TMI Blog2016 (1) TMI 1118X X X X Extracts X X X X X X X X Extracts X X X X ..... pli [2010 (7) TMI 374 - Punjab and Haryana High Court] - Decided in favour of assessee. - ITA No. 686/Bang/2015 - - - Dated:- 8-1-2016 - SHRI N.V. VASUDEVAN, JUDICIAL MEMBER AND SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER For The Appellant : Shri C.Ramesh, CA For The Respondent : Shri G.Ramesha, JCIT ORDER Per N.V. Vasudevan, Judicial Member: This appeal by the assessee is against the order dated 25.3.2015 of CIT(Appeals), LTU, Bangalore, relating to AY 2009-10. 2. Ground No.1 raised by the Assessee is general in nature and calls for no specific adjudication. Ground No.2 3 raised by the Assessee reads as follows:- 2. The learned Commissioner of Income Tax (Appeals) erred in confirming disallowance of expenditure of ₹ 5,04,766/- as having been incurred in foreign currency and hence, cannot be considered as applied for charitable purposes in India. 3. The learned Commissioner of Income Tax (Appeals) erred in confirming the disallowance of expenditure of ₹ 5,04,766/- with a finding that, the payment is to relatives as envisaged U/s.13(3) of the act ignoring the fact that, the Assessing Officer has not given any such findings in the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... incurring of the aforesaid expenditure and also documentary evidence of the manner in which her services were utilized during the previous year. The request of Ms.Trishtha for sponsoring her studies abroad and the resolution of the trust authorizing incurring of the expenditure were filed before CIT(A). The CIT(A) noticed that the resolution of the trust authorizing incurring of the expenditure was conditional on Ms.Trishtha giving an undertaking that she will return to India. The CIT(A) noticed no such undertaking had been given by Ms.Trishtha. The Assessee claimed before CIT(A) that Ms.Trishtha returned to India after completing studies on 15.6.2008 and worked for the Assessee trust. The Assessee gave details of services rendered by Ms.Trishtha to the Assessee trust. The same are set out in para 3.2 of CIT(A) s order. 7. The CIT(A) did not agree with the above submissions of the Assessee. She held that as per the deed of trust one of the objectives of the trust was to grant financial assistance to poor and to grant financial assistance to educated persons from amongst the poor to establish self-employment schemes. According to CIT(A) the aforesaid objective will not be fulfil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Vs. CMR Janardhana Trust (2015) 55 Taxmann.com 516 (Karn.) wherein it was held that payment for services rendered and where such services have resulted in substantial growth in the activities of the trust are to be allowed and cannot be said to be in contravention of provisions of Sec.13(1)( c) of the Act, though such payments are to specified persons u/s.13(3) of the Act. 9. We have considered his submission and find that in the present case no evidence whatsoever of either of the educational qualification or the nature of services rendered by Ms.Trishtha to the trust has been established by acceptable evidence, though there was only a oral assertion by the Assessee in this regard. The CIT(A) had specifically called upon the Assessee to prove with documentary evidence the manner in which services of Ms.Trishtha were utilized by the Assessee. In the given circumstances, we are of the view that the conclusions drawn by the CIT(A) are correct and calls for no interference. 10. Ground Nos.4 5 raised by the Assessee reads as follows: 4.The learned Commissioner of Income Tax (Appeals) erred in confirming the disallowance of depreciation of ₹ 515,36,087/- ignoring the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... see. 14. On appeal by the Assessee, the CIT(A) upheld order of the AO. Aggrieved by the order of the CIT(A), the Assessee has raised ground No.4 5 before the Tribunal. 15. We have heard the submissions of the ld. DR, who relied on the order of CIT(A) and the decision of the Hon ble Delhi High Court in the case of DIT(E) Vs. Charanjiv Charitable Trust (2014) 43 taxmann.com 300 (Delhi). We have considered the order of the CIT(A). Identical issue came up for consideration before ITAT Bangalore Bench in the case of DDIT(E) v. Cutchi Memon Union (2013) 60 SOT 260 Bangalore ITAT, wherein similar issue has been dealt with by this Tribunal. In the aforesaid case, the assessee claimed depreciation and the AO denied depreciation on the ground that at the time of acquiring the relevant capital asset, cost of acquisition was considered as application of income in the year of its acquisition. The AO took the view that allowing depreciation would amount to allowing double deduction and placed reliance on the decision of Hon'ble Supreme Court in Escorts Ltd. (supra). The CIT(A), however, allowed the claim of assessee. On further appeal by the Revenue, the Tribunal held as follows:- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s also made a reference to the decision of the Hon'ble Karnataka High Court in the case of CIT v. Society of Sisters of Anne, 146 ITR 28 (Kar), wherein it was held that u/s. 11(1) of the Act, income has to be computed in normal commercial manner and the amount of depreciation debited in the books is deductible while computing such income. In view of the aforesaid decision on the issue, we are of the view that the order of the CIT(A) on the above issue does not call for any interference. 22. Consequently, ground No.5 raised by the revenue is dismissed. 16. It is no doubt true that the Hon ble Delhi High Court in the case of Charanjiv Charitable Trust (supra) has taken a contrary view but then when two views are possible on an issue, the view favourable to the Assessee has to be followed. The decision of the Hon ble Punjab Haryana High Court is in favour of the Assessee and has followed the decision of the Hon ble Karnataka High Court in the case of Society of Sisters of Anne (supra). The interpretation to the contrary given by the CIT(A) on the decision of the Hon ble Karnataka High Court in the case of Society of Sisters of Anne (supra) cannot therefore be accepted. We ..... X X X X Extracts X X X X X X X X Extracts X X X X
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