TMI Blog2017 (8) TMI 954X X X X Extracts X X X X X X X X Extracts X X X X ..... nder:- That on the facts and in the circumstances of the case:- 1. The order of the learned Assessing Officer is bad both in law and on the facts of the case. 2. The learned Commissioner of Income Tax (Appeals) erred in sustaining the action of the learned Assessing Officer in determining Net Taxable Income of ₹ 21,00,000. 3 The learned Assessing Officer erred in holding that the assessee failed to produce any documentary proof for expenditure of ₹ 21,00,000 on the specific purpose of research activity for which it was accumulated. 4. The learned Assessing Officer erred in making an addition of ₹ 21,00,000 to the returned income holding that the amount accumulated under section 11 (2) of the Income Tax Act, 1961 out of income for the financial year 2003-04 was not utilised up to the previous year relevant to the assessment year 2010-11. 5 The learned Assessing Officer erred in charging interest uls 234C without authority under the Act. 6. The order of 'the learned Commissioner of Income Tax' (Appeals) suffers from plethora of errors including incorrect reference to Sections of the Income Tax Act, quoting incorrect. Form No. and incorrec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... expenditure of ₹ 21 lacs on specific purpose of such activities for which it was accumulated and he taxed the amount in dispute for the financial year 2009-10 i.e. Assessment year 2010-11 and completed the assessment on 26.2.2013 u/s. 143(3) of the Act. Aggrieved by the assessment order dated 26.2.2013 assessee filed appeal before the Ld. CIT(A), who vide his impugned order dated 7.3.2014 dismissed the appeal of the assesse. Now the assessee is aggrieved against the impugned order and file the present appeal before the Tribunal. 4. At the time of hearing, Ld. Counsel of the assessee stated that during the current year, the assessee has received a sum of ₹ 4,74,75,182/- which is mainly for the grants received from the Ministry of External Affairs and other Ministries and has incurred the expenditure of ₹ 4,77,78,369/- and as such there is excess expenditure of ₹ 3,03,181/-. He further submitted that accumulated income of AY 2004-05 of ₹ 21 lacs has been spent during the current year and the same is eligible for standard deduction/ standard accumulations @15% from the current year income u/s. 11(1)(a) of the Act. Therefore, he requested that earlier ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncome tax Act,1961 out of income for the financial year 2003 - 04 should not be taxed in the assessment year 2010 - 11 is as under :- 1 . RIS is a non - profit making society registered under the Society Registration Act, 1860 . RIS, an autonomous think - tank under the aegis of Government of India, Ministry of . External Affairs, is an organization that specializes in policy research an international economic issues and development cooperation . 2 . RIS is registered under section12A ( a ) of the Act vide order dated November 28 . 1 . 986 . RIS enjoys exemption under section 10 ( 23C )( iv ) of the Act . 3 . As per the form No . 10 Submitted along with the return of Income for the assessment year 2004 - 05, Rs . 21,00,000 /- was accumulated under section 11 ( 2 ) of the Act to carry out research activity as envisaged in the Memorandum of Association and Rules of RlS . Copy of the Form No . 10 is attached as [ Annex'1'} herewith for your ready reference . 4 . Following are the main objectives of RIS as per Memorandum of Association and Rules : a} To promote the concept of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... research activities . 6 . During the previous year relevant to 'the assessment year 2010 - 11, RIS utilized Rs . 4,77,78,363 for its activities . Whereas total income of RIS for the previous year relevant of the assessment year 2010 - 11 was Rs . 4,74,75,182 . 7 . It is apparent from the above that RlS has utilized some of the funds of past accumulations during the previous year relevant to the assessment year 2010 - 11 . 8 . As per provisions of section 10 ( 23C ( iv ) of the Act, after setting apart Rs . 18,00,000 /- i . e . amount being les than 15 % of the income of the previous year relevant to the assessment year 2010 - 11, income available for utilization was Rs . 4,56,75,182 /-. Whereas Rs . 4,77,78,363 /- was utilized during the year . 9 . Hence it may not be pre to state that the past accumulations have not been utilized . 10 . It is prayed that the accumulation out of the income for the previous year relevant to, the assessment year 2004 - 05 may please be treated as utilized during the previous year relevant to the assessment year 2010 - 11 for the purpose mentio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bring to your notice that it has been decided by a resolution passed by the RIS Governing Council Members on 26'h June 2003 ( and also on February 7, 1989 ) ( copy enclosed ) that, out of the income of the RIS for the previous years ) , relevant to the Assessment Year 2004 - 2005 and subsequent 2009 - 2010 previous years ) , an amount of Rs . 21,00,000 /- of the income of the RIS as is available at the end of the previous year should be accumulated or set apart till the previous year ( s ) ending 2009 in order to enable 'the RIS Governing Council to accumulate sufficient funds for carrying out the following purposes :- i ) Carry out research activity as envisaged in the Memorandum of Association and Rules of RIS . 2 . Before expiry of six months commencing from the end of each previous year, the amount so accumulated or set apart will be . invested or deposited in anyone or more of the forms OF mode specified in sub - section ( 5 ) of Section 11 . 3 . Copies of the annual accounts of the RIS along with details of investment ( including deposits ) and utilization, if any, of the money so accumulated or ..... X X X X Extracts X X X X X X X X Extracts X X X X
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