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Joint Commissioner of Income Tax, Range-1, Aayakar Bhavan, 3rd floor, Plot No. A-2D, Sector-24, NOIDA 201 301 (U.P.) Vs. M/s Nitya Educational Society, B-43, Sector-56, Noida, Gautambudh Nagar
June, 17th 2015
                                                      ITA NOS. 6048 & 6049/Del/2013


              IN THE INCOME TAX APPELLATE TRIBUNAL
                    DELHI BENCH "E", NEW DELHI
              BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER
                                  AND
               SHRI J.S. REDDY, ACCOUNTANT MEMBER
                       I.T.A.Nos.6048 & 6049/Del/2013
                          A.YRS. : 2002-03 & 2003-04
Joint Commissioner of Income              M/S NITYA EDUCATIONAL
Tax,                                 VS. SOCIETY,
Range-1, Aayakar Bhavan,                  B-43, SECTOR-56, NOIDA,
3rd floor, Plot No. A-2D,                 GAUTAMBUDH NAGAR
Sector-24,
NOIDA ­ 201 301 (U.P.)

(APPELLANT)                                   (RESPONDENT)


          Department by               :     Shri P. Dam Kanunjna, Sr. DR
           Assessee by                :     None

                      Date of Hearing : 15-06-2015
                      Date of Order       : 16-06-2015
                              ORDER
PER H.S. SIDHU : JM
     The Revenue has filed these Appeals against the                   separate
impugned Orders        both   dated       13.8.2013   passed      by    the   Ld.
Commissioner of Income Tax (Appeals), Noida.                Since the       issue
involved in     both the appeals           are common, hence, we are
disposing of the appeals by this consolidated order for the sake of
brevity, by dealing with the ITA No. 6049/Del/2013 (A.Y. 2003-04).

2.   The grounds raised in ITA No. 6048/Del/2013 (A.Y. 2002-03)
read as under:-

     1.           That the learned CIT(A) has erred in law in deleting
                  the penalty imposed at Rs.10,15,900/- u/s 271(1) (c)


                                      1
                                           ITA NOS. 6048 & 6049/Del/2013





     without appreciating the facts. which AO has
     discussed in assessment order at length.

2.   That the learned CIT(A) has erred in law by simply
     holding that since quantum appeal has been
     decided in favour of appellant assessee, the very
     basis of AO passing penalty order u/s 271(I)(c) also
     ceases    to     exist    and     deleted        the       penalty
     u/s 271 (I)(c) without appreciating that the revenue
     filed appeal against the order of the Hon'ble ITAT
     wherein following question of in brief emerges
     against the quantum appeal relief, namely:-

a)   Whether an in situation can be treated as an
     educational     institution     and     benefit      of        section
     1O(23C)(iiiad) of the Act be allowed thereto without
     affiliation to CBSE or any other Board.

b)   Whether the Hon'ble ITAT              is correct in allowing
     benefit of section IO(23C)(iiiad) to the assessee
     when it did not have any affiliation to the CBSE or
     any other, Board during the year and did not impart
     any educational activity during the year whereas in
     the   case     law   relied   upon      by    ITAT        of    Doon
     Foundation (1985) 154 ITR 208 (Cal), regular
     classes for teaching Hindi were held and income
     there from was considered within the purview of
     section 10(23C)(iiiad).

c)   Whether the assessee can be given the benefit of
     section 1O(23C)(iiiad) despite having no registration




                          2
                                                     ITA NOS. 6048 & 6049/Del/2013


                  u/s 12A as registration was granted on 29.9.2009
                  effective 30.3.2009, having no affiliation to CBSE or
                  any other Educational Board, having no educational
                  infrastructure, and   was also not conducting any
                  regular classes as in Doon Foundation.

     3.    That the appellant craves to leave, add, alter and amend
           any of the grounds of appeal on or before hearing.

     4.    The order of the Ld. CIT(A) deserves to be set aside and
           the order of the AO be restored.

3.   The grounds raised in ITA No. 6049/Del/2013 (A.Y. 2003-04)
read as under:-

      1.          That the learned CIT(A) has erred in law in deleting
                  the penalty imposed at Rs.2,51,664/- u/s 271(1) (c)
                  without appreciating the facts,            which AO has
                  discussed in assessment order at length.

