TMI Blog2022 (10) TMI 119X X X X Extracts X X X X X X X X Extracts X X X X ..... ection 68 of the Act. There is no dispute on this aspect. It applies to all assesses without any exception. Even in the case of a charitable trust, which has offered income in its income and expenditure account in the form of voluntary donation, if such trust fails to explain the source of such voluntary contributions, section 68 of the Act may apply. Earlier decision holding that section 68 does not apply to voluntary contribution were rendered where there was no tax disparity in income taxed as normal income and income as unexplained cash credit under Section 68 of the Act. In the impugned cash where the receipts were impounded by survey team, income offered as voluntary contributions and purpose of such donation is explained, it cannot be added under Section 68 of the Act. Provisions of Section 115BBC were enacted to tax such donations in hands of certain charitable trust and institutions at the rate of 30%. However, sub-section 2 (b) of the Act excludes the trust established woolly for religious and charitable purpose from rigors of that Section. This is also explained in paragraph number 25 of circular number 14/2006 dated 28th December, 2006. In the above aspect and fol ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1995) 80 taxmann 89 (SC) and Durga Prasad More versus CIT (1971) 82 ITR 540 (SC) that apparent must be considered real until it is shown that there are reasons to believe that the apparent is not the real and that the taxing authorities are entitled to look into the surrounding circumstances to find out the reality and the matter has to be considered by applying the test of human probabilities. 03. As per facts available, assessee is a religious trust established wholly for religious purposes registered under Section 12 AA of the Act by The Director of Income Tax (Exemption) Mumbai as per certificate dated 12th September, 2007. 04. It has the object to erect, build, construct, reconstruct, repair, maintained and renovate, takeover and maintain Derasars , Upasharays , Paushad Shala , lecture halls, palkhis, Ardhana Bhavans , meant for stay of sadhus and Sadhvis of Swetambar Murtipujak Jain sangh along with other religious purposes. 05. Assessee filed its return of income on 18th October, 2017 declaring total income of ₹2,23,790/ . This return was processed under Section 143 (1) 27th March, 2019. 06. Subsequently, survey under Section 133A of The Act was conducted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... #8377;148,58,000/- and on 19th November, 2016 a sum of ₹142 lakhs was deposited in the bank account. It was submitted that the above cash is received mainly for the construction of Jain temple at Lonavala. The trust received above voluntary contribution from followers of the religious head. Accordingly, above voluntary contributions are shown as income under Section 12 of The Act, as being income received from the property held under trust wholly for religious purposes. The learned Assessing Officer considered the submission of the assessee and held that assessee did not maintain any record of the identity indicating the name and address of the persons making above donations and further, the assessee has not provided details of the person depositing the above sum in the bank account. The learned AO considered the statement of the trustee recorded during the survey and held that cash donation received of ₹290,58,000/- received from unexplained sources and unidentifiable persons. Out of which assessee has already declared a sum of ₹6,132,500/- as undisclosed income and the balance sum of ₹2,29,25,500/- which is unexplained, unverifiable and unsubstantiated is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ceipts, which were impounded during survey proceedings. The amount of donation received is treated as receipts in the Income and Expenditure account as voluntary contribution. Hon'ble Delhi High Court in DIT Vs. Keshav Social and Charitable Foundation 278 ITR 152 has held that 11. Section 68 of The Act has no application to the facts of the case because the assessee had in fact disclosed the donations of Rs. 18,24,200 as its income and it cannot be disputed that all receipts, other than corpus donations, would be income in the hands of the assessee. There was, therefore, full disclosure of income by the assessee and also application of the donations for charitable purposes. It is not in dispute that the objects and activities of the assessee were charitable in nature, since it was duly registered under the provisions of section 12A of the Act. 014. According to the provisions of Section 68 of the Act, if any sum is found credited in the books of accounts of the assessee including the trust, the nature and source of such credit is required to be explained to the satisfaction of the learned assessing officer. Otherwise, it may be added under Section 68 of the Act. There ..... X X X X Extracts X X X X X X X X Extracts X X X X
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