IN THE INCOME TAX APPELLATE TRIBUNAL
`SMC'
SMC' : NEW DELHI
DELHI BENCH `SMC
PANNU, VICE PRESIDENT
BEFORE SHRI G.S. PANNU,
No.1223/Del/2019
ITA No.1223/Del/2019
2016-17
Assessment Year : 2016-
M/s Kamla Nehru Public Vs. Deputy Commissioner of
School Society, Income Tax,
Near Community Centre, CPC, Bangalore.
Sector-46,
Sector-
Faridabad,
121 003.
Haryana 121
PAN : AABAK1483H.
(Appellant) (Respondent)
Appellant by : Shri Dinesh Kumar Aggarwal, CA.
Respondent by : Ms. Ekta Vishnoi, Senior DR.
Date of hearing : 24.09.2019
Date of pronouncement : 31.10.2019
ORDER
This appeal by the assessee is directed against the order of
learned CIT(A), Faridabad dated 17th December, 2018 which in turn has
arisen from the order of the Assessing Officer passed under Section
143(1) of the Income-tax Act, 1961 (in short `the Act') dated 19th June,
2017 for the assessment year 2016-17.
2. In this appeal, although assessee has raised multiple grounds of
appeal, but, essentially, the grievance emanates from the decision of
CIT(A) in upholding action of the Assessing Officer in denying
exemption to the assessee under Section 10(23C)(iiiad) of the Act in
the intimation passed under Section 143(1) of the Act dated 19th June,
2017.
2 ITA-1223/Del/2019
3. In order to appreciate the rival stands, the following discussion is
relevant. The appellant before me is a Society registered under the
Societies Registration Act, 1860 with the main objective of running
educational institution. It has been explained that assessee is running
an educational institution and it exists solely for educational purposes
and not for purposes of profit. It has also been brought out that the
aggregate annual receipt of the educational institution is `17,50,582/-,
which is within the limit prescribed for the purposes of exemption
under Section 10(23C)(iiiad) of the Act. Explaining the background of
the dispute, the learned representative of the assessee pointed out
that while filing the return of income, assessee had returned nil tax
liability on the plea that the surplus on account of educational
activities of `2,49,859/- was exempt from tax in view of Section
10(23C)(iiiad) of the Act. The Assessing Officer, while framing the
intimation under Section 143(1) of the Act, instead, treated the
aforesaid sum as taxable and accordingly, a tax liability of `96,280/-
has been raised. The CIT(A) has also affirmed the aforesaid action.
4. A perusal of the orders of authorities below reveal that the
primary reason weighing with the lower authorities was that in the
return of income filed, no specific claim for exemption has been made
under Section 10(23C)(iiiad) of the Act. In this context, it is noticeable
that the return of income was furnished by the assessee in Form No.5
instead of Form No.7, which was the correct Form in which the return
of income ought to have been filed. In this context, the stand of the
assessee has been that in view of Section 139(4C) of the Act read with
Section 10(23C)(iiiad) of the Act and Rule 2BC of the Income-tax Rules,
1962, all the requirements of the exemption under Section
10(23C)(iiiad) stand fulfilled and the prescribed Form for filing the
return of income was indeed Form No.7. Before the lower authorities
as well as before me, it has been explained by the assessee that the
PAN number allotted by the Department was in the status of an AOP
3 ITA-1223/Del/2019
and, as a consequence, the return was filed erroneously in Form No.5
although the correct Form was ITR 7. Since in Form No.5 there was no
specific column in order to enumerate the claim of exemption under
Section 10(23C)(iiiad), it could not be appropriately filled up. In the
aforesaid factual matrix, the CIT(A) proceeded to deny the exemption
on the ground that the same was not appropriately filled up in the
return of income, which is merely a technical error. Substantively
speaking, there is no dispute that the assertions of the assessee for its
entitlement for exemption under Section 10(23C)(iiiad) of the Act are
justified. Therefore, in my considered opinion, it would be in the
fitness of things that the exemption under Section 10(23C)(iiiad) of the
Act is allowed to the assessee. I direct accordingly.
5. In the result, the appeal of the assessee is allowed as above.
Decision pronounced in the open Court on 31st October, 2019.
Sd/-
PANNU)
(G.S. PANNU)
VICE PRESIDENT
VK.
Copy forwarded to: -
1. Appellant : M/s Kamla Nehru Public School Society,
Centre,Sector-46,
Near Community Centre,Sector-
Faridabad, Haryana 121 003.
2. Respondent : Deputy Commissioner of Income Tax,
Bangalore.
CPC, Bangalore.
3. CIT
4. CIT(A)
5. DR, ITAT
Assistant Registrar
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