TMI Blog2023 (4) TMI 989X X X X Extracts X X X X X X X X Extracts X X X X ..... of donation. It is fact which has been unearthed subsequent to the donations. Therefore, there cannot be any disallowance on this issue - Decided against revenue. - ITA Nos. 67 And 68/Ahd/2022, C.O. Nos. 14 And 15/Ahd/2022 (in ITA Nos. 67 And 68/Ahd/2022) - - - Dated:- 21-4-2023 - Shri Waseem Ahmed, Accountant Member And Shri Siddhartha Nautiyal, Judicial Member For the Assessee : Shri Biren Shah, A.R. For the Revenue : Shri Pravin Verma, Sr. D.R. ORDER PER : SIDDHARTHA NAUTIYAL, JUDICIAL MEMBER:- These are two appeals filed by the Department against the order of CIT(A) for assessment year 2013-14 and assessment year 2014-115 and also assessee s cross objections to the appeals filed by the Department for the aforesaid years. 2. Since common issues for consideration are involved in both the years under consideration, the appeals of the Department and the cross objections filed by the assessee are being disposed of by way of a common order. We shall first discuss department s appeal for assessment year 2013-14. 3. The department has taken the following grounds of appeal:- (1) The Ld.CIT(A) has erred in law and on facts in deleting the bo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aking the addition, the Assessing Officer made the following observations:- 10. The reply of the assessee is perused carefully but not found acceptable/tenable. As the assessed not only failed to establish the genuineness of the contention regarding deduction claimed u/s. 35(1)(ii) of the Act but also found to be deriving benefit by misusing of stationery to evade the legitimate taxes. Therefore, in view of the same following are the observation: 1. M/s Herbicure Healthcare Bio-herbal Research Foundation(HHBRF), Kolkata is not an approved entity u/s. 35(1)(ii)/(iii) of Income Tax Act, 1961. Therefore deduction claimed on account of donation made to the same is not allowable as per law. 2. All the documentary evidences produced by the assessee are nongenuine/ bogus. 11. In view of the above elaborate discussion it is ispo facta established that the deduction claimed by the assessed u/s. 35(1)(ii) of the Act on account of donation made to M/s Herbicure Healthcare Bio-herbal Research Foundation(HHBRF), Kolkata, is not allowable as per law. The deduction claimed to the tune of Rs. 2,10,00,000/- is disallowed and is added back in total income of the assessed. (A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e for deduction u/s. 35(1)(ii) of the Act. The ld. CIT(A) further observed that the basis of reopening of assessment was CBDT s letter dated 14-12-2018, however, on perusal of the assessment order, it was observed that the Assessing Officer has not reproduced the contents of the aforesaid letter on the basis of which the case of the assessee was reopened and additions have been made. Accordingly, the ld. CIT(A) allowed the appeal of the assessee with the following observations:- (viii) In view of above judicial pronouncements relied upon by the assessee, it is observed that jurisdictional High Court and ITAT, have decided the identical issue in favour of assessee. In various judgements, the fact that approval granted by Govt. of India to HHBRF was subsequently withdrawn by the Govt. has been considered. It is observed that Hon'ble Ahmedabad Tribunal, being the jurisdictional Tribunal, in case of Jayesh Prabhudas Shah Vs. ITO vide ITA No: 1150/Ahd/2018 dated 20/02/2020, has considered the aspect that rejection of the allowance claimed u/s 35(1)(ii) was made by AO on the ground that by and under a notification dated 06.09.2016 issued by CBDT, the approval granted to th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... trail should be clearly identified). Nowhere in the assessment order, AO has carried out absolutely any enquiry and investigation under the Act, as was advised by CBDT in its letter, before making disallowances u/s 35(1)(ii). In view of above stated facts and circumstances of the case, and observing that Hon'ble jurisdictional High Court and ITAT have decided the issue in favour of assessee, considering the same, the addition of Rs.2,10,00,000/- made towards disallowance of deduction claimed u/s 35(1)(ii) is deleted. ground no. 2 is allowed in favour of assessee. 7. The Department is in appeal before us against the relief granted by the ld. CIT(A) in the appellate order. The Ld. D.R. placed reliance on the observations made by the A.O. in the assessment order. In response, the counsel for the assessee submitted that the case of the assessee is squarely covered in its favour by the decision of the Gujarat High Court in the case of PCIT vs. M/s. Thakkar Govindbhai Ganpatlal HUF in Appeal No. 881 of 2019 dated 20-01-2020. The counsel for the assessee submitted that it was in the light of the observations made by the Gujarat High Court in the aforesaid case that the rel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed for scientific research vide confirmation dated 29.05.2015. The receiver foundation shall not be confirming the same unless the amount has been utilized for scientific research. The onus has been discharged by the appellant. In the circumstances, it cannot be concluded that the foundation was involved in 100% bogus activity in A.Y.2014-15 which was much before the cancellation notification issued by CBDT u/s. 35(1) (ii). The grounds of appeal are allowed. 5. The Revenue carried the matter before the Tribunal. After considering the facts and findings given by the CIT (Appeals), relying upon the decision in the case of S.G.Vat Care Private Limited in ITA No.1943/Ahd/2017, Tribunal confirmed the deletion made by the CIT (Appeals) on the ground that the there was no disparity of facts in the present case and in the case of S.G.Vat Care Private Limited (Supra). 6. Learned Senior Advocate Mr.M.R.Bhatt for the appellant submitted that there no appeal is filed by the Revenue against the decision of the Tribunal in the case of S.G.Vat Care Private Limited (Supra). It would therefore be germane to refer to the following findings, given by the Tribunal in the case of S.G.Vat C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nor any specific reply deposing that such donation was not received, or if received the same was repaid in cash, has been brought on record. In the absence of such circumstances, donation given by the assesses to the donee, on which the assessee no mechanism to check the veracity, can be doubted, more particularly, when certificate to obtain donation has been cancelled after two years of the payment of donation. It is fact which has been unearthed subsequent to the donations. Therefore, there cannot be any disallowance on this issue. We allow this ground. 7. In the facts of the present case, the CIT (Appeals) has given the finding of the fact that the amount of donation was transferred to the Herbicure through Bank channel and. there is no evidence that the same is returned back in cash. 8. It is also found that the Herbicure Foundation has confirmed that the amount has been utilized for scientific research vide confirmation dated 29.09.2016. Accordingly, the onus placed upon the assessee was discharged. 9. In view of the aforesaid findings of the fact given by both the authorities below, no interfere in the impugned order passed by the Tribunal is required to be m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessee has taken the following grounds in the cross objection:- 1. In law and in the facts and circumstances of the appellant's case, the Ld. CIT(A) has erred in not adjudicating upon Ground No. 1 raised before him which is reproduced in Para-8 of his order. 2. The Ld CIT(A) ought to have appreciated the facts and the submissions made before him in respect of Ground No. 1 and quashed the assessment order as void. 13. Before us, the counsel for the assessee submitted that in case the appeal of the Department is dismissed in view of the favourable decision of the Hon ble Gujarat High Court, the assessee shall not be pressing for its cross objection. We observe that in the aforesaid cross objection, the assessee has challenged the validity of 147 proceedings initiated by the ld. Assessing Officer. However, since we have dismissed the Department s appeal on merits in view of the decision of the Gujarat High Court in the case of PCIT vs. Thakkar Govindbhai HUF supra, we are hereby dismissing the cross objections filed by the assessee as not pressed. In the result, the cross objection filed by the assessee for assessment year 2013-14 are being dismissed as not pressed. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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