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TMI Blog2022 (3) TMI 1067X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee during the relevant financial period, wholly or exclusively for the purpose of marking or earning such income/receipts has to be allowed as per provisions of section 57(iii) of the Act and this legal provision has not been controverted by Ld. SR DR. Assessee, at Bar, has pleaded that since the total income of the assessee trust is ₹ 97,40,810/-, which is below ₹ 1,00,00,000/-, the audit report is not required in this case. He also vehemently pointed out that no audit report has been filed alongwith the e-return. Therefore, the presumption of Ld. CIT(A) that the assessee trust must have filed audit report, is not based on any documentary evidence furnished before us. However, the remaining amount i.e. receipts of i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ngalore without considering the details of expenses reported by the assessee in Form ITA-7, Part B-TI, Column-4 and in Schedule ER. 4. For that the Ld. CIT(A) has erred both in law and fact by assuming variance in data given in ITR-7 and audit report. The actual fact is that no audit report is filed by the appellant as the same is not required to be filed by the appellant as per the provision of law. 3. Facts of the case are that the assessee is a charitable trust running a school since 1982. The assessee trust filed its return of income on 27.10.2018 showing an income of ₹ 18,12,685/- being interest from bank and I.T. return, thereby claiming exemption of ₹ 24,30,289/- u/s. 10(23C)(iiad) i.e. excess of gross receipts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... same is not required to be filed by the assessee as per the provisions of law. Ld. A.R. submitted that merely because due to inadvertent mistakes at the time of filing e-return done by the assessee, the CPC proceeded to make addition without providing due opportunity of hearing to the assessee. Therefore, the assessment order is bad in law. He also submitted that since the assessee is not having registration u/s. 12AA of the Act, therefore, the assessee has to be treated as Association of Persons (AOP) for the purpose of application of provisions of Income tax Act and in this situation, according to normal principles of accounting, the expenditure incurred by the assessee for the purpose of activities of the AOP has to be allowed out of en ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... egard. Therefore, addition made by the AO-CPC and confirmed by the Ld. CIT(A) may kindly be confirmed. 7. Ld. SR DR also submitted that when the assessee itself is stating that he has filed audit report alongwith return of income, then the authorities below were in doubt regarding correctness of the claim of expenditure of the assessee, therefore, the addition made by the AO and confirmed by Ld. CIT(A) may also kindly be upheld on this count. 8. Placing rejoinder to above, Ld. AR submitted that the AO has not raised any doubt regarding claim of expenditure as mentioned by the assessee in column 4(i) of return of income. It is also not the case of the authorities below that these expenditures of ₹ 7,310,521/- are not incurred exc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be treated as an AOP for the purpose of calculation of tax liability in the hands of the assessee. In this situation, as per normal accounting principles and keeping in view the preposition rendered by Indore Bench of ITAT in the case of Shri Vaishnav Polytechnic College Govern by VSK Market Tech Educational Society (supra), all incidental expenditure incurred by the assessee during the relevant financial period, wholly or exclusively for the purpose of marking or earning such income/receipts has to be allowed as per provisions of section 57(iii) of the Act and this legal provision has not been controverted by Ld. SR DR. 11. Ld. counsel for the assessee, at Bar, has pleaded that since the total income of the assessee trust is ₹ 97, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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