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TMI Blog2019 (7) TMI 1377X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Committee by notification dated 07.12.2015, only the appellant herein has felt aggrieved and filed the petition in the High Court. As rightly argued by Revenue the real aggrieved parties, which should have felt aggrieved by insertion of subsection (7) in Section 35AC were those assesses, i.e., Donors who despite paying the donation to the appellant were not allowed to claim deduction of the said amount from their total income during the financial year 2017-2018. One of the main objects for which Section 35AC was enacted was to allow the assessees to claim deduction of the amount paid by them to the appellant for their project. None of the assessees (Donee), who claimed to have paid amount to any eligible projects came forward complaining that despite their donating the amount to the appellant for their project, they were denied the benefit of claiming deduction of such amount from their total income by virtue of subsection (7) of Section 35AC of the Act during the financial year 2017-2018. Benefit of the deduction available u/s 35AC was duly availed of by all the assessee for two financial years, namely, 2015-2016 and 2016-2017. For third financial year, i.e., 2017-2018 beca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of the amount paid by them to the appellant u/s 35AC during the two financial years 2015-2016 and 2016-2017. It is for all these reasons, the matter must rest there. X X X X Extracts X X X X X X X X Extracts X X X X ..... n by the appellant in the Gujarat High Court. The appellant in the petition questioned the constitutional validity of sub-section( 7) of Section 35AC of the Act inter alia on the ground that once the Committee granted an approval to the appellant's hospital project for a period of three financial years, the same could not be withdrawn qua the appellant on the strength of insertion of subsection (7) in Section 35AC of the Act. In other words, the challenge was on the ground that subsection (7) of Section 35AC is essentially prospective in nature and, therefore, it will have no application to those projects which were approved by the Committee prior to insertion of subsection( 7), i.e., 01.04.2017. The challenge was also on the ground that the Revenue cannot apply subsection (7) retrospectively and withdraw the benefits, whether fully or partially, which were approved to the appellant. It was, therefore, contended that the appellant and the assessees should be held entitled to avail of the full benefit for the three financial years in terms of the notification dated 07.12.2015. 11. The respondent (Revenue) supported insertion of subsection (7) in Section 35AC and inter alia con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... SCC 740, Sangam Spinners vs. Regional Provident Fund Commissioner I, (2008) 1 SCC 391 and Commissioner of Income Tax(Central)I, New Delhi vs. Vatika Township Pvt. Ltd., (2015) 1 SCC 1. 16. In reply, learned counsel for the respondent (Revenue) supported the reasoning and the conclusion arrived at by the High Court and prayed for dismissal of the appeal. Learned counsel placed reliance on the decisions in State of Kerala & Anr. vs. Gwalior Rayon Silk Manufacturing (WVG.) Co. Ltd. Etc., (1973) 2 SCC 713, Motilal Padampat Sugar Mills Co. Ltd. vs. State of U.P. & Ors., (1979) 2 SCC 409, R.K. Garg vs. Union of India & Ors., (1981) 4 SCC 675, Kasinka Trading & Anr. vs. Union of India & Anr., (1995) 1 SCC 274, Bannari Amman Sugars Ltd. vs. Commercial Tax Officer & Ors., (2005) 1 SCC 625, Shree Sidhbali Steels Ltd. & Ors. vs. State of U.P. & Ors., (2011) 3 SCC 193, Bajaj Hindustan Ltd. vs. Sir Shadi Lal Enterprises Ltd. & Anr., (2011) 1 SCC 640 and Kothari Industrial Corporation Ltd. vs. Tamil Nadu Electricity Board & Anr., (2016) 4 SCC 134. 17. Having heard the learned counsel for the parties and on perusal of the record of the case, we are not inclined to interfere with the impugned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of this Act for the same or any other assessment year. (4) Where an association or institution is approved by the National Committee under subsection (1), and subsequently- (i) that Committee is satisfied that the project or the scheme is not being carried on in accordance with all or any of the conditions subject to which approval was granted; or (ii) such association or institution, to which approval has been granted, has not furnished to the National Committee, after the end of each financial year, a report in such form and setting forth such particulars and within such time as may be prescribed, the National Committee may, at any time, after giving a reasonable opportunity of showing cause against the proposed withdrawal to the concerned association or institution, withdraw the approval: Provided that a copy of the order withdrawing the approval shall be forwarded by the National Committee to the Assessing Officer having jurisdiction over the concerned association or institution. (5) Where any project or scheme has been notified as an eligible project or scheme under clause (b) of the Explanation, and subsequently- (i) the National Committee is satisfied that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in respect of any assessment year commencing on or after the 1st day of April, 2018. Explanation.-For the purposes of this section,- (a) "National Committee" means the Committee constituted by the Central Government, from amongst persons of eminence in public life, in accordance with the rules made under this Act; (b) "eligible project or scheme" means such project or scheme for promoting the social and economic welfare of, or the uplift of, the public as the Central Government may, by notification in the Official Gazette, specify in this behalf on the recommendations of the National Committee." 19. It is not in dispute that 28 projects were approved by the Committee by notification dated 07.12.2015 but none of them (27) has come forward to question the constitutional validity of subsection (7) except the appellant herein. In other words, out of 28 projects owners whose projects were approved by the Committee by notification dated 07.12.2015, only the appellant herein has felt aggrieved and filed the petition in the High Court. 20. Be that as it may, as rightly argued by the learned counsel for the respondent (Revenue), the real aggrieved parties, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) and other cases relied on by the learned counsel for the respondent Revenue). It is more so when we find that this subsection was made applicable uniformly to all alike the appellant prospectively. 27. It is not in dispute that now time to donate the amount to eligible projects for claiming deduction from the total income for the year 2017-2018 has expired. It is now no longer available due to efflux of time. In this view of the matter, even if the appellant received any amount from any assessee for their project, no deduction could be allowed to such assessee either for the period 2017-2018 or for any subsequent period. 28. It was, however, stated by the learned counsel for the appellant that the appellant has received 3.84 crores during the year 2017-2018 from various assessees. It was also stated that if subsection( 7) 20 had been held not applicable to the appellant's project then the appellant would have received much more amount than ₹ 3.84 crores during the financial year 20172018, which is clear from the amount received by the appellant in earlier two years prior to insertion of subsection( 7), i.e., ₹ 10.97 crores during the financial year 2015-2016 a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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