TMI Blog2015 (3) TMI 191X X X X Extracts X X X X X X X X Extracts X X X X ..... was allowed by the AO in AY 2007-08, the CIT(A) did not uphold the disallowance made by the AO in AY 2008-09 on this issue. In this situation, we are in agreement with the conclusion of the CIT(A) that the AO was not justified in disallowing 2/3rd of the expenditure incurred in the remuneration of the four persons u/s 40A(ii)(b) of the Act. On this issue, we are unable to see any infirmity or perversity in the impugned order and conclusion of the CIT(A) is upheld. - Decided against revenue. Eligibility to claim of exemption u/s 11(1) - Held that:- Once the status of the appellant trust is held to be that of charitable society eligible for claim of exemption u/s 11(1)(a) of the Act, then the CIT(A) rightly directed the AO to allow the cla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Tax Act, 1961. 3) Whether on facts and circumstances of the case in law the Ld. CIT(A) has erred in treating income of ₹ 1,98,42,500/- as exempt under section 11 of the Income Tax Act, 1961 despite the assessee Trust having contravened the provisions of section 13(1)(c)(ii) read with section 13(2)(c) of the Income Tax Act, 1961. 3. Briefly stated, the facts giving rise to this appeal are that the assessee filed its return of income on 30.2.2009 declaring excess of income over expenditure amounting to ₹ 1,98,42,500/- and claiming the same as exempt income u/s 11 of the Income Tax Act. The AO completed regular assessment u/s 143(3) of the Act at a total income of ₹ 2,13,06,500/- vide order dated 23.12.2011 treat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) r/w section 13(2)(c) of the Act. 6. Ld. DR has drawn our attention towards assessment order and submitted that the ITAT in its order in assessee s own case for AY 2006-07 has observed that the salary paid to Mr. Joseph John should not exceed ₹ 20,000 per month and the amount of payment as disallowed by the authorities below was upheld by ITAT. The DR further contended that the disallowance and addition made by the AO are based on justified and cogent reasons and the CIT(A) deleted the same without any logical reasoning and grounds. 7. Replying to the above, ld. Counsel for the assessee has drawn our attention towards submissions of the assessee before the CIT(A) reproduced in the impugned order in para 5 on pages 4 to 13 of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d to same three office bearers of the appellant society to the extent of ₹ 14,64,000 /- and assessed the appellant in the status of an AOP. The appellant claimed similar salary to aforesaid three office bearers aggregating to ₹ 21 ,96,000/ - in A.Y. 2007-08 also but the AO did not make any disallowance in the assessment order passed u/s 143(3) on 30.12.2009. Keeping in view the fact that entire salary paid to the three office bearers was allowed by the AO in A.Y.2007 -08, I did not sustain the disallowance made by the AO in A.Y. 2008-09. I have also held that the AO was not justified in denying the claim of exemption u/ s 11 (1) on the ground of contravention of the provisions of section 13(1)(c) of the Act as per my appellate o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /s 40A(ii)(b) of the Act. On this issue, we are unable to see any infirmity or perversity in the impugned order and conclusion of the CIT(A) is upheld. 10. From para 6 of the impugned order as reproduced hereinabove, we also observe that the CIT(A) has followed its own order in assessee s own case dated 27.07.2011 passed in Appeal No. 278/2010-11 for AY 2008-09 which was upheld by the ITAT C Bench, New Delhi vide order dated 30.4.2012 passed in ITA No. 4514/D/2011 in assessee s own case for AY 2008-09. On perusal of above order of the Tribunal, we observe that the Tribunal has decided the issue in favour of the assessee dismissing the appeal of the revenue with following observations and findings:- 12. Let us examine whether assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evidence collected by the Assessing Officer in assessment year 2003-04. He has made reference to the salary of the staff in those years. With effect from 01.01.2006, Government of India has notified the 6th Pay Commission which resulted into a handsome enhancement in the salary of the employees including the government teaching staff and the salaries have almost enhanced by 30% to 40%. If the increase in the salary of Shri Joseph John allowed to him by the ITAT in 2004-05, is being looked into with this angle also then sum of ₹ 55,000 would not be on a higher side. Considering all these aspects and the detailed order of the Learned CIT(Appeals), we do not find any reason to interfere in it and the appeal of revenue is dismissed. 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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