(Per : HONOURABLE MR.JUSTICE V. M. SAHAI) 1. We have heard Mr. M.R. Bhatt, learned Senior Standing Counsel assisted by Mrs. Mauna M. Bhatt, learned Standing Counsel appearing for the revenue.
2. These five Tax Appeals have been filed under Section 260A of the Income-tax Act, 1961 (for short the Act) by the Revenue for the Assessment Years 2001-2002, 2002-03, 2004-05, 2005-06 and 2006-07 respectively, challenging the common judgment and order dated 28.1.2011 passed by the Income Tax Appellate Tribunal, Ahmedabad Bench “C” in IT (SS) A Nos.474 to 478/Ahd/2010.
2.1 The brief facts giving rise to the present appeals are that the assessee is a religious Trust carrying the activity of Jain temple, Jain Upashray and Jain Pathshala. Their activities were restricted to a particular community. The assessee had claimed exemption under Section 11 of the Act. The exemption claimed by the assessee was disallowed by the Assessing Officer by order dated 30.12.2009 on the ground that only religious activities are carried out by the Trust for a particular religious community and hence, the Trust cannot be said to be a public charitable trust as no activity was done by the Trust for public at large.
2.2 Being aggrieved by the order of the Assessing Officer, the assessee preferred appeals being Appeals No.333 and 334 of 2010 before the Commissioner of Income-tax (Appeals) (for short CIT (Appeals). The CIT (Appeals) decided the appeals on 19.2.2010 wherein finding was recorded that Trust Deed dated 22.2.1999 establishes that the Trust was established for the purpose of construction and maintenance of Jain institutions like Gyanshala, Pathshala, Upashraya, make arrangement for Jain Sadhu / Sadhwis, religions activities relating to Jain Shwetamber Murti Pooja, research relating to the literature on Jainism and lectures, discussion of Jain Gurus etc. For construction of Jain Derasar, the assessee has made expenditure of Rs.11,87,900/- in the assessment year 2001-2002. No part of the expenditure was for the benefit of any private individual but it was for the public at large. The CIT (Appeals) was of the view that the Assessing Officer has failed to appreciate that Section 13(1)(a) is applicable in cases where the Trust is running for private religious purpose, whereas Section 13(1)(b) is applicable to cases of a Trust for charitable purposes or charitable institutions after 1961 and income thereof is for the benefit of any particular religious community or caste. Therefore, Section 13(1)(b) was applicable to the facts of the case as the Trust was purely for charitable purpose. The CIT (Appeals) has also relied on the decision of this Court in CIT v. Barkate Saifiyah Society [213 ITR 492] (Gujarat). Therefore, according to the CIT (Appeals), the assessee being a charitable and registered Trust was entitled to exemption under Sections 11 and 12 of the Act. The CIT (Appeals) deleted the additions made by the Assessing Officer for the assessment years 2002-02 and 2002-03 respectively.
2.3 Being aggrieved by the said order of the CIT (Appeals), the Revenue preferred Second Appeals before the Appellate Tribunal. The Appellate Tribunal has by common judgment and order dated 28.1.2011 upheld the finding of fact recorded by the CIT (Appeals) and has upheld the deletion of additions.
3. It is this common order which is challenged in the present group of five Tax Appeals.
4. TAX APPEAL NOS.974 & 975 of 2011 41. In these Tax Appeals for the Assessment Years 2001-02 and 2002-03, the Revenue has proposed the following substantial questions of law for the determination and consideration of this Court :-
TAX APPEAL NO.974 OF 2011 “[A] Whether the Appellate Tribunal is right in law and on facts in deleting the disallowance of deduction of Rs.11,87,900/- under Section 11 of the I.T. Act ?
[B] Whether the Appellate Tribunal is right in law and on facts in deleting the disallowance of Rs.6,49,000/- under Section 11(1)(d) of the Act ?”
TAX APPEAL NO.975 OF 2011 “[A] Whether the Appellate Tribunal is right in law and on facts in deleting the disallowance of deduction of Rs.2,82,516/- under Section 11 of the I.T. Act ?”
4.2 We have gone through the order passed by the Tribunal. In our opinion, the CIT (Appeals) has recorded a finding that donations received by the Trust were towards the corpus. This finding has also been affirmed by the Appellate Tribunal. We agree with the finding of the Tribunal. Hence, in our opinion, the questions proposed by the revenue do not raise any question of law, much less any substantial questions of law for the consideration of this Court. The questions are based on findings of fact and hence, both the Tax Appeals fail and are accordingly dismissed.
