Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2020 (3) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2020 (3) TMI 543 - AT - Income TaxExemption of income u/s 11 and 12 - assessee is a Hindu religious charitable institution and carrying on the charitable activities - HELD THAT:- In the instant case, the trust is very old trust and as observed from the trust deed, it is carrying on the same objects prior to the date of trust deed also. The AO did not make out a case that the assessee is not carrying on the same objects prior to trust deed dt.28.04.2016. Therefore, we are of the view that the assessee’s case is squarely covered by the decision of Ganta Sriram Educational Society [2017 (11) TMI 365 - ITAT VISAKHAPATNAM] accordingly we hold that income of the assessee is entitled for exemption u/s 11 and 12 of the Act. Hence, we set aside the order of the Ld.CIT(A) and allow the appeal of the assessee on this ground. Rejection of assessee’s claim u/s 11(1A) - assessee has made the investment in fixed deposits for more than 6 months in the same financial year - HELD THAT:- In the instant case, the assessee sold the property for a consideration of ₹ 40,99,200/- and invested in fixed deposits of ₹ 41,04,400/- as per the copies of evidences placed before us. The deposits were made in the same financial year, but not in the subsequent assessment year as stated by the Ld.AO. Deposit of ₹ 25,00,000/- was made in Andhra Bank on 03.03.2010 and ₹ 16,04,400/- on 09.03.2010. The Board has clarified in Instruction No.883 dt.24.09.1975 that investment of the net consideration of fixed deposit with a bank for a period of six months and above would be regarded as utilized for acquiring another capital asset within the meaning of section 11(1A) - Since the assessee has made the investment in fixed deposits for more than 6 months in the same financial year, we hold that the assessee is entitled for exemption of sale consideration u/s 11(1A) of the Act and the same required to be considered as for acquiring another capital asset. Accordingly, the orders of the lower authorities are set aside and the appeal of the assessee on this issue is allowed. Application of 50C for sale consideration of the immovable property - HELD THAT:- In the instant case, the assessee has sold the property consisting of 3 plots for sale consideration of ₹ 40,99,200/- and the market value of which was ₹ 67,41,740/-. In the earlier paragraphs, we have decided that the assessee’s income is entitled for exemption u/s 11 and 12 of the Act. Having decided that the assessee’s income is exempt u/s 11 and 12 of the Act, the assessee’s income required to be computed as provided in section 11 to 13 of the Act, but not under other provisions of the Act. Therefore, we agree with the contention of the Ld.AR that when the income has to be computed u/s 11 to 13, application of section 50C has no relevance. Since the assessee has invested the entire sale consideration of ₹ 40.99 lakhs in fixed deposits, the assessee is entitled to claim exemption u/s 11 of the Act, thus, we set aside the order of the Ld.CIT(A) and delete the addition made by the AO u/s 50C. Corpus donation received by the assessee is exempt u/s 11(1)(d) Addition u/s 69C - Unexplained expenditure -- HELD THAT:- The proviso to section 69C is invoked in a situation where the assessee incurs expenditure and offers no explanation about the source of such expenditure. In the instant case, the AO has not doubted the source of expenditure and he simply made the addition, for not offering the cross verification of the genuineness of the transaction. From the order of the AO, it is clear that the amount was paid by cheque to Mr.P.N.Roy and the expenditure was incurred by Sri Sidheswarananda Bharathi Swamy which was reimbursed by the mutt. The source and the genuineness of expenditure was explained by the assessee. Therefore, we find no reason to make addition and hence, we set aside the order of the Ld.CIT(A) and allow the appeal of the assessee.
|