Case Law Details
CIT (Exemption) Vs Hamdard National Foundation (India) (Delhi High Court)
Facts- The AO, for the A.Y. 2007-08, had noted that the assessee had received donation from Hamdard Dawakhana (Wakf) amounting to ₹9,43,81,000/- and rental income of ₹46,41,028/-. In addition, the assessee had also received ₹20,00,00,000/- as corpus donation from Hamdard Dawakhana (Wakf) during the said A.Y.. Relying upon the enquiry made from one M/s CB Richard Ellis South Asia Private Limited and from the various websites, namely, makan.com; 99acres.com; magicbricks.com, the AO held that the property at Asaf Ali Road, New Delhi and Rajdoot Marg, Chanakyapuri, New Delhi, had been let out by the assessee to Hamdard Dawakhana (Wakf) at a much lower rate as compared to the market rate of rent and therefore, invoked the provisions of Section 13(2)(b) read with Section 13(3) of the Act.
Conclusion- In the present case, the AO, apart from relying upon some opinion of rent from property broker firms and websites, does not appear to have made any independent inquiry on the adequacy of the rent being charged by the respondent/assessee from Hamdard Dawakhana (Wakf). It is not shown that the AO made any independent inquiry on the age and condition of the building of the assessee situated at Asaf Ali Road, New Delhi. In fact, as contended by the learned senior counsel for the assessee and taken note of by the learned ITAT and not denied by the appellant/revenue, the property at Rajdoot Marg was not even ready during Assessment Year 2008-09 and was lying vacant. In the absence of any such inquiry by the AO, the invocation of Section 13(2)(b) of the Act was clearly flawed and rightly rejected by the learned ITAT.
FULL TEXT OF THE JUDGMENT/ORDER OF DELHI HIGH COURT
1. This batch of appeals is directed against the common order dated 01.11.2019 passed by the learned Income Tax Appellate Tribunal, Delhi Bench „C’, New Delhi (hereinafter referred to as the „learned ITAT’) in ITA No. 1640/Del/2019 (AY 2007-08); ITA No. 4789/Del/2012 (AY 2008-09); ITA No. 5411/Del/2012 (AY 2009-10); and ITA No. 3403/Del/14 (AY 2010-11), inter alia holding therein that there was no justification for the addition made by the Assessing Officer by invoking the provisions of Section 13(2)(b) read with Section 13(3) of the Income Tax Act, 1961 (hereinafter referred to as the „Act’) and consequently, directing deletion thereof.
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