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TMI Blog2021 (2) TMI 97X X X X Extracts X X X X X X X X Extracts X X X X ..... of natural justice the entire proceedings should be quashed. 3. On the facts and in the circumstances of the case and in law the Learned Assessing Officer erred in withdrawing the weighted deduction u/s 35(1)(ii) without making appropriate enquiries in case of appellant and merely on the basis of general statement made by one Mrs. Samadrita Mukherjee Sardar who has not even alleged that accommodation entry has been given to appellant. The appellant craves for to leave, add, alter, modify, delete above ground of appeal before or at the time hearing, in the interest of natural justice." 3. Briefly, the facts of the case are as under :- The appellant is a company incorporated under the provisions of the Companies Act, 1956. It is engaged in the business of transport solutions. The return of income for the assessment year 2013-14 was filed on 29.09.2013 disclosing the income of Rs. 3,07,22,727/-. The said return of income was selected for scrutiny under CASS and the assessment was completed by the Assistant Commissioner of Income Tax, Circle-9, Pune ('the Assessing Officer' for short) vide order dated 23.03.2016 at a total income of Rs. 5,35,97,730/-. While doing so, the Assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... led submissions vide letter dated 08.02.2016 wherein, inter-alia, it denied allegation of receipt back of the donations in cash or any other form from SHGPH. Further, it was contended that the admission made is not conclusive and it can always open to an assessee to retract the such admission relying upon the decision of the Hon'ble Supreme Court in the case of Pullangode Rubber Produce Co. Ltd. vs. State of Kerala, 91 ITR 18 (SC). The appellant also sought the opportunity of cross-examination of the SHGPH, in case the Assessing Officer relied on the statement of the said organization and lastly it was submitted that the donation was made considering the Research activity carried on by the said organization. 6. On receipt of the said explanation, the Assessing Officer had expressed inability to offer the opportunity of cross-examination of Secretary, SHGPH on the citing the inconvenience and tedious nature instead the appellant company was directed by the Assessing Officer to produce the Secretary of SHGPH. Finally, the summons u/s 131 of the Act were issued on 26.02.2016 to the Secretary, SHGPH, Mrs. Samadrita Mukherjee Sardar was directed to appear in his office on 17.03.2016 w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aced reliance on the decision of the Hon'ble Supreme Court in the case of CIT vs. Chotatingrai Tea & Ors. Etc. 258 ITR 529; decision of the Hon'ble Bombay High Court in the case of National Leather Cloth Manufacturing Co. vs. Indian Council of Agricultural Research & Ors., 241 ITR 482; and the decision of Hon'ble Gujarat High Court in the case of PCIT vs. Thakkar Govindbhai Ganpatlal HUF in R/Tax Appeal No.881 of 2019 dated 20.01.2020. 10. On the other hand, ld. CIT-DR contended that from the very fact that the research organization i.e. SHGPH admitted that the modus operandi before the Hon'ble Settlement Commission is a conclusive evidence to show that the donee had been engaged in the fraudulent activities of providing the accommodation entries for donors and the assessee had failed to discharge primary the onus cast upon it. He further submitted that the doctrine of promissory estoppels has no application to tax concessions and the very fact that vide Notification dated 28.01.2010 rescinded the approval granted to the donee organization with retrospective effect. It was further submitted that the case laws relied on by the appellant company has no application to the facts of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ns, which reads as under :- "However, the Ministry of Finance (Department of Revenue ) (Central Board of Direct Taxes) Vide Notification No. 82/2016/F.No. 203/64/2009/IT A.I1 dated 15.09.2016 in The Gazette of India: Extra Ordinary had rescinded the Notification granting approval by the Central Government to the appellant for the purpose of clause (ii) of sub section (1) of section 35 of the I.T. Act, 1961, read with Rule 5C and 5E of the Income tax Rule, 1962. The Notification reads as follows: "'Ministry of Finance, (Department of Revenue) (Central Board of Direct Taxes) Notification New Delhi, the 15th September, 2016, S.O. 2961(E)-In exercise of the powers conferred under clause (ii) of sub-section (1) of section 35 of the Income-tax Act, 1961 read with Rule 5e and 5E of the Income-tax Rules, 1962, the Central Government hereby rescinds the notification of the Government of India, Ministry of Finance, Department of Revenue number 4/2010 dated 28.01.2010 published in Gazette of India , Part 11, Section 3, Sub-section (ii) dated 28.01.2010 vide S.O. 348 with effect from 1st April, 207 and shall be deemed that the said notification has not been issued for any tax benefits ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on to tax concession granted by the Legislature. However, keeping in view the provisions of Explanation inserted to section 35(1)(ii) by Finance Act, 2006, w.e.f. 01.04.2006 providing that the deduction in the hands of the donor shall not be denied merely because of the fact that an approval granted to the University which is the Research University, Colleges and other University which has been withdrawn subsequently to the payment of donations, the donors should not suffer on account of withdrawal of the approval to done organization. The intent of the Legislature is clear that the donors should not be made suffer on account of fraud committed by the donee organization. 15. Further, the Hon'ble Supreme Court in the case of CIT vs. Chotatingrai Tea & Ors., 258 ITR 529 following the decision of the Hon'ble Calcutta High Court in the case of CIT vs. Bhartia Cutler Hammer Co., 232 ITR 785 held that notwithstanding the fact that the approval granted earlier to the Research Organization was withdrawn subsequent to the payment of donation, the deduction cannot be withdrawn in the hands of the donors. The Hon'ble Jurisdictional High Court in the case of National Leather Cloth Manufacturi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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