Case Law Details
DCIT Vs American School of Bombay Education Trust (ITAT Mumbai)
Conclusion: Assessee-American School of Bombay Education Trust was eligible for income tax exemption u/s. 10(22) as assessee had reasonable cause and justified the expenses claimed in the Income and Expenditure statement filed along with the return of income.
Held: AO noted that assessee-American School of Bombay Education Trust had not produced the books of account or documents to prove its claim of exemption made u/s. 10(22) that assessee-trust solely existed for educational purposes. He stated that even the Directorate of Enforcement made enquiries and pointed out certain inconsistencies. Even CBDT had rejected the application made by assessee u/s. 10(23C)(vi) and in absence of registration u/s. 12A of the Act, assessee was not entitled for exemption u/s. 11. Therefore, AO had rightly denied the claim of exemption to assessee u/s. 10(22). It was noted infamous flood hit occurred in Mumbai caused damages to the documents as well as various records, articles and goods lying in assessee’s premises which could be considered as a reasonable cause. Moreover, from the heads of expenses claimed in the Income and Expenditure statements, it was evident that these were the expenses which were necessarily required to have incurred for the purposes of running the school. Without incurring these expenses, it was not possible to run a school. Therefore, AO was not justified in disallowing the entire expenses claimed in the Income and Expenditure statement filed along with the return of income, merely on the ground that assessee could not furnish the details and supporting evidence.
FULL TEXT OF THE ITAT JUDGEMENT
This appeal by the Revenue and Cross Objection by assessee are arising out of the order of Commissioner of Income Tax (Appeals)-I, Mumbai, in appeal No. CIT(A)-I/IT-E2(88)/2013-14 vide dated 27-06-2014. The Assessment was framed by the Asst. Director of Income Tax(Exemption)-II(2), Mumbai for the AY 1998-99 vide order dated 28-03-2013 under section 143(3) read with section 253 of the Income Tax Act, 1961 (hereinafter ‘the Act’).
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