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2019 (12) TMI 261 - ITAT DELHIAddition u/s 68 - Corpus donation received from 54 members on the ground that the assessee was unable to file any confirmation of any of the parties - CIT(A) rejected the additional evidences filed before him in shape of affidavits of all members giving corpus donation - HELD THAT:- Addition on account of advances given to six parties it is an admitted fact that the assessee had filed the copy of confirmation and the bank statement of the assessee. It was also submitted before the AO that the advances were returned back in the subsequent year. However, in absence of copy of the bank account of the relevant period, the AO did not accept the same. Before the CIT(A), the assessee had filed all the details and the CIT(A) had called for a remand report from the AO. The availability of funds with the assessee to the tune of ₹ 53 lakhs is not in dispute. It is also not the case of the Revenue that there is any misappropriation of funds since had there been any misappropriation of funds, the AO would have disallowed the claim of exemption u/s 11/12 and 12A which has not been done in the instant case. Addition made by the AO and sustained by the CIT(A) is not justified. However, since the allegation of the AO is that the assessee had not given any bank statement of the subsequent year to substantiate that the amount had been refunded back, therefore, we restore the issue to the file of the Assessing Officer with a direction to verify the bank account of the assessee of the subsequent year and once the assessee proves that the amounts were, in fact, returned by those parties in subsequent year, the Assessing Officer is directed to delete the addition. So far as the decision relied on by the ld.CIT(A) in the case of CIT vs. Shree P. Subramoniam Religious Trust [2008 (12) TMI 374 - KERALA HIGH COURT] is concerned, the same, in our opinion, is not applicable to the facts of the present case since, in that case, the Hon'ble High Court has observed that the advance is only siphoning off funds and even after a gap of 5-6 years of expiry of the assessment year when the appeal was heard before the CIT(A), it was not proved that the advances so made were utilized for the purpose for which it was advanced. In the instant case, the advances which were given for purchase of plot for construction purpose were returned back immediately in the subsequent year and, therefore, the decision relied on by the CIT(A) is distinguishable and not applicable to the facts of the present case. The ground of appeal No.2 and 3 filed by the assessee are accordingly allowed for statistical purposes. Addition being corpus donation received from the members of the society are concerned, we find the Assessing Officer disallowed the same on the ground that the assessee did not file any confirmation from the said persons. We find the ld.CIT(A) did not accept the additional evidences in the shape of affidavits filed before him and sustained the addition so made by the Assessing Officer. We find merit in the submission of the ld. counsel for the assessee that corpus donation from members cannot be treated as income of the assessee. However, the same needs to be substantiated in the shape of confirmations from the member donors of the society. We, therefore, restore this issue to the file of the Assessing Officer with a direction to grant opportunity to the assessee to file the confirmations of the said donors and, in case the assessee is able to furnish the confirmations of the donors, the Assessing Officer shall consider the allowability of the same as per law. We hold and direct accordingly.
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