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2019 (11) TMI 507 - ITAT JAIPURExemption u/s 11 - discrepancy in respect of unexplained loan - assessee society is registered under section 12AA - HELD THAT:- The Ld. CIT(A) held that it is not the case of the AO that certain unsecured loans were bogus or unproved as seen from the explanation given by the appellant in assessment proceedings and also no separate addition has been made u/s 68 in respect of these loans. The exemption u/s 11 can be denied only when the assessee’s case falls in any of the limb of section 13. In the present case, assessee has not defaulted any of the limb of section 13 - denial of exemption by the AO is not justified. - Order of CIT(A) sustained. Addition on account of non deduction of TDS by holding that assessee trust was allowed the benefit of section 11 & 12 - HELD THAT:- provisions of section 40(a)(ia) are not applicable on trust. Explanation 3 to section 11 inserted by FA, 2018 which provides that provisions of section 40(a)(ia) is applicable in case of charitable or religious trust or institution is applicable from 01.04.2019. - Since assessee is eligible for exemption u/s 11, no addition can be made u/s 40(a)(ia) Addition u/s 68 - HELD THAT:- We find that the assessee has duly explained the transaction with Anil Nuhal and Krishna Developers which has been rightly appreciated by the ld CIT(A) and no infirmity therein has been observed by the ld CIT(A). We accordingly confirm the findings of the ld CIT(A) and the ground of the Revenue is dismissed. Addition on account of expenses claimed for investment in acquisition of fixed assets by holding that assessee trust was allowed benefit of section 11 & 12 - AO has denied the claim of application of income by way of capital expenditure towards acquisition of fixed assets for the reason that the assessee society was held not eligible for exemption under section 11 and 12 of the Act. However, while disposing off the aforesaid grounds of appeal, we have already held that the assessee society is eligible for exemption under section 11 and 12. Hence, the said ground of appeal becomes academic and is hereby dismissed as infructous. Accumulation or set apart to the extent of 15% by holding that assessee trust was allowed the benefit of section 11 & 12 - AO did not allow the accumulation or set apart to the extent of 15% of total receipts to the assessee as the assessee’s claim of exemption u/s 11 is rejected - HELD THAT:- . Given that besides the fees receipts and other income, the assessee has shown unsecured loans of ₹ 8,85,32,180, prima facie the excess of expenditure has been met out of unsecured loans and not out of total fee and other income receipts during the year. Therefore, it needs to be examined in detail to what extent the unsecured loans have been utilised for meeting the expenditure and to what extent, fee receipts and other income have been utilised for meeting the expenditure and then determine the amount of accumulation out of total fee and other income receipts accordingly. In the result, the matter is set-aside to the file of the Assessing officer for the limited purposes of determination the accumulation of receipts, if any and take action as per law. Appeal of the Revenue is partly allowed for statistical purposes.
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