     2.           That the learned CIT(A) has erred in law by simply
                  holding that since quantum appeal has been
                  decided in favour of appellant assessee, the very
                  basis of AO passing penalty order u/s 271(I)(c) also
                  ceases   to   exist    and     deleted        the     penalty
                  u/s 271 (I )(c) without appreciating that the revenue
                  filed appeal against the order of the Hon' ble ITAT
                  wherein following question of in brief emerges
                  against the quantum appeal relief, namely:-

     a)           Whether an in situation can be treated as an
                  educational   institution    and     benefit     of   section
                  1O(23C)(iiiad) of the Act be allowed thereto without
                  affiliation to CBSE or any other Board.

                                    3
                                                   ITA NOS. 6048 & 6049/Del/2013


     b)         Whether the Hon'ble ITAT       is correct in allowing
                benefit of section IO(23C)(iiiad) to the assessee
                when it did not have any affiliation to the CBSE or
                any other, Board during the year and did not impart
                any educational activity during the year whereas in
                the   case   law   relied   upon     by    ITAT    of    Doon
                Foundation (1985) 154 ITR 208 (Cal), regular
                classes for teaching Hindi were held and income
                there from was considered within the purview of
                section 10(23C)(iiiad).

     c)         Whether the assessee can be given the benefit of
                section 1O(23C)(iiiad) despite having no registration
                u/s 12A as registration was granted on 29.9.2009
                effective 30.3.2009 having no affiliation to CBSE or
                any other Educational Board, having no educational
                infrastructure, and    was also not conducting any
                regular classes as in Doon Foundation.

     3.   That the appellant craves to leave, add, alter and amend
          any of the grounds of appeal on or before hearing.

     4.   The order of the Ld. CIT(A) deserves to be set aside and
          the order of the AO be restored.

4.    The brief facts of the case are the return for assessment year
2003-04 was filed on 24.9.2003 declaring income at Rupees NIL.
On perusal of the Balance Sheet it was noticed that the assessee
Society during the year has received donation of Rs 8,85,600/.
Further during the assessment proceedings for A. Y. 2004-05, it was
seen that as per the balance sheet the assessee had shown corpus
fund of Rs. 42,79,700/- as on 1.4.2003. As per returns for A.Y 2002-
03 and 2003-04 and as per the details furnished during the

                                   4
                                               ITA NOS. 6048 & 6049/Del/2013


assessment proceedings, corpus fund of Rs 33,94,100/ and Rs
8,85,600/- was received during the period relevant to assessment
year 2002-03 and 2003-04 respectively. The entire corpus fund has
been received by the assessee in cash and evidence in this regard
could not be furnished by the assessee society. As the. income of
Rs 8,85,600/- had escaped assessment during. the A.Y. 2003-2004,
proceeding u/s 147 were initiated and assessment was completed
on an income Rs 8,85,600/- in the status of AOP U/S 143(3)/147 of
the Income Tax Act,1961 and exemption U/S 1O(23C) (iiiad) was not
allowed.     Assessing Officer noted that   in this case evidences of
escapement of income of Rs. 8,85,600/- for AY 2003-04 could be
detected only during the course of assessment proceedings under
section 143(3) for the AT 2004-05. If the case for AY 2004-05 would
not have been scrutinized above income of Rs. 8,85,600/- would not
have come in the tax net. Thus it is clear cut case, rather a case of
conscious concealment of income and of       furnishing incorrect and
inaccurate particulars of income, on which penalty 271(1)(c) is
attracted. Therefore, the AO held that the assessee had furnished
inaccurate particulars of income thereby concealed true particulars
of    such income and penalty u/s. 271(1)(c) is levaible in this case
and imposed a penalty of Rs. 2,51,664/- on the assessee vide his
order dated 1.3.2002.

4.1    Aggrieved with the penalty order, assessee appealed before
the Ld. CIT(A), who vide impugned order dated 13.8.2013 deleted
the penalty in dispute by allowing the appeals filed by the assessee.

5.     Now aggrieved with the impugned order, Revenue filed the
present Appeal before the Tribunal.

6.     Notice of hearing was issued by RPAD to the assessee for
15.6.2015. In response to the same neither the assessee nor its


                                   5
                                                    ITA NOS. 6048 & 6049/Del/2013


authorized representative appeared to prosecute its cases and nor
any application for adjournment was filed.      Keeping in view of the
facts and circumstances of the case, we are of the view that no
useful purpose would be served to issue notice again and again.
Therefore, we are proceeding exparte qua assessee, after hearing
the Ld. DR and perusing the records.

7.   At the time of hearing, Ld. DR relied upon the order of the AO
and reiterated the contention raised by the Revenue in the grounds
of appeal as well as the citations cited by the AO in the assessment
order and the penalty order.

