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TMI Blog2022 (7) TMI 669X X X X Extracts X X X X X X X X Extracts X X X X ..... nt order u/s 143(3) of the Act dated 08 December 2017 is erroneous and bad in law. 1.2 An order of assessment cannot be set aside to assessing officer (AO) u/s 263 of the Act for the purpose of making further enquiries and thereafter pass fresh order of assessment. Therefore, such impugned order and directions issued u/s 263 are untenable, contrary to law and unsustainable. 1.3 No justification is available to allow the AO to make independent re-verification with regards to movement of funds and verify the application of income as these were duly and sufficiently verified by the AO at the time of original assessment proceeding vide order dated 08 December 2017. Ground 2 - Without prejudice to the above, CIT ignored the retrospective amendment under FCRA Act, 2010 with respect to foreign contribution. 2.1 Without prejudice to the above ground, retrospective amendment to proviso under the FCRA Act, 2010 vide Finance Act, 2016 and also by Finance Act, 2018 states that the donations amounting to INR 63,18,46,554/- shall not be classified as foreign contribution received by the Trust. Ground 3 - That the appellant craves leave to add, amend, modify, rescind, supplement or alte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d requested that the proceedings under Section 263 of the Act be dropped. However, the CIT(E), vide order dated 28.03.2018, concluded that the Assessment Order, dated 08.12.2017, was erroneous and prejudicial to the interest of the Revenue. Exercising powers of revision under Section 263 of the Act read with Clause (a) of Explanation 2 to Section 263 of the Act, the CIT(E) set aside the Assessment Order, dated 08.12.2017, with the directions to the Assessing Officer to pass assessment order de-novo as according to CIT(E) the Assessing Officer had failed to make necessary enquiries which he was expected to make in the facts and circumstances of the case. 6. Being aggrieved, the Appellant has filed the present appeal. 7. The Learned Authorised Representative of the Appellant appearing before us submitted that during the course of the assessment proceedings, Assessing Officer had called for all the relevant details. In this regard, he referred to letter dated 29.06.2017 and 03.11.2017 filed during the course of assessment proceedings forming part of the paper book. He submitted that all the relevant documents such as audited financial statements, statement of computation of income, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2 to Section 263(1) of the Act which has been invoked to set aside Assessment Order dated 08.12.2017 which in any case is not applicable in the facts of the present case. He further submitted that the CIT(E) has failed to carry out any enquiry without remitting the matter to file of Assessing Officer for verification and the same is contrary to the judgment of Hon'ble Bombay High Court in the case of CIT vs. Gabriel India Ltd. (1993) 203 ITR 108. 9. Per contra, Ld. Departmental Representative submitted that the Assessing Officer had failed to make the necessary enquiries about the contributions received by the Appellant during the relevant previous year and the application of the same towards the objects of the trust. The Assessing Officer has merely accepted the submissions made by the Appellant without making necessary enquiries. Since the Appellant did not have any accumulations from earlier years, the Assessing Officer should have enquired into the source of funds applied by the Appellant. He further submitted that the order passed by CIT(E) does not suffer from any infirmity and in this regard he referred to the notice issued under Section 263(1) of the Act and order passed b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted 29.06.2016 read as under: "6. Copy of audited financial statements of the Trust is enclosed herewith marked as Annexure-D. 7. Copy of statement of computation of income is enclosed herewith marked as Annexure-E xx xx 9. Details of on-corpus donations received during the captioned assessment year are enclosed herewith marked as Annexure-G. Further, the assessee submits that during the captioned AY 2015-16, the Trust has not received any corpus donation. xx xx 11. Detail of expenses incurred for the objects of the Trust is enclosed herewith marked as Annexure-I. xx xx 13. It is submitted that since the formation of the Trust i.e. from Assessment Year 2007-08, the Trust has not made any accumulation u/s 11(2) of the Act. It has applied its income for charitable purpose in the year of receipt of income as per the provisions of section 11(1)(a) of the Act i.e. 85% or more of its income for charitable purpose. Hence the question of utilization made u/s 11(2) of the Act does not arise. 14. As mentioned above, the Trust has applied its income for charitable purpose in the year of receipt of Income as per the provisions of section 11(1)(a) of the act i.e. 85% or more o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... trust in the earlier years which has been applied for the objects of the trust as is clear from bare reading of the receipts and payments account. Since the claim made by the Appellant as well as all the facts were apparent and clearly on record, we do not agree with the CIT(E) that any further inquiry/verification was warranted in the facts of the present case. There was nothing on record to invite further enquiry into the matter in view of the disclosures already made. According to CIT(E), the Assessing Officer fell in error by not enquiring about the source of money applied by the Appellant towards the objects of the trust since the foreign contribution was deposited in escrow account. We note that in the case of Chotanagpur Diocesan Trust vs. ITO (supra) it has been held as under: "5. We have considered the contentions of both the parties as well as the facts on record, Section 11(1)(a) states that income derived from property held under trust wholly for charitable or religious purposes is exempt from tax only to the extent to which such income is applied to such purposes in India. The case of the department, as we see it, rests on the meaning of the phrase 'such income'. Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X
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