TaxTMI 
TaxTMI 
2025 (5) TMI 16
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.... are without prejudice to one another. 2. The learned Commissioner of Income-tax (Appeals), National Faceless Appeal Centre [CIT(A)] erred on facts as also in law in confirming addition of Rs. 87,74,730/-. The addition has been made on the alleged ground of denial of the benefit of exemption u/s 11 and taxing net receipt of 87,74,730/- stating advance of Rs. 13,53,39,422/- hit by the provision of section 13. The addition confirmed by CIT (A) is bad in law as also on facts and therefore the same may kindly be deleted. 3. The learned Commissioner of Income-tax (Appeals), National Faceless Appeal Centre [CIT(A)] erred on facts as also in law in confirming addition of Rs. 69,75,000/-. The addition has been made u/s 68 on the alleged ground of unsecured loan taken from trustee. The addition confirmed by CIT (A) is bad in law as also on facts and therefore the same may kindly be deleted. 4. The appellant craves leave to add, to amend, alter, or withdraw any or more grounds of appeal on or before the hearing of appeal." 5. Briefly stated the facts of the case are that the assessee is a registered charitable organization with DIT(E), Mumbai, u/s 12A of the Act vide Registration No. ....
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....gned property. Insofar as, advance given to Rainbow Tech, the ld. Counsel for the assessee pointed out that it is a opening balance and the advance given to Arun Muchhala Engineering College is nothing but advance given to the second limb of the Trust and the advance given to Arun Muchhala Research & Education Centre is nothing but the closing balance out of the opening balance of Rs. 29.25 Lakhs, given in earlier year. 11. We have carefully perused the copies of the ledger accounts. We find that Ritika Hotels Pvt. Ltd. had an opening balance of Rs. 6,79,90,564/-. This advance was given in earlier years. We find that the same was subject to scrutiny in AY 2006-07 and the quarrel travelled upto the Tribunal and the Co-ordinate Bench in ITA No. 124/Mum/2022 & C.O. No. 71/Mum/2022 has considered this issue and held as under:- "3. Briefly stated, the facts of the case are that the assessee is a public charitable trust and during the year under consideration was engaged in running a polytechnic college. The assessee filed its return of income for the year under consideration on 31.10.2006 declaring Nil income. The assessment was reopened by way of issue of notice u/s 148 of the Act o....
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....taken to decide the issue whether the interest free advance was for the benefit of trust or was for the benefit of the trustee. The learned CIT(A), while adjudicating this issue, has not passed a speaking order and has not given any such facts or referred to any such evidence in support of the contentions of the assessee. In our opinion, this issue deserves to be restored to the file of the learned CIT(A) for denovo adjudication after examining all the evidences which the assessee may place before the learned CIT(A) to decide the issue with the help of actual facts and figures, as to whether the interest free advance was given for the benefit of the assessee trust, or for the benefit of the trustees. The questions that came to our mind some of which have been referred to herein above, need to be answered with the help of evidences and in addition to that the learned CIT(A) is free to call for any other details / evidence to decide the issue as per law and facts. We thus set aside the impugned order passed by the learned Commissioner(Appeals) and allow ground no.1, raised by the Revenue for statistical purposes." 5.1. All the grounds raised by the Revenue are related to the issue-....
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.... back to the file of the Assessing Officer. The Assessing Officer himself has accepted that no advantage has been passed on to the specified persons u/s 13(3) of the Act still the Assessing Officer has filed the appeal on the same issue. This action of the Assessing Officer is not justified unless same is not bonafide. Before us, the Revenue has nowhere said anything on the bonafide of the Assessing Officer while sending the remand report. 5.3. In view of the above facts and circumstances, we do not find any error in the order of the Ld. CIT(A) on the issue-in-dispute and accordingly, we uphold the same." 12. Again this issue arose in AY 2013-14 and the ld. First Appellate Authority held as under:- "7.1. The AO has concluded that the amounts given to M/s Ritika Hotels Pvt. Ltd. is in violation of section 11(5) r.w.s. 13(1)(d) of the I.T. Act, 1961. The appellant, under the facts and circumstances of the case has relied on the decision in the case of CIT Vs Brihdaranyak Mandal Trust (2009) 319 ITR 363 (All.) where it was held that income of educational institution use to purchase Land and construct building constituted application of income. 7.2. It is on record that the appe....
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....he advance was not Interest free but for acquiring land and building for the purpose of Educational Institute run by the appellant trust. u/s. 13, If any, benefit directly or indirectly is given to any trustee, the exemption cannot be allowed u/s. 11 of the Act. In this case, the assessee has only given advance for purchase of property: therefore, it has to be held that advance was given not for the benefit of the specified persons u/s. 13(3) but for the purchase of property for running educational Institute. Hence, I hold that the assessee has given the advance for the purpose of the object of the trust and the same is not hit by the provisions of Section 13(3), but for the furtherance of the objects of the Trust. The assessee trust was already allowed registration u/s. 12A by DIT(E) on the basis of the object of the trust. The AO is directed to allow exemption u/s. 11 as the assessee has given advance for the purpose of the object of the trust and not for the personal benefit of any trustee. This ground of appeal is allowed." Therefore, under the same and similar facts and circumstances of the case, I do not find any reason to deviate from the decision of my predecessor on this....
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....nuine and all the transactions have been done through banking channels. Therefore, we do not find any merit in the impugned additions u/s 68 of the Act. 18.2. The third loan is from Arun Muchhala Co-owners is again the opening balance, therefore, cannot be added u/s 68 of the Act for the year under consideration. 19. Accordingly, the additions made u/s 68 of the Act are directed to be deleted. ITA No. 4081/Mum/2023; AY 2016-17 20. The grievance of the assessee reads as under:- "1. The grounds of appeal mentioned hereunder are without prejudice to one another 2. The learned Commissioner of Income-tax (Appeals), National Faceless Appeal Centre [CIT(A)] erred on facts as also in law in confirming addition. The addition has been made on the alleged ground of denial of the benefit of exemption u/s 11 stating advance of Rs. 6,70,83,844/- hit by the provision of section 13. The addition confirmed by CIT (A) is bad in law as also on facts and therefore the same may kindly be deleted. 3. The learned Commissioner of Income-tax (Appeals), National Faceless Appeal Centre [CIT(A)] erred on facts as also in law in confirming addition of Rs. 80,50,061/-. The addition has been made under....