8.   The assessee is a Society registered with Registrar of Society
with the object of setting up of an educational institution. In this
case, the assessee filed return of income for Assessment Year 2003-
04   on   24/9/2003   declaring     NIL   income.      Subsequently,        the
assessment was completed under section 143(3) of the Income-tax
Act on 31/10/2007 after making an addition of Rs. 8,85,600/- by
treating the voluntary contribution donations of Rs.8,85,600/-
credited to corpus account of the society as Revenue Receipts.
Subsequent to passing of above assessment order the A.O. on
consideration of facts and circumstances of the case initiated
penalty proceedings with respect to above addition and vide order
dated 01/03/2012 passed u/s. 271 (1)(c) of the I.T. Act., the A.O.
held that the assessee was guilty of furnishing inaccurate particulars
of such income and imposed penalty of Rs. 2,51,664/- u/s. 271(1)(c)
of the I.T. Act. Aggrieved with above order, the assessee was in
appeal before the Ld. CIT(A). During the appellate proceedings it has
been brought to the notice of Ld. CIT(A) that, aggrieved with above
Assessment Order      of   JCIT,   Noida, passed u/s. 143(3)             dated
31/10/2007 the assessee had filed appeal before CIT(A), Ghaziabad,
who vide his order dated 23/9/2010 in appeal No. 94/2007-08/GZB,




                                    6
                                                ITA NOS. 6048 & 6049/Del/2013


Noida had confirmed the action of A.O. and dismissed the appeal.
Aggrieved with the said decision of CIT(A), Ghazibad the assessee
filed second appeal with ITAT,         Delhi. The ITAT, Delhi after
considering the entire facts and circumstances of the case granted
the benefit of Section 10(23C)(iiiad) of the Income Tax Act to the
assessee vide order dated 29/2/2012 in appeal No. ITA Nos.1099 &
1100/0e1l2011.       Ld. CIT(A) further observed that in the light of
above decision of the ITAT, Delhi the assessee has contended that
since the very basis of penalty order uls 271 (1)(c) stands cancelled,
the penalty order passed uls 271(1)(c) by JCIT, Range Noida is Iiable
to be deleted. Thereafter, Ld. CIT(A) has considered the assessee's
submission and perused the order of ITAT, Delhi and after
considering the entire facts and circumstances of the case he was
agreed with the contention of the assessee that since the quantum
appeal has been decided in favour of the assessee assessee, the
very basis of A.O. passing penalty order u/s. 271(1)(c), also ceases
to exist and therefore, the penalty order passed by the AO turns
infructuous and thus deserves to be deleted, accordingly, the same
rightly was deleted vide     impugned order dated 13.8.2013 passed
by the Ld. CIT(A).

8.1   Keeping in view of the above facts and circumstances of the
case, we do not see any reason to interfere with the order of the Ld.
CIT(A), accordingly, we uphold action of the Ld. CIT(A) of deleting
the penalty of Rs. 2,51,664/- and decide the issue in dispute against
the Revenue by dismissing the Appeal filed by the Revenue.

ITA NO. 6048/DEL/2013 ((AY. 2002-03)

9.    Since the facts of this appeal are similar and identical to that
of ITA No. 6049/Del/2013 (AY 2003-04), as aforesaid. Therefore, in
the present Appeal bearing No. 6048/Del/2013 AY 2002-03) also we


                                   7
                                                  ITA NOS. 6048 & 6049/Del/2013


follow the same decision of confirming the action of the Ld. CIT(A) of
deleting the penalty made u/s. 271(1)(c), being similar and identical
facts.     Accordingly, in this case also the action of the Ld. CIT(A) of
deleting the penalty of Rs. 10,15,000/- is upheld and issue in dispute
is decided against the Revenue by dismissing the Appeal filed by
the Revenue.

10.      In the result, both the Appeals of the Revenue are dismissed.

         Order pronounced in the Open Court on 16/06/2015.

         Sd/-                                               Sd/-

[J.S. REDDY]                                         [H.S. SIDHU]
ACCOUNTANT MEMBER                                 JUDICIAL MEMBER

Date 16/06/2015

"SRBHATNAGAR"
Copy forwarded to: -
1.       Appellant -
2.       Respondent -
3.       CIT
4.       CIT (A)
5.       DR, ITAT
                              TRUE COPY
                                                     By Order,




                               Assistant Registrar, ITAT, Delhi Benches




                                     8
    ITA NOS. 6048 & 6049/Del/2013




9

 
 
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