IN THE INCOME TAX APPELLATE TRIBUNAL DELHI 'C' BENCH BEFORE SHRI A.N. PAHUJA, AM & SHRI C.M. GARG, JM
ITA No.3635 /Del/2012
Assessment year: 2009-10
ADIT (E)TC-II, New Delhi V/s. Indian Evangelical Team 126, Andheria Modh,
[PAN : AAATI 0283 M )
Assessee by Shri George Koshi,AR
Revenue by Shri R.I.S. Gill, DR
Date of hearing 11-09-2012
Date of pronouncement 11-09-2012
A.N.Pahuja:- This appeal filed on 11.07.2012 by the Revenue against an order dated 02.04.2012 of the learned CIT(A)-XXI, New Delhi, raises the following grounds:-
1 "On the facts and in the circumstances of the case and fin law, the learned CIT(A) has erred in allowing exemption u/s 11 of the Income-tax Act, 1961 which was denied by the Assessing Officer because the assessee society is set up for religious activities while claiming charitable status which is clear violation of section 13(1)(b) of the Income-tax Act, 1961.
2. The appellant craves to add, to alter or amend any ground of the appeal raised above at the time of hearing."
2. Facts, in brief, as per relevant orders are that return declaring nil income filed on 22.09.2009 by the assessee, a society registered u/s 12A of the Income- tax Act, 1961 (hereinafter referred to as the 'Act') vide order dated 13.01.1977, 2 ITA no.3635/Del./2012
was selected for scrutiny with the service of a notice u/s 143(2) of the Act issued on 14.09.2010.During the course of assessment proceedings, the Assessing Officer (A.O. in short), on perusal of the Memorandum of Association of the society noticed that the preamble reads as under; "this is a charitable society for the fellowship of full gospel preaching Christian workers formed for the spiritual unity, establishing worshipping centres, social institutions and to strengthen mutual co-operation for the evangelization of north- India."
2.1 In the light of aforesaid objects, the AO was of the opinion that the activities of the society were geared for the benefit of Christian religion, in violation of provisions of section 13(1)(b) of the Act. In response to the show cause notice issued by the AO, the assessee replied that the AO, in the assessment orders for the AYs 1989-90 to 1991-92, himself allowed exemption u/s 11 of the Act while in AYs 1992-93 to 1994-95,2005-06 & 2007-08, the CIT(A) concluded that the assessee was entitled to exemption u/s 11 of the Act. Accordingly, while referring to the principles of consistency, the assessee sought exemption u/s 11 of the Act However, the AO did not accept the submissions of the assessee and while referring to findings in the assessment order for the AY 2008-09 concluded that the objects of the society were admixture of religious and other objects, falling within the mischief of provisions of sec. 13(1)(b) the Act. Accordingly, while referring to decisions in State of Kerala Vs. M.P. Shanti Verma Jain (1998) 231 ITR 787 (SC) & Ghulam Mohidin Trust Vs. CIT (2000) 248 ITR 587 (J&K), the AO determined taxable income of ``7,70,53,376/-.
3. On appeal, the ld. CIT(A) ,following the decision of the ITAT in the assessee's own case for the AY 2008-09 allowed the claim of the assessee in the following terms:-
"2.2 I have gone through the order of AO and written submission of the Ld. AR In this regard, the Hon'ble Tribunal in its latest order for A.Yr.2008-09 in appellant's own case has decided the issue in favour of the appellant following the decision taken for A.Y.2005-06 3 ITA no.3635/Del./2012
in appellant's own case by ITAT, the relevant para NO.6 & 7 are reproduced as under:-
"6. An identical issue has been decided by the ITAT, Delhi Bench 'C', New Delhi in the assessee's case for the Assessment Year 2005- 06 after following the earlier decisions of the Appellate Tribunal passed in assessment Years 1992-93, 1993-94 and 1994-95. The operative portion of the Tribunal's order dated 18.06.2009 passed in Assessment Year 2005-06 in ITA No.45/Del/20-09, is as under:-
3. We have considered the contention of the learned DR and gone through the orders of the authorities below and found from the record that for AY 1992-93, 93-94 and 94-95 the AO held that the assessee was a religious society and therefore, was not eligible for the tax exemption contained in section 11 of the act. On appeal, the CIT(A) vide his orders dated 2.8.1993 for AY 1992-93, 12.6.1996 for AY 1993-94 and 21. 7.1997 for AY 1994-95 held that the assessee was entitled to tax exemption u/s.11 of the Act. On second appeal by the department for AY 1992-93, 1993-94 and 1994-95, the ITAT confirmed the order of the CIT(A) vide orders dated 9,4.2001 for AY 1992-93, 16,1.2002 for AY 1993-94 and 13.9.2002 for AY 1994-95 and allowed tax
exemption under section 11 to the assessee. During the year also, the AO has denied exemption only on the ground that it is a religious society. As the facts and circumstances during the year under consideration are in pari-materia with the facts discussed by the Tribunal in its order dated 9.4.2011 for, AY 1992-93, 16.1.2002 for AY 1993-94 and 13.9.2002 for AY 1994-95, respectfully following the same, we do not find any infirmity the order of the CIT(A)."
