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TMI Blog2022 (1) TMI 624X X X X Extracts X X X X X X X X Extracts X X X X ..... gors of law will apply. However, if it is an issue of interest on over draft or loan facility for the purposes of the Board, then disallowance cannot be maintained. - Decided in favour of assessee. - ITA No. 647/CHD/2019 (Assessment Year : 2010-11) - - - Dated:- 18-11-2021 - SMT. DIVA SINGH, JM AND SMT.ANNAPURNA GUPTA Assessee by: Shri Tej Mohan Singh, Advocate Revenue by: Shri Ashok Khanna, Addl. CIT ORDER PER DIVA SINGH By the present appeal the assessee assails the correctness of the order dated 12.02.2019 of CIT(A), Patiala pertaining to 2010-11 assessment year on the following Grounds : 1. That the order of the Learned Commissioner of Income Tax (Appeals) is not a complete speaking order, is erroneous and opposed to law and facts in parts. 2. That the Learned Commissioner of Income Tax (Appeals) has erred in interpreting section 11(2) of the Income Tax Act, 1961 viz a viz the underutilized receipts of ₹ 68,81,725/-. 3.That the Learned Commissioner of Income Tax (Appeals) has grossly erred in taxing a sum of ₹ 9,62,580/- of interest on over draft against FDR as penal interest and mis-utilization of funds. 4. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of artists in the mediums of painting, sculpture, theatre, creative writing, music, films, documentaries, multi-media or in any other form. vi) To publish the rich and diverse heritage of Punjab, especially in music, dance, cuisines, costumes etc. vii) To co-ordinate with Government of India, various State Government, Semi- Government Organizations, Non-Government Organizations and other agencies as well as eminent individuals within India and abroad for promotion of tourism and preservation of the cultural heritage of Punjab and for seeking financial contributions for the fulfillment of these objectives. viii) To take steps for securing the participation and involvement of the widest cross-section of individuals and organizations worldwide for the preservation of the cultural heritage of Punjab and development of Tourism in the State. ix) To acquire, purchase, exchange, transfer, lease out, hold or dispose of property and to enter into contracts in pursuance of the functions assigned to the Board. 4. The Aims and Objectives of the Board which were highlighted before the CIT(A) and further relied upon before us found reproduced in the impugned order a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ded in para 4.1 of the impugned order, it was submitted that the assessee had invited attention of the ld. Commissioner to the provisions of sub-section (2) of Section 11 which mandated that 85% of the income of the year was to be applied for charitable purposes and the amount which has not been utilized for charitable purposes could be accumulated as per the Statutory mandate and has to be set apart by the assessee by notice in writing vide Form No. 10 and intimation to the AO about the accumulation which was to be utilized within a period of five years. Accordingly, inviting attention to the finding arrived at in page 5 and 6, it was his submission that the CIT(A) has lost sight of this fact. Form No. 10 was filed and it was noticed to be on record by the CIT(A) himself, hence, it was his limited prayer that the issue may be restored for verification on facts, if need be, 7. The ld. Sr.DR relying upon the impugned order submitted that he has no objection in case the issue is restored back for verification. 8. We have heard the rival submissions and perused the material available on record. On a consideration thereof, we find in terms of ground No. 1 which supports the ar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was ₹ 1,87,487.18 was not immediately traceable. This is primarily due to the fact that the loan account number was not traceable viz a viz the FDR as the Board had a number of fixed deposits in that year. The bank branch has confirmed that the interest paid is normal interest on loans and not penal interest. Hence this disallowance may kindly be deleted. The auditor also did not verify the nature of these expense in detail as considering the amount viz a viz the gross receipts, these Interest payments were very less. 11. Inviting attention to the finding of the First Appellate Authority, it was his submission that these facts as argued by the assessee have not been disputed. Accordingly, addition, it was prayer, may be directed to be deleted. 12. The finding arrived at by the CIT(A) under challenge in the present proceedings : I have carefully perused the written submission of the Ld AR the findings of the Ld AO and contextualised these to the records. That the interest has been categorised by the Auditor of the appellant as penal interest is a matter of record and not in dispute. During the appellate proceedings the Ld AR has submitted the penal interest was ..... X X X X Extracts X X X X X X X X Extracts X X X X
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