TMI Blog2012 (11) TMI 100X X X X Extracts X X X X X X X X Extracts X X X X ..... le activity are also carried out for the benefit of religious community, or caste, clause (b) would have no application in such a case - CIT(A) has confined the exemption excluding the proportionate consultancy charges to the actual cost of the temple - no dispute that surrounding area of the temple is being used by students of all the community and caste for their activities like meditation, yoga lessons, jogging, physical exercise etc - Decided in favor of assessee. Addition on account of retention money - assessee submitted that retention money was the deduction from the interim payment made to a contractor during the pursuance of the contract - amount was deducted as a security for rectification of all the defects pointed out in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erein taxable income has been shown as nil. 4. The Ld. D.R. on the other hand opposed the above objection on the basis that the relief given by the first appellate authority is having more than the tax effect of Rs. 2,00,000/- or 3,00,000/-, hence preference of present appeal cannot be termed as in violation of the CBDT Instructions r.w.s. 268A of the Act. 5. Considering the above submission, we find substance in the opposition of Ld. D.R. that in the present appeal, the relief given by the Ld CIT(A) to the assessee Society has been questioned, tax effect of which more than 2,00,000/- or Rs. 3,00,000/-, hence the present appeal cannot be held preferred in violation of the CBDT Instruction r.w.s. 268 of the Act. The preliminary objection ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bers of students are availing hostel. Ganesh temple is in the campus. It was constructed for betterment of life, hence was meant for a charitable purpose. He submitted that students are coming from all the community and religion , charitable purpose also includes religious purpose. He placed reliance on the following decisions : 1) 88 ITR 354 (Guj.) (upheld by Hon ble Supreme Court in 140 ITR 1 (S.C.) CIT, Gujarat I Vs. Ahmedabad Rana Custe Association. 2) The Society of Presentation Sisters Vs. ITO, 121 ITD 421 (TM) 9. The Ld. A.R. submitted further that the dominant purpose of the assessee society has to be seen while examining as to whether it is being run for charitable purposes. In support he placed reliance on the following d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... being actually used by the students for their activities like meditation, yoga lessons, jogging, physical exercises etc. Before the Ld CIT(A), the assessee submitted further that the actual cost of temple alone is hardly around 12 lacs. The Ld CIT(A) has accordingly directed the A.O to verify the actual cost of the temple, work out proportionate disallowance out of Consultancy charges and restrict the disallowance to that extent only. We do not find infirmity in the first appellate order on the issue as it is comprehensive and reasoned one. The Ld CIT(A) has also placed reliance on the decision of Tribunal in the case of Society of Presenttion Sisters Vs. ITO, 121 ITD 422 (Cochin) (TM ) wherein it has been held that it is well settled that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is upheld. The grounds 1 to 4 involving the issue are thus rejected. 11. Issue no. 2 is relating to the addition of Rs.70,97,365/- made on account of retention money. The A.O noticed that the assessee had to pay earnest money to Nyati Engineering and Consultant at Rs. 7,00,000/- and retention money payable to different parties of Rs. 63,97,365/-. She was of the view that as this amount was not paid, hence this should have been reflected in un-utillized fund for building construction fund. The assessee submitted that retention money was the deduction from the interim payment made to a contractor during the pursuance of the contract. The amount was deducted as a security for rectification of all the defects pointed out in the course of co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it. 12. Before the Tribunal, the Ld. D.R. has basically placed reliance on the assessment order. The Ld. A.R. on the other hand has tried to justify the first appellate order. 13. Considering the above submission, we find that there is no dispute that the contractors have not raised bills for double amount but have raised the bills only for the amount payable after deduction of the retention money. Thus, the Ld CIT(A) has rightly held that the assessee has accepted the bill as such is sufficient to prove that income equivalent to the amount shown in the bill raised by the contractor and accepted by the assessee has been applied for the objects of the Trust. We also concur with the view of the Ld CIT(A) that the terms of payment relatin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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