TMI Blog2016 (3) TMI 1219X X X X Extracts X X X X X X X X Extracts X X X X ..... receipt of the donations and incurring expenditure. The authorities below after granting deduction of the expenses claimed, made the small addition against the assessee considering the donations and corpus donations to be income under section 2(24). The assessee, therefore, disclosed complete facts before the authorities below and, therefore, could not be said to have concealed particulars of income. The small income was assessed against the assessee because no registration was granted under section 12A of the Act. Assessing Officer should have followed the rule of consistency and on the same set of facts should not levy penalty against the assessee in assessment years under appeals. It is well settled law that the Income Tax Authoriti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the assessee had received donations during the years and as per sections 2(24) and 11(1) (d) of the Act, the donations and corpus donations respectively formed the income of the trust and in the absence of registration under section 12AA of the Act, the same is taxable. Therefore, after deduction of expenses incurred wholly and exclusively for the purpose of earning that gross receipts, the net income was found, which was added to the total income of the assessee. The proceedings under section 271(1)(c) of the Act were initiated. The Assessing Officer vide separate orders levied the penalties against the assessee. 4. The assessee submitted before the learned CIT (Appeals) that the returns of incomes were filed for assessment years u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessment year 2010-11 are pending. The learned CIT (Appeals), however, did not accept the contention of the assessee because there was no registration granted under section 12AA of the Act in favour of the assessee in these years. Therefore, the Explanation-1 to section 271(1)(c) of the Act was applied and the appeals of the assessee were dismissed. 5. On consideration of the rival submissions, I do not find any justification to sustain the levy of penalty under section 271(1)(c) of the Act. The learned counsel for the assessee relied on the decision of the Hon'ble Supreme Court in the case of CIT Vs. Reliance Petroproducts (P) Ltd., 322 ITR 158, in which it was held as under : Merely because the assessee claimed deduct/on of i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rocessors Others, 306 ITR 277 and CIT Vs. Atul Mohan Bindal, 317 ITR 1. 6.1 On consideration of the facts of the case, it may be noted that the assessee trust executed the trust deed dated 24.2.1984 and was duly registered. It is also explained that the assessee applied for grant of registration under section 12A of the Act with Commissioner of Income Tax, Patiala in February, 1985. Therefore, the assessee remained under bonafied belief that it has duly been registered though no formal order was passed under section 12AA of the Act. Merely because the claim of the assessee for deduction under section 11 of the Act was not accepted, may not be a ground for levy of penalty. Further, the assessee wrongly claimed exemption under section 11 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t take any action against the assessee on the same facts and circumstances for levy of penalty under section 271(1)(c) of the Act. Therefore, the Assessing Officer should have followed the rule of consistency and on the same set of facts should not levy penalty against the assessee in assessment years under appeals. It is well settled law that the Income Tax Authorities shall have to maintain the rule of consistency. We rely upon the decision of the Hon'ble Supreme Court in the case of CIT Vs. Radha Swami Satsang, 193 ITR 321, the decision in the case of UOI Vs. Satish Panalal Shah, 249 ITR 221 and the decision of Delhi High Court in the case of CIT Vs. A.R.J. Security Printers, 264 ITR 276. Further, the explanation of the assessee was ..... X X X X Extracts X X X X X X X X Extracts X X X X
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