9911796707
TMI Blog1990 (11) TMI 204X X X X Extracts X X X X X X X X Extracts X X X X ..... be denied and the entire receipts have to be treated as income under s. 12 r/w s. 2(24) (iia) of the IT Act, 1961. The ITO, therefore, treated the entire donations of Rs. 9,98,495 as income of the assessee and subjected it to tax. 3. The assessee appealed to the CIT(A). One of the ground raised before the CIT(A) was that the ITO was not justified in denying exemption under s. 11 on the ground that the audit report was filed at a later stage. It was submitted before the CIT(A) that since the audit report had been filed during the course of assessment proceedings, requirement of cl. (b) of s. 12A was satisfied and therefore the assessee was entitled to the benefit of exemption under s. 11. The CIT(A) rejected the assessee's contention. He was of the view that the audit report was required to be filed alongwith the return as provided under cl. (b) of s. 12A and since it has not been done, the assessee was not entitled to the benefit of ss. 11 12. 4. Learned counsel for the assessee submitted before us that the assessee did not have income in excess of Rs. 25 thousand and, therefore, it was not required to file any audit report under cl. (b) of s. 12A. In the alternative, it was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tained in sub-s. (5) of s. 184 requires that an application for registration of a firm must be accompanied by the original instrument of partnership. This provision was considered by their Lordships of the Gujarat High Court in the case of Billimora Engineering Mart. Their Lordships held that s. 184(5), no doubt, provides that the application for registration shall be accompanied by the original instrument evidencing the partnership. The provision is, however, directory and even if it is mandatory it is capable of being waived. The object of enacting cl. (b) of s. 12A is that a trust claiming exemption under ss. 11 12 must get their accounts audited if its total income exceeds Rs. 25,000 in any previous year. Following the decision of the Tribunal in the aforesaid case as also taking into consideration the decision of the Gujarat High Court cited on behalf of the assessee, we are of the opinion that (sic) the requirement of s. 12A(b) has been substantially complied with and, therefore, benefit of ss. 11 12 cannot be denied to the assessee only on the ground that audit report was not filed alongwith the return. 8. M/s. A.M.D. Corporation head made a donation of Rs. One lakh. A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mplicitor or it was donation towards the corpus fund of the trust. There is nothing in the order of the ITO to show that the assessee was required to substantiate its contention that the donation of Rs. 1,00,000 was towards the corpus of the trust. The assessee filed another confirmation letter from the said party before the CIT(A), which was considered by him while confirming the order of the ITO on the point. True, the second confirmation letter was obtained subsequently, but in the absence of any other material, there was no reason to disbelieve the second confirmation letter, which clearly showed that the donation was made towards the corpus of the trust. Having regard to the evidence and material available on the record it is clear that the donation of Rs. 1,00,000 was made by M/s. AMD Corporation with a specific direction that it shall form the part of the corpus of the trust. The amount of Rs. 1,00,000 therefore cannot be treated as income of the assessee. 12. The ITO treated the amount of Rs. 50,000 donated by M/s. Abaskar Construction Pvt. Ltd as income of the assessee. The CIT(A) after considering the confirmation letter from this party held that the amount of Rs. 50,00 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that it was only a made up game of certain persons and in fact no charitable trust of any sort was really intended to come into existence. In this connection it was submitted that the CIT had issued registration certificate to the assessee trust under s. 12A on21st April, 1984, a copy of which is available at page 1 of the paper book. The assessee was also issued a certificate for exemption under s. 80G, a copy whereof is at page 2 of the paper book. It was submitted that the issue whether the assessee trust is a genuine trust was not before the CIT(A) and that he made an adverse comment against the assessee in a casual manner while considering the question whether donations received from twenty persons were general donations or were donations towards the corpus of the trust Reliance was placed in this connection on the decision of the Tribunal in the case of ITO vs. Mrs. Dwarika Prasad Trust, copy whereof has been filed by the assessee. 17. We have also heard the learned Sr. Departmental Representative who has fully supported the order of the CIT(A) on the point. There is no dispute that the confirmations obtained from the twenty donors contained a specific direction that the do ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... given at pages 13 14 of the CIT(A)'s order. In all these cases donations were made through the same as with regard to the earlier batch of confirmations, therefore, for the reasons already given by him, while considering the other batch of confirmations, he upheld the order of the ITO on the point. 20. We have heard the learned authorised representative of the parties. The assessee has given details of the donors, the amount donated by them as also the particulars of cheques with dates through which donations were made. The fact that the confirmation letters did not bear any date cannot detract from the evidentiary value of these confirmation letters. For the reasons already given above we hold that in view of the confirmation letters from these sixteen parties it is to be held that donations by them were made towards the corpus of the trust. A specific direction to this effect was given in their confirmation letters. These donations from sixteen parties cannot, therefore, be treated as income of the assessee. 21. One of the donors made a donation of Rs. 5,000 and the amount was paid by cheque. Number and the date of the cheque were also given. The confirmation letter showed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ading chartered accountant ofDelhi. The confirmation letter filed by Shri Pradeep Dinodia thus carries due evidentiary value. The CIT(A) has not been able to bring any material on record which could go to suggest that the said letter was not genuine or that it was issued at a later stage but was ante-dated. The CIT(A) has not disclosed any basis for doubting the veracity of this letter. Without bringing any material on record which could create a doubt about the genuineness, veracity or authenticity of the letter dt.22nd Sept., 1982, the CIT(A), in our opinion, was not justified in setting aside the matter to the ITO for making further enquiry. The confirmation letter from Shri Pradeep Dinodia clearly goes to show that the aforesaid donations aggregating to Rs. 35,500 were made with a specific direction that they shall be considered contributions towards the corpus of the trust and, therefore, cannot be treated as income of the assessee in view of s. 2(24) (iia). 27. The only ground which survives for our consideration relates to charging interest under s. 139(8) and 217. Learned counsel for the assessee submitted before us that this ground was merely consequential. We accordingl ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
