9911796707
TMI Blog2012 (10) TMI 255X X X X Extracts X X X X X X X X Extracts X X X X ..... f facts. Therefore, for the sake of convenience, all these appeals are decided by this common order. 3. Two appeals pertain to merit of the case and two appeals pertain to levy of penalty under section 271(1)(c) of the Income Tax Act, 1961 ('the Act' hereinafter). Since common grounds have been raised by the Revenue in both the appeals, therefore, for the sake of convenience, the grounds raised for A.Y. 1997- 98 are reproduced as below :- Grounds of ITA No.221/Agr/2011 for A.Y. 1997-98:- "1. The Ld. CIT (Appeals) has erred in law and on facts deleting the penalty u/s 271(1)(c) amounting to Rs.55,00,000/- allowing exemption u/s 10(22) of the IT Act, 1961 to the assessee. 2. Appellant craves leave to amend, alter, add or modify any ground ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... see was also granted registration under section 12A of the Act w.e.f. 01.04.2004. The issue before the CIT(A) were of four folds which reads as under :- (Page no.20) i) One is whether the appellant is entitled for exemption under section 10(22) of the I.T. Act, 1961. ii) The other one is find the effect and fate of addition made in the hand on protective basis and made on substantive basis in the hand of Shri S. Anwar Saeed. iii) Remaining question is with regard to two other additions i.e. capital expenditure debited to income & expenditure account and disallowance made by resorting to section 40A(3) of the Act. iv) Other issues like charging of interest under different section of the Act." 5. The CIT(A) decided the first issue in fav ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hese documentary evidences lend credence to the appellant's claim that it was 'existing' for education purposes. The objection of the AO in so far as 'non filing of return inspite of having receipts of over Rs.1 crore' is not tenable for the reason that section 10(22) of the Act, as it stood at the relevant time did not provide for any such cap on total receipts. It was only after the amendment brought by Finance (No.2) Act, 1998 that this section was amended w.e.f. 01.04.1999 i.e., assessment year 1999-2000 and cap on total receipt was placed. Hon'ble Supreme Court in the case of 301 ITR 86 has clearly mentioned that section 11 to 13 had no application in the matter of exemption under section 10(22) of the 'Act'! The case laws of St. Mic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... profit. Thus, this consideration of misappropriation of funds or utilization of facilities for personal gains by any employee, to hold the institution itself as 'existing for profit' would not be correct. The institution (i.e., the appellant) and its registrar are two separate and distinct entities. While the Registrar is paid employee on regular rolls of the institute, who has later been removed and various criminal proceedings and other actions were taken against him may have profit motive, but his motive cannot be imported as the motive of the institution. No other case has been made out by AO to hold the appellant as 'existing for profits'. I have also gone through the decisions cited by learned AR reproduced in earlier part of this o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f Shri S. Anwar Saeed on substantive basis, the disallowance made on protective basis cannot be sustained. Similar finding was given by the CIT(A) in respect of disallowance under section 40A(3) observing that when assessee is eligible for exemption under section 10(22) of the Act, the disallowance under section 40A(3) becomes academic. 7. We have heard the ld. Representatives of the parties and records perused. The ld. Departmental Reprehensive did not dispute regarding the facts of the case. The admitted facts of the case are that the assessee is an Educational Institute and its income are exempt under section 10(22) of the Act. We noticed that the CIT(A) has rightly allowed the assessee's claim after a detailed discussion that the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessee is an Educational Institution. Apart from above facts, we notice that the CIT(A) has decided the issue after a detailed discussion on each and every issue. The Revenue has failed to point out how the assessment made under section 144 of the Act was in favour of the Revenue particularly when the CIT(A) has considered each and every issue and aspect of the A.O. The CIT(A) has co-terminus power of the A.O. and from the detailed discussion in the CIT(A)'s order, we do not find any substance in this ground of the appeal of the Revenue and, therefore, the same is dismissed. 10. Ground no.3 is general in nature requires no independent finding. 11. The Revenue has failed to point out any contrary material or evidence nor the same are avai ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
