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2014 (1) TMI 1944 - ITAT AMRITSARDenial of exemption u/s 10(23C)(iiiab) - assessee has neither sought nor was granted any registration u/s 12AA for which the assessee is claiming the exemption in dispute - HELD THAT:- As in a matter of fact and record that the assessee derives income from running an educational institute in the name and style of the Malout Institute of Management and Information Technology at Malout which was established by Government of Punjab as per Memorandum of Association and Rules and under the Societies Registration Act, 1860 as amended by Punjab Amendment Act, 1947, vide No. 643 of 1998-99 dated 11.08.1998. As assessee has claimed its income as applied towards charitable purpose as per Section 11(1)(a) of the Act. At the same time, the assessee has claimed its balance income as exempt under Section 10(23C)(iiiab). It is obvious that a question had arisen in the mind of the AO that how the assessee is claiming under two provisions of the Act i.e. Section 11(1)(a) and Section 10(23C)(iiiab) - AO asked the assessee to justify its claim and in response to the same, the assessee stated that its institute is approved as 100% Govt. Autonomous Body and the Government has not financed any paisa to the institute in last 5 years because the institute is already having a good amount lying in Fixed Deposits with Banks. This very reply of the assessee is against the assessee which is contrary to the provisions of Section 10(23C)(iiiab). According to the provision of Section 10(23C)(iiiab) one can only get exemption, if it fulfills the conditions of this Section. It is very much necessary for the assessee to fulfill all the conditions for exemption u/s 10(23C)(iiiab). In our considered view the assessee did not fulfill the required conditions as mentioned u/s 10(23C)(iiiab) of the Act and the FAA has wrongly deleted the additions in dispute without any basis as well without going through the relevant provisions of law. Assessee itself admitted before the AO in its reply which we have reproduced above that the institute is approved as the 100% Govt. Autonomous Body and the Government has not financed any paisa to the institute in the last 5 years because the institute is already having a good amount lying in Fixed Deposits with Banks. We are of the view that the assessee is also not fulfilling the conditions regarding the Institute must be wholly or substantially financed by the Government. FAA has deleted the addition in dispute contrary to the law and facts and on the file and without going through the provisions of law as well as documentary evidence establishing that the assessee is entitled for the exemption claimed under Section 12(23C)(iiiab) or Section 11 and 12 of the Act. Principle of res-judicata - As regards to the deletion of addition in dispute on the basis that the same exemption has been allowed by the Revenue Authority in the earlier year and the learned First Appellate Authority has granted the same in the year in dispute also, we are of the view that every assessment year is an independent assessment year. In the income tax proceeding, there can be no question of res-judicata. The decision given by one Assessing Officer for one assessment year cannot affect or bind his decision for another year. This view is supported by various judgments rendered by Hon'ble Supreme Court of India, which includes in the case of New Jehangir Vakil Mills Co. Ltd. [1963 (4) TMI 60 - SUPREME COURT]. Assessee has not produced any documentary evidence before the Assessing Officer, learned CIT(A) and even before us, proving that the assessee has got approval from the prescribed authority for the exemption under Section 10(23C)(iiiab) of the Act. Exemption claimed u/s 11(1)(a) - as mentioned in the computation of income regarding, its income applied towards charitable purpose and hence deducted 15% of its receipts deeming the same as to have been applied as per Sections 11(1)(a) of the Act. For claiming the exemption, u/s 11(1)(a) of the Act, the assessee required registration u/s 12AA of the Act. The same has also not been produced by the assessee before any authorities below and even not before us. Therefore, the assessee is not entitled for any exemption under Section 11(1)(a) of the Act. Keeping in view the income and expenditure account as well as the fee structure of the assessee, we are of the view that the assessee is not charitable institution and it is doing business for profit and the assessee-institute has been accumulating funds year after year, which are parked with the banks in the form of FDRs, as is evident from its balance sheet as on 31.03.2009, total FDRs with the bank are of Rs. 11,27,93,116/-. Therefore, the assessee has not received any penny from the Government for the last 5 years as admitted by the assessee. Keeping in view the aforesaid discussion, we are of the view that learned First Appellate Authority has wrongly allowed the exemption to the assessee without applying its mind to the relevant provision of law as well as lack of documentary evidence, which are required for granting exemption in dispute. Appeal filed Revenue is allowed.
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