लेखा सद य/ Accountant Member
Dated : 30. 05.2019
"आर.के."
आदे श क त,ल-प अ.े-षत/ Copy of the order forwarded to :
1. अपीलाथ / The Appellant
2. यथ / The Respondent
3. आयकर आयु/त/ CIT
4. आयकर आयु/त (अपील)/ The CIT(A)
5. -वभागीय त न2ध, आयकर अपील%य आ2धकरण, च4डीगढ़/ DR, ITAT, CHANDIGARH
6. गाड फाईल/ Guard File आदे शानस ु ार/ By order, सहायक पंजीकार/ Assistant Registrar