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Income Tax Officer (E), Ward-1(4), Civic Centre, New Delhi Vs. M/s Mahavira Foundation, Sangam Park Extn., G. T. Karnal, Road, New Delhi-110033
September, 24th 2015
              DELHI BENCH `SMC-2', NEW DELHI
                    Before Sh. N. K. Saini, AM
            ITA No. 3383/Del/2015 : Asstt. Year : 2010-11
Income Tax Officer (E),           Vs M/s Mahavira Foundation,
Ward-1(4), Civic Centre,             Sangam Park Extn., G. T.
New Delhi                            Karnal, Road,
                                     New Delhi-110033
(APPELLANT)                          (RESPONDENT)
           Assessee by : Sh. Salil Kapoor & Vikas Jain, Advs.
           Revenue by : Sh. Yatendra Singh, Sr. DR

Date of Hearing : 23.07.2015      Date of Pronouncement : 23.09.2015

      This is an appeal by the department against the order
dated 31.03.2015 of ld. CIT(A)-40(Exemption), New Delhi.

2.    The only effective ground raised in this appeal reads as

     " 1. On the facts and in the circumstances of the case
     and in law, the Ld. CIT(A) has erred in not
     adjudicating the addition of the accumulated surplus
     of Rs. 14,94,507/- as income of the trust ignoring this
     fact that assessee failed to utilized the same within
     the specified time. "

3.    Facts of the case in brief are that the assessee filed the return of
income declaring Nil income on 30.09.2010. Subsequently, the assessee
                                    2                  ITA No. 3383/Del/2015
                                                        Mahavira Foundation

revised the return declaring Nil income on 17.10.2012. Later on, the case
was selected for scrutiny. During the course of assessment proceedings,
the AO noticed that the assessee was engaged in imparting education
and was running schools and educational institutions by the name of
Mahavir Senior Model School, Mahavir Junior Model School and
Mahavir Institute of Educational Training & Management. He further
observed that the society was registered u/s 12A(a) of the Income Tax
Act, 1961 (hereinafter referred to as the Act) and had also been granted
exemption u/s 80G of the Act vide order dated 25.07.2008 for the period
from 01.04.2008 to 31.03.2011. The AO also pointed out that the
assessee society was notified u/s 10(23)(vi) of the Act vide order dated
21.03.2011 for the assessment year 2010-11 onwards. The AO pointed
out that the assessee had accumulated funds of Rs. 14,94,507/- during
the financial year 2004-05 relevant to assessment year 2005-06 u/s 11(2)
of the Act and the funds so accumulated had to be utilized up to the
financial year 2009-10 relevant to assessment year under consideration
i.e. assessment year 2010-11 and since the assessee had not
utilized/applied the accumulated fund for the assessment year under
consideration to the tune of Rs. 14,94,507/-. He, therefore, disallowed
the same and considered it as deemed income. Accordingly, the addition
of Rs. 14,94,507/- was made.

4.   Being aggrieved the assessee carried the matter to the ld. CIT(A)
and submitted that the AO was not justified to make the addition of Rs.
                                    3                   ITA No. 3383/Del/2015
                                                         Mahavira Foundation

14,94,507/- u/s 11(2) of the Act as the assessee had already utilized or
applied the money up to the assessment year 2009-10 and there was no
violation u/s 11(3)(c) of the Act and the AO had also not pointed out any
specific amount, so it was just a general observation of the AO.

5.   The ld. CIT(A) after considering the submissions of the assessee
observed that the assessee had already utilized the additional
accumulated amount and no such amount was specifically pending in the
balance sheet for utilization and that apparently no proper case was
made out for making the addition by the AO. Accordingly, the impugned
addition was deleted.

6.   Now the department is in appeal. The ld. Counsel for the assessee
although supported the order of the AO but could not controvert the
findings given by the ld. CIT(A).

7.   In his rival submissions the ld. Counsel for the assessee strongly
supported the impugned order passed by the ld. CIT(A).

8.    I have considered the submissions of both the parties and perused
the material available on the record. In the present case, the explanation
of the assessee that the impugned amount had already been utilized up to
the assessment year 2009-10 and no such amount was specifically
pending in the balance sheet for utilization, has not been rebutted.
Therefore, I do not see any merit in this appeal of the department.
                                       4                   ITA No. 3383/Del/2015
                                                            Mahavira Foundation

9.       In the result, the appeal of the department is dismissed.
 (Order Pronounced in the Court on 23/09/2015)

                                               (N. K. Saini)
                                           ACCOUNTANT MEMBER
Dated: 23/09/2015
Copy forwarded to:
1. Appellant
2. Respondent
3. CIT
4. CIT(Appeals)
                                                     ASSISTANT REGISTRAR
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