Income Tax Appellate Tribunal - Bangalore
Deputy Commissioner Of Income Tax, ... vs M/S. St. Joseph'S Monastery, , ... on 27 June, 2018
IN THE INCOME TAX APPELLATE TRIBUNAL
BANGALORE BENCH ' C '
BEFORE SHRI N.V. VASUDEVAN, JUDICIAL MEMBER AND
SHRI JASON P BOAZ, ACCOUNTANT MEMBER
I.T. A. No.2893/Bang/2017
(Assessment Year : 2013-14)
Dy. Commissioner of Income Tax (Exemptions),
Circle 1, Bangalore. .... Appellant.
Vs.
M/s. St. Joseph's Monastery,
No.39, St. Joseph's Monastery House,
Gunjur Carmelaram Road, Bangalore-560 035. ..... Respondent.
Appellant By : Shri Sanjay Kumar, CIT (D.R)
Respondent By : Shri V. Srinivasan, Advocate.
Date of Hearing : 03.05.2018.
Date of Pronouncement : 27.06.2018.
O R D E R
Per Shri Jason P Boaz, A.M. :
This appeal by the Revenue is directed against the order of Commissioner of Income Tax (Appeals)-4, Bangalore dt.03.10.2017 for the Assessment Year 2013-14.
2. Briefly stated, the facts relevant for disposal of this appeal are as under :-
2ITA No.2893/Bang/2017
2.1 The assessee, a religious and charitable society registered under Section 12A of the Income Tax Act, 1961 (in short 'the Act') vide order No.Trust 718/10A/Vol.A II/J-1974 dt.1.3.1983, filed its return of income for Assessment Year 2013-14 on 30.3.2015 declaring NIL income, after claiming exemption under Section 11 of the Act. The case was taken up for scrutiny and the assessment was concluded under Section 143(3) of the Act vide order dt.29.3.2016, wherein the taxable income was determined at Rs.27,66,73,445, in view of the denial of exemption under Section 11 of the Act.
2.2 Aggrieved by the order of assessment dt.29.3.2016 for Assessment Year 2013-14, the assessee preferred an appeal before the CIT (Appeals) - 4, Bangalore. The learned CIT (Appeals) disposed off the assessee's appeal vide the impugned order dt.3.10.2017, allowing the assessee partial relief. In doing so, the learned CIT (Appeals), following the decision of a co-ordinate bench of this Tribunal in the case of Al Ameen Educational Society Vs. DIT (Exemptions) (2012) 26 taxmann.com 250 (Bang) held that donations made from the sale proceeds of the capital asset is also application of income towards the objects of the Trust and therefore, the assessee is eligible for exemption under Section 3 ITA No.2893/Bang/2017 11 of the Act. The learned CIT (Appeals) also held that the Assessing Officer's view, that unless investment is made in another capital asset, exemption under Section 11 of the Act cannot be allowed; is not a correct view.
3.1 Revenue, being aggrieved by the decision of the learned CIT (Appeals) - 4, Bangalore dt.3.10.2017 for Assessment Year 2013-14, has filed this appeal before the Tribunal, wherein it has raised the following grounds :-
4ITA No.2893/Bang/2017
3.2.1 We have heard the rival contentions, perused and carefully considered the material on record; including the judicial pronouncement cited. The issue for consideration before us, is whether donations for charitable purposes made from sale proceeds of the capital asset is also application of income towards achievement of the objects of the Trust and render it eligible for exemption under Section 11 of the Act. We find that the issue before us, is squarely covered in favour of the assessee by the decision of a co-ordinate bench of this Tribunal in the case of Al Ameen Educational Society Vs. DIT (Exemptions) (supra) wherein the Bench at paras 16.1, 17.1 and 21 held that if the capital gains / sale proceeds of the capital asset is applied for charitable purposes in keeping with the objects of the assessee trust, not by acquiring a new asset but for other charitable purposes, then there is no reason why it should not be considered as application of income for charitable purpose, thereby enabling the assessee to be eligible for claiming exemption under Section 11 of the Act.
3.2.2 Following the aforesaid decision of the co-ordinate bench of this Tribunal in the case of Al Ameen Educational Society Vs. DIT (Exemptions) (supra), we uphold the decision of the learned CIT 5 ITA No.2893/Bang/2017 (Appeals), rendered at para 12 of the impugned order, that donations made form sale proceeds of the capital asset for charitable purpose in furtherance of the objects of the assessee trust, renders the assessee eligible for exemption under Section 11 of the Act. Consequently, the grounds raised by Revenue are dismissed.
4. In the result, Revenue's appeal for Assessment Year 2013-14 is dismissed.
Order pronounced in the open court on the 27th day of June, 2018.
Sd/- Sd/-
(N.V. VASUDEVAN) (JASON P BOAZ)
Judicial Member Accountant Member
Bangalore,
Dt. 27.06.2018.
*Reddy gp
Copy to :
1 Appellant 4 CIT(A)
2 Respondent 5 DR. ITAT, Bangalore
3 CIT 6 Guard File
Senior Private Secretary
Income Tax Appellate Tribunal
Bangalore.