The Assessing Officer has also stated in his order that identical issue was decided in favour of the assessee by the Tribunal but the Department has field an appeal before the Hon'ble High Court, hence the matter is pending adjudication. However, the fact emerges that as the position stands today, the matter has been decided in favour of the assessee by the Tribunal, which is to be following in the present assessment year.
4 ITA no.3635/Del./2012
7. Respectfully following the aforesaid Tribunal's order passed in assessment year 2005-06, we are inclined to uphold the order of the learned CIT(A) in granting exemption u/s 11 of the Act. Thus, the order of the learned CIT(A) is upheld."
2.3 As facts of the case are identical and issue is covered by the decision of the Hon'ble ITAT as discussed above, ground Nos.2 to 5 are allowed."
4. The Revenue is now in appeal before us against the aforesaid findings of the ld. CIT(A).The ld. DR supported the order of the AO while the ld. AR on behalf of the assessee relied upon the findings of the ld. CIT(A).
5. We have heard both the parties and gone through the facts of the case. We find that the AO himself accepted the claim of the assessee for exemption u/s 11 of the Act in the AYs 1989-90 to 1991-92,1995-96 to 2004-05 &2006-07 in identical circumstances. In the AY 1992-93, though a similar claim for exemption was disallowed, the ld. CIT(A) allowed the claim and the ITAT upheld the findings of the ld. CIT(A). On further appeal, the question of law formulated by Hon'ble High Court is stated to be pending in I.T.A. No. 6/2002. In the AY 1993-94, AO rejected the claim and appeal is stated to be pending in I.T.A. no.216/2002. For the AY 1994-95, the ITAT upheld the findings of the ld. CIT(A), allowing the claim for exemption u/s 11 of the Act and the appeal filed before the Hon'ble High Court is stated to be pending admission. In AY 2005-06, the AO again denied exemption for violation u/s13(1)(b) of the Act. However, on appeal, the ld. CIT(A) allowed the claim and the ITAT upheld the findings of the ld.CIT(A) vide their order dated 18th June, 2009 in I.T.A. no.45/Del./09. In the AYs 2007-08 & 2008- 09, though the AO denied exemption u/s 11 of the Act ,the ld CIT(A) allowed the claim of the assessee in the AY 2007-08 and the fate in further appeal is not known while in the AY 2008-09, the ITAT vide their order dated 26th December, 2011 in I.T.A. no.4671/Del./2011 upheld the findings of ld. CIT(A), granting exemption u/s 11 of the Act. The ld. CIT(A) in the impugned order followed this order of the ITAT for the AY 2008-09 in allowing exemption u/s 11 of the Act. In 5 ITA no.3635/Del./2012
view of the foregoing, especially when the Revenue have not placed any material before us, controverting the aforesaid findings of the ld. CIT(A) nor brought to our notice any contrary decision, so as to enable us to take a different view in the matter while claim of the assessee for exemption has consistently been allowed in the preceding years, we are not inclined to interfere. Consequently, ground no.1 in the appeal is dismissed.
6.. No additional ground having been raised before us in terms of residuary ground no.2 in the appeal, accordingly, this ground is dismissed.
7. In result, appeal is dismissed.
Order pronounced in open Court
Sd/- Sd/- (C.M. GARG) (A.N. PAHUJA) (Judicial Member) (Accountant Member)
Copy of the Order forwarded to:-
2. ADIT (E)TC-II, New Delhi
3. DIT(E),New Delhi
4. CIT (A)-XXI, New Delhi
5. DR, ITAT,'C' Bench, New Delhi
6. Guard File.