TMI Blog2014 (1) TMI 240X X X X Extracts X X X X X X X X Extracts X X X X ..... urred by the assessee is also to be allowed. Non registration of the assessee society under A.P. Charitable and Hindu Religious Institutions and Endowments Act, 1987 - Held that:- The exemption u/s 11 of the Act cannot be denied to the assessee merely because the assessee is not registered under the A.P. Charitable and Hindu Religious Institutions and Endowments Act, 1987 - When there is no such restriction put u/s 11,12, and 13 of the Act or any other provision under the Act the Assessing Officer cannot deny exemption to the assessee. Grant received for repair to the houses - Held that:- The grant received from the donor agency is to be utilised for a specific purpose i.e., repair of houses of Tsunami victims in three districts - The assessee has supplied relief materials for construction of houses as well as cash distribution under certain mechanism adopted by the assessee is not disputed by the Assessing Officer - The assessee had participated in a programme of government for the benefit of Tsunami victims by providing help for construction of their houses - The Assessing Officer has not brought any material on record to show that the amount has not been actually distribut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e society incurred expenditure out of the amounts received from other agencies and the same was refunded to SIDDUR, the moment monies were received from the government. In support of such contention, the assessee also submitted two letters and copies of DD and cheques between SIDDUR and PSU (Project Support Unit) whose head office is Hindustan Latex Family Planning Promotion Trust (HLFPPT), 301-302, Hemkunt Chamber, 89, Nehru Place, New Delhi. The Assessing Officer however did not accept the contention of the assessee and treated it as income of the assessee. Further, on going through the MOU with MISEREOR (Tsunami Projects) felt that the main aim of the project was reconstruction and rehabilitation in three districts of Andhra Pradesh i.e., Nellore, Krishna and East Godavari towards Tsunami affected people. He further noted that under the MOU, the measures to be supported are mentioned as under:- i) Repairing of 800 houses of dalit and fisher families by active involvement of the target group. ii) Support of livelihood (accommodation, food and medical care) and of school attendance (materials, school uniforms, transport to school etc.,) for 200 children under the age of 14, wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... est of the poor and the distribution of materials to the beneficiaries is the commitment of the assessee and not mere distribution of cash. The Assessing Officer therefore felt that the assessee having not utilised the tied up of grant for the purpose for which it was given, is not entitled for exemption. The Assessing Officer referred to an order passed by the ITAT dated 27-12-2008 for assessment year 1997-98 wherein the Tribunal held that the contributions received for specific purposes do not form corpus of the assessee and its income and the same is in the nature of tied up grants. Since according to the Assessing Officer the assessee has utilised the tied up grant according to its own discretion, the assessee is not entitled for exemption on the amount of Rs.50,65,125/- towards repairs to houses destroyed by Tsunami and Rs.12,69,821 towards support to women. The Assessing Officer further opined that the assessee having not been registered u/s 43(1) of AP Charitable and Hindu Endowment Act, 1987 it is not entitled for exemption u/s 11(1) of the Act. Accordingly the Assessing Officer completed the assessment by determining the total income at Rs.76,58,100/-Being aggrieved of suc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ffect that the assessee has not utilised the fund for the public i.e., housing for victims of Tsunami 2004 and hence cannot be held to have done charitable activity, by observing that the Indiramma Housing Programme has indeed been introduced by the Government to assist the poorest of the poor and can even encompass the victims of the Tsunami. That besides such collaborative efforts had indeed been approved by the donor agencies. The CIT (A) further observed that the Assessing Officer's objection with regard to the fact that the assessee did not solicit the requisite three quotations for purchases, is also not a very vital point to deny exemption to the assessee since all the purchases were made with due approval of donors. The CIT (A) finally held that the Assessing Officer was not correct in making addition of the amounts spent by the assessee towards repair of house and support to women. So far as the expenditure incurred towards international seminars/conferences amounting to Rs.2,90,154/- is concerned, the CIT (A) also did not agree with the Assessing Officer by observing that the assessee receives grants from various donors for various charitable purposes and it is only logic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1(1)(c) of the Act as it is not supported by special or general order of CBDT. In our view, the disallowance of expenditure on such plea is totally contrary to the statutory provisions. It is neither necessary nor required as per the statute that for availing exemption u/s 11 of the Act a particular charitable activity has to be notified in a circular issued by the CBDT. As has been rightly held by the CIT (A), the expenditure was incurred on behalf of the Society for attending international conferences and seminars and for the purpose of advancing the objects of the Society. It is not for the personal benefit of the Secretary, therefore it cannot be said that the expenditure incurred in that behalf is not for charitable purpose. On the aforesaid view of the matter, we do not find any infirmity in the order of the CIT (A) on this issue. Accordingly, the ground raised by the department is dismissed. 12. The next issue as raised in ground No.2 is with regard to the CIT (A) deleting the addition of Rs.10,33,000/- being refund of loan. It is the contention of the learned Departmental Representative before us that in the certificate issued by Hindustan Latex Family Planning Promotion ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dition and there is no cause to interfere with the findings of the CIT (A) on this issue. 14. The learned DR, on the other hand, strongly supporting the view of the Assessing Officer submitted that since in the certificates of HLFPPT, the amount has been mentioned as grant and the Assessing Officer was justified in making the said addition. 15. Having heard the submissions of the parties and perused the materials on record, we do not find any infirmity in the order of the CIT (A). As can be seen from the observations made by the Assessing Officer, he has not disputed the fact that the assessee has incurred the expenditure towards implementation of the project relating to Prevention and Control of HIV/AIDS. It is also not disputed that the project is a Government promoted project and the grant has been specifically for implementing the said project. In the aforesaid circumstances, the conclusion arrived at by the Assessing Officer cannot be accepted, even otherwise also if at all the amount received is to be considered as a grant, then corresponding expenditure incurred by the assessee is also to be allowed. In aforesaid view of the matter, we do not find any reason to interfere ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t during the year under dispute, the assessee received the amounts from the donor agency for disbursement to the flood victims in Nellore, Guntur and twin districts of Godavari on account of Tsunami for the purposes of construction/re-construction/repairs of the houses affected by the floods. The assessee has taken all necessary steps to identify the victims by seeking assistance of village elders, village officers, district officials and only then disbursed these amounts to the affected victims. It was submitted by the learned AR that the amounts disbursed were uniform amount which was the maximum amount allowed by the donor agency and this was also based on the requirement of the affected persons which also included the amounts given for support to women. The learned AR referring to auditor's report appearing at pages 15 and 16 of the paper book submitted that all the accounts of the assessee are audited and each and every expenditure is accounted for. The learned AR referring to the reply submitted before the Assessing Officer during the assessment proceedings submitted that all the details with regard to quotations obtained from different suppliers were submitted during assessm ..... X X X X Extracts X X X X X X X X Extracts X X X X
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