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TMI Blog2017 (4) TMI 1065X X X X Extracts X X X X X X X X Extracts X X X X ..... y or educational institute does not exceed the amount of annual receipt as may be prescribed. After examining the matter, the Tribunal concluded that the objects of the assessee trust being charitable had not been objected nor it was the case of the revenue that the donation in the shape of land or amount had been utilised for any other purposes except on the objects of the assessee trust. Of course, no educational activity had been started by the assessee during the year but at the same time, this fact had not been doubted that the assets and funds received by it in donation were meant for achieving its objects. Thus, the Tribunal rightly while setting aside the orders of the authorities below directed the Assessing officer to delete the addition treating the assessee as registered trust with charitable objects. - Decide against revenue - ITA No. 282 of 2015 - - - Dated:- 23-2-2017 - Ajay Kumar Mittal And Ramendra Jain, JJ. Mr. Denesh Goyal, Advocate for the appellant Mr. Ved Jain, Advocate for the respondent ORDER Ajay Kumar Mittal, J. 1. This appeal has been preferred by the appellant-revenue under section 260A of the Income Tax Act, 1961 (in short, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d as such the corpus donations were liable to be included as income. The assessee trust filed further appeal before the Tribunal. Vide order dated 10.12.2014, Annexure A.III, the Tribunal allowed the appeal filed by the assessee holding that the CIT(A) was not justified in upholding the action of the Assessing Officer on the basis that no registration under section 12AA of the Act was available to the assessee trust for the year under consideration and as such corpus donations were liable to be included as income. Direction was issued to the Assessing officer to delete the addition treating the assessee as a registered trust with charitable objects. Hence the instant appeal by the appellantrevenue. 3. We have heard learned counsel for the parties. 4. Learned counsel for the appellant revenue submitted that the assessee was granted registration under Section 12AA w.e.f 1.4.2009 which would be operative for subsequent period whereas assessment was for the assessment year 2007-08 and therefore amount of ₹ 1.01 crores and ₹ 14 lacs totalling ₹ 1.15 crores was rightly taxed by the Assessing Officer. 5. Opposing the aforesaid contention, learned counsel for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 11 is that its application for registration under section 12AA was rejected by the learned CIT. In this regard, the learned AR submitted that the matter was travelled upto the ITAT and registration under section 12AA was granted to the assessee by the learned CIT w.e.f 1.4.2009 while complying the direction of the ITAT. The learned AR submitted that the registration was granted well before the passing of the assessment order on 30.12.2011. He submitted further that the Finance (No.2) Bill 2014 proposed to allow benefit of availing exemption under section 11 and section 12AA to a trust or institution which has been granted registration subsequently in respect of preceding assessment years, the proceedings which are pending before the Assessing officer as on the date of such registration. The only condition is that the objects and activities of such trust or institution should be same on the basis of which such registration has been granted. It has been further provided that no action for reopening of assessment proceedings under section 147 shall be taken by the Assessing Officer in the case of such trust or institution merely on the ground that such trust or institution has not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... marls. The lands were valued at ₹ 1.01 crore as per official circular rate of ₹ 4 lacs per killa and stamp duty and registration expenses of ₹ 3.10 lacs were born by the trust. The trust made entries in its books of account crediting the corpus fund and debiting the loan account with the notional value of land at ₹ 1 crore. The assessee further received corpus donation of ₹ 15 lacs from three concerns. During the year under consideration, the only receipt of trust was of ₹ 5450/- from bank interest and there was net loss of ₹ 2100/-. There are certain undisputed facts that the registration under section 12AA of the Act has been granted to the assessee by the learned CIT w.e.f 1.4.2009 which is before the date of the assessment order passed on 30.12.2011 and obtaining registration under section 12AA is not mandatory for claiming the exemption under section 10(23C) (iiiad) of the Act. As per this section, any income received by any person on behalf of any university or other educational institution existing solely for educational purposes and not for the purpose of profit is exempt if the aggregate annual receipt of such university or educati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... have been utilized for any other purposes except on the objects of the assessee trust. Of course, no educational institution has been started by the assessee during year but at the same time, this fact has not been doubted or denied that assets and funds received by it in donation were meant for achieving its objects. Under these facts and circumstances in totality, we are of the view that the learned CIT(Appeals) was not justified in upholding the action of the Assessing officer on the basis that no registration under section 12AA of the Act was available to the assessee trust for the year under consideration and as such corpus donation are liable to be included as income. We thus while setting aside the orders of the authorities below in this regard direct the AO to delete the addition treating the assessee as registered trust with charitable objects. The ground Nos. 3 to 5 involving the issue are thus decided in favour of the assessee and are allowed as such. The ground No.1 is general in nature and the issue raised in ground No.2 questioning the validity of initiation of the proceedings under section 147 of the Act has become infructuous in view of the finding on the main issue ..... X X X X Extracts X X X X X X X X Extracts X X X X
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