5. TAX APPEAL NOS.976 & 977 OF 2011
5.1 In these Tax Appeals for the Assessment Years 2004-05 and 2005-06, the Revenue has proposed the following substantial questions of law for the determination and consideration of this Court :-
TAX APPEAL NO.976 OF 2011 “[A] Whether the Appellate Tribunal is right in law and on facts in deleting the disallowance of deduction of Rs.7,85,439/- under Section 11 of the I.T. Act ?
[B] Whether the Appellate Tribunal is right in law and on facts in deleting the addition made on account of unaccounted income of of Rs.3,51,000/- ?”
TAX APPEAL NO.977 OF 2011 “[A] Whether the Appellate Tribunal is right in law and on facts in deleting the addition made on account of unaccounted income as per seized documents of Rs.56,52,496/- ?
[B] Whether the Appellate Tribunal is right in law and on facts in directing to allow deduction under Section 11 of the I.T. Act ?”
5.2 We have gone through the order passed by the Tribunal. In our opinion, the CIT (Appeals) has recorded a finding that donations received by the Trust were towards the corpus. This finding has also been affirmed by the Appellate Tribunal.
5.3 On the second proposed question, the Appellate Tribunal has recorded finding of fact in paragraph 13 of its judgment which is extracted below :-
“13. We have heard both the parties and gone through the facts of the case. As is apparent from the aforesaid findings of the ld. CIT(A), since the amounts mentioned in the seized documents were found to be recorded in the regular books of accounts while returns for the aforesaid three assessment years based on the said books were filed much before the search and the ld. CIT(A) duly confronted the additional evidence submitted before him to the AO, we are not inclined to interfere. The ld. DR did not place any material before us, controverting the aforesaid findings of the ld. CIT(A). In the absence of any material, there is no basis for taking a different view in the matter. Therefore, ground No.4 in the appeals for the AYs. 2004-05 to 2006-07 is dismissed.”
5.4 We agree with the finding of the Appellate Tribunal. In our opinion, the questions proposed by the revenue do not raise any question of law, much less any substantial questions of law for the consideration of this Court. The questions are based on findings of fact and hence, both the Tax Appeals fail and are accordingly dismissed.
6. TAX APPEAL NO.978 OF 2011
6.1 In this Tax Appeal for the Assessment Years 2006-07, the Revenue has proposed the following substantial questions of law for the determination and consideration of this Court :-
TAX APPEAL NO.978 OF 2011 “[A] Whether the Appellate Tribunal is right in law and on facts in deleting the addition made on account of unaccounted income as per seized documents of Rs.70,63,263/- ?
[B] Whether the Appellate Tribunal is right in law and on facts in deleting the addition on account of unexplained cash credit of Rs.6,00,000/- ?”
6.2 We have gone through the order passed by the Tribunal. In our opinion, the CIT (Appeals) has recorded a finding that donations received by the Trust were towards the corpus. This finding has also been affirmed by the Appellate Tribunal.
6.3 So far as the first question is concerned, the Appellate Tribunal has recorded finding of fact in paragraph 13 of its judgment which is extracted below :-
“13. We have heard both the parties and gone through the facts of the case. As is apparent from the aforesaid findings of the ld. CIT(A), since the amounts mentioned in the seized documents were found to be recorded in the regular books of accounts while returns for the aforesaid three assessment years based on the said books were filed much before the search and the ld. CIT(A) duly confronted the additional evidence submitted before him to the AO, we are not inclined to interfere. The ld. DR did not place any material before us, controverting the aforesaid findings of the ld. CIT(A). In the absence of any material, there is no basis for taking a different view in the matter. Therefore, ground No.4 in the appeals for the AYs. 2004-05 to 2006-07 is dismissed.”
6.4 So far as the second proposed question is concerned, the Appellate Tribunal has recorded finding of fact in paragraph 17 of its judgment which is extracted below :-
“17. We have heard both the parties and gone through the facts of the case. As is apparent from the aforesaid findings of the ld. CIT(A), since the amounts mentioned in the seized documents were found to be recorded in the regular books of accounts and reflected in the audited accounts for the relevant years while return based on the said books was filed much before the search, we are not inclined to interfere. The ld. DR also did not place any material before us, controverting the aforesaid findings of the ld. CIT(A). In the absence of any material, there is no basis for taking a different view in the matter. Therefore, ground No.3 in the appeals for the AY 2006-07 is also dismissed.”
6.5 We agree with the finding of the Appellate Tribunal. In our opinion, the questions proposed by the revenue do not raise any question of law, much less any substantial questions of law for the consideration of this Court. The questions are based on findings of fact and hence, the Tax Appeal fails and it is accordingly dismissed.
7. In view of the above discussion, all the Tax Appeals are accordingly dismissed.
Sd/-
[V. M. SAHAI, J.] Sd/-
[N. V. ANJARIA, J.] Savariya