9911796707
TMI Blog2025 (3) TMI 1040X X X X Extracts X X X X X X X X Extracts X X X X ..... to Government rules and regulations so far as these affect a recognized or aided school. For AY 2020-21, the assessee trust filed its return of income on 28.03.2021 declaring total income at Rs. Nil and claiming exemption u/s 11 of the Act. The return of income filed by the assessee was processed u/s 143(1) of the Act on 30.11.2021 by the Ld. Assistant director, CPC ("AO") determining the total income at Rs. 2, 15, 77, 799/-. 2.1 During the year under consideration, the trust derived gross income from charitable activities amounting to Rs. 2, 15, 77, 799/- and the total expenditure which is application of income u/s 11 of the Act amounted to Rs. 2, 16, 19, 901/- resulting into deficit of Rs. 42, 102/-. It was thus, claimed that the surplus is less than 15% of the gross income which is evident from the audited accounts of the assessee's trust. The assessee has been allowed exemption u/s 11 in the past AYs. The assessee trust also received grant in aid from the Government of Rs. 68, 57, 108/-. It is running various school sectors such as pre-primary, primary, secondary and junior college and each having gross receipts less than Rs. 1 Crore. The Ld. Assessing Officer-CPC ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... TION ESTABLISHMENT EXPENSES AUDIT FEES LEGAL FEES EXPENSES ON PROPERTY-REPAIRS AND MAINETANANCE ETC 1, 82, 17, 002 15, 54, 532 73, 160 1, 23, 132 7, 39, 822 TOTAL OF EXPENSES (B) 2, 07, 07, 648 SURPLUS (A-B) 8, 70, 151 3.1 In support of his above contention(s), the assessee relied on various judicial precedents reproduced by the Ld. Add./JCIT(A) on pages 7 to 9 of his appellate order. After considering the facts of the case and legal submission of the assessee, the Ld. Addl./JCIT(A) confirmed the order of the Ld. AO in disallowing the assessee's claim for exemption u/s 11 and 12 of the Act while processing the return u/s 143(1) of the Act for the reason that the assessee failed to furnish Form 10B as per the required provisions under the Act. As regards the additional claim of exemption u/s 10(23C)(iiiad) of the Act and the additional ground regarding the taxability of net commercial income as against the gross receipts of the trust, the Ld. Addl./JCIT(A) observed that the assessee has taken entirely new claim during the appellate proceedings to claim exemption u/s 10(23C)(iiiad) of the Act in order to take the benefit of the expenses incurred for earn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the circular issued by the Central Board of Direct Taxes (CBDT) Circular No. 16/2022 dated 19th July, 2022 and to claim the benefits of Sections 11 and 12 of the Act. 6.9 In the present case, the appellant has taken entirely new claims during the appellate proceedings to seek a deduction under section 10(23C)(iiiad) of the Act and to seek the benefit of the expense incurred for earning the income. The appellant had the opportunity to revise its return under section 139(5) of the Act, but failed to do so Consequently, only the claim made in the original return or before the assessing officer can be considered at this stage, and any fresh claim will not be entertained during the appellate stage. This position finds support in the decision of the Supreme Court in the case of Goetze (India) Limited vs CIT (2006), where it was held that it is imperative for an assessee to revise its income tax return to raise any new claim not previously submitted in the original return." 4. Dissatisfied, the assessee is in appeal before the Tribunal by raising the following grounds of appeal : "1. On the facts and circumstances of the case and in law the Additional CIT(A)-2, Gurugram, NFAC erred ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lved. 7. We have heard the Ld. Representatives of the parties and perused the material on record. The facts of the case are not disputed. The assessee trust got registration u/s 12A of the Act on 27.05.2021 and therefore it is apparent that the assessee trust was not a section 12A registered trust during the relevant AY i.e. AY 2020-21. Before us, the assessee has challenged the denial of exemption u/s 11 of the Act by the Ld. AO, CPC and confirmation of the same by the Ld. Addl./JCIT(A). However, we note that this ground was not pressed by the assessee before the Ld. Addl./JCIT(A) (para 5 of the impugned order refers). Ld. Counsel for the assessee has also contended that the assessee should alternatively, be granted exemption u/s 10(23C)(iiiad) of the Act as all the conditions for claim of exemption under the said section are satisfied by the assessee. The assessee has raised yet another ground claiming that without prejudice to the above claim, if exemption u/s 11/10(23C)(iiiad) of the Act is not granted, then the taxability of income of the assessee should be based on commercial principles i.e. only the net income should be taxed after allowing the expenses incurred by the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was not having any registration so as to qualify for exemption u/s.11. 4. The AO has recorded in the order u/s.154 that the gross receipts of the assessee were Rs. 4, 31, 18, 956/- and no deduction was allowed for expenses to the tune of Rs. 4, 95, 86, 799/-. We have gone through the Income and Expenditure account of the assessee, whose copy has been placed at page 18 of the paper book. Total of gross receipts on the Income side comes to Rs. 4, 31, 18, 955/-, which has been correctly considered by the AO. However, the amount of total deductions, as taken note of by the AO at Rs. 4.95 crore, is not borne out from the Expenditure side. It appears that the AO took the amount of gross receipts at Rs. 4.13 crore and added 15% at around Rs. 64.00 lakh, to compute the total expenditure at Rs. 4.95 crore. In fact, the assessee's Income and Expenditure Account shows that "Surplus of Income over Expenditure" at Rs. 2, 87, 153/-. In addition, there is "Amount transferred to Reserve or Specific Funds" to the tune of Rs. 9, 54, 000/-. The assessee has claimed deduction for various expenses. It goes without saying that income-tax is charged on the income and not the gross receipts. Income is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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