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TMI Blog2015 (1) TMI 781X X X X Extracts X X X X X X X X Extracts X X X X ..... idend income of ₹ 61.46 lacs and exemption u/s 10 (38) of ₹ 1,17,262/-. On this aspect, we do not find any infirmity in the order of CIT(A) and therefore, decline to interfere in the order of CIT(A) on this issue. Thereafter in Para 4(11), it is held by CIT(A) that in his view, the hospital and liaison office are to be considered as a whole and not separately and therefore, the income generated at the liaison office having been utilized for the objects of the assessee trust, which is philanthropic u/s 10(23C)(iiiae) of the Act, is eligible for exemption under that section. Thereafter, he directed the Assessing Officer to allow exemption u/s 10(23C)(iiiae) on the entire income of ₹ 71,93,691/-, which also includes income of ₹ 62.64 lacs being separately exempt u/s 10(34) and 10 (38). On this aspect, we do not find any merit in the stand taken by CIT(A) because as per the provisions of clause (iiiae) of section 10(23C), only those income which are received by a hospital on account of treatment is exempt u/s 10(23C)(iiiae) and not any income received by the said entity. Hence, on this aspect, we reverse the order of CIT(A) and restore that of the Assessing Offi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... KW/2011 - - - Dated:- 7-1-2015 - Shri Sunil Kumar Yadav And Shri A. K. Garodia,JJ. For the Petitioner : Shri R. K. Ram, D.R. For the Respondent : Shri Abhinav Mehrotra, Advocate ORDER Per A. K. Garodia, A.M. Out of this bunch of four appeals, there are three appeals filed by the Revenue and the remaining one appeal is filed by the assessee, which is directed against the order passed by learned CIT(A) dated 18/05/2011 and the appeals filed by the Revenue are directed against three separate orders of learned CIT(A)-I, Lucknow dated 14/03/2013 for assessment year 2008-09, dated 15/02/2013 for assessment year 2009-10 and dated 15/02/2013 for assessment year 2005-06 and all these appeals were heard together and are being disposed of by way of this common order for the sake of convenience. 2. First we take up the appeal of the Revenue for assessment year 2005- 06 i.e. I.T.A. No.391/Lkw/2013. In this appeal, the Revenue has raised the following grounds: 1. The Ld. CIT (A) has erred in law and on facts of the case in allowing exemption U/s 10(34) and 10(38) on dividend income and on redemption of Mutual fund units respectively without appreciating the fa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y, postage and telegram, telephone expenses, travelling expenses and financial aid to poor and indigents patients at ₹ 7,470/-. The Assessing Officer has allowed all other expenses except donation of ₹ 25 lacs and financial aid to poor and indigent patients at ₹ 7,470/- and worked out the income at ₹ 71,93,691/-. Now the question is whether the assessee is eligible for exemption u/s 10(23C)(iiiae) of the Act. Hence, we reproduce the provisions of relevant clause (iiiae) of section 10(23C), which is as under: (iiiae) any hospital or other institution for the reception and treatment of persons suffering from illness or mental defectiveness or for the reception and treatment of persons during convalescence or of persons requiring medical attention or rehabilitation, existing solely for philanthropic purposes and not for purposes of profit, if the aggregate annual receipts of such hospital or institution do not exceed the amount of annual receipts as may be prescribed. 4.1 From the above provisions, it is seen that any income received by any hospital or other institution for the reception and treatment of persons suffering from illness or mental defectiv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t is exempt u/s 10(23C)(iiiae) and not any income received by the said entity. Hence, on this aspect, we reverse the order of CIT(A) and restore that of the Assessing Officer. 6. In the result, the appeal of the Revenue stands partly allowed in the terms indicated above. 7. Now we take up the appeal of the assessee for the assessment year 2006-07 i.e. I.T.A. No.470/Lkw/2011. In this appeal, the assessee has raised the following grounds: 1. That the Learned CIT(A) erred in law as well as on facts in conforming the assessment order passed u/s 143(3) dated 18/12/2008 on a total income of ₹ 681370/- by the A.O. which is contrary to law, facts and circumstances of the case. 2. That the Learned CIT(A) erred in law as well as on facts in not holding that the entire receipts of the appellant being below ₹ 1 Crore is fully covered within the provisions of Section 10(23C)(iiiae) of the Income Tax Act 1961 and even misinterpreted the decision of the High Court in the case CIT Vs Navhinandan Digamber Jain 257 ITR 91 which is also applicable in respect of dividend income exempt u/s 10(34) of the Income Tax Act 1961 as upheld in number of cases. 3. That the Learned CI ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssed by the Assessing Officer is consisting of interest income only. We have already decided while deciding the appeal of the Revenue for assessment year 2005- 06 that exemption is not allowable to the assessee u/s 10(23C)(iiiae) of the Act in respect of interest income. Hence, we decline to interfere in the order of CIT(A) on this issue. 10. In the result, the appeal of the assessee stands dismissed. 11. Now we take up the appeal of the Revenue for assessment year 2008- 09 i.e. I.T.A. No.724/Lkw/2013. In this appeal, the Revenue has raised the following grounds: 1. The Ld. CIT(A) has erred in law and on facts of the case in allowing exemption u/s 10(34) on dividend income without appreciating the fact that the assessee has never claimed exemption under this section, in the return of income. The A.O. has explicitly mentioned in assessment order that dividend has been received by Shri Chetan Mehrotra (trustee) and not the trust, hence trustee would be entitled for exemption u/s 10(34) and not the trust. 2. The Ld. CIT (A) has erred in law and on facts of the case in allowing exemption u/s 10(23C)(iiiae) on interest income without appreciating the fact that the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mitted that Lion Clubs International Foundation is assessed in India under PAN AAAAL1691F. I have considered the submissions of the appellant and I find that income has been properly applied for charitable purposes in India as per provisions of section 11 of the Act and no addition is warranted on this account. 14.1 From the above Para from the order of CIT(A), we find that this issue was decided in favour of the assessee on the basis of this fact that the donnee M/s Lions Clubs International Foundation is having office at Mumbai also. This amount has been given towards the project of campaign sight first- II. It is also noted by CIT(A) that M/s Lions Clubs International Foundation is assessed in India under PAN AAAAL1691F. He has given a clear finding that the income has been properly applied for charitable purposes u/s 11 of the Act and no addition is warranted. Learned D.R. of the Revenue could not controvert this finding of CIT(A). Regarding the technical objection that there is violation of Rule 46A, we are of the considered opinion that for a small amount and after such a clear finding, no purpose will be served by restoring the matter back to the Assessing Officer and th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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