Jan Kalyan Samiti Vs ITO (ITAT Delhi)
This appeal was filed by the assessee against the order dated 17.07.2025 passed by the Commissioner of Income-tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi, for Assessment Year 2015–16.
The assessee, a society registered under Section 12AA of the Income Tax Act, 1961, filed its return of income on 28.09.2015 declaring NIL income. The case was selected for scrutiny under CASS, and notices under Sections 143(2) and 142(1) were issued. During assessment proceedings, the Assessing Officer (AO) observed that the society had total receipts of Rs. 3,98,108/-, revenue expenditure of Rs. 2,17,867/-, and declared a surplus of Rs. 1,80,241/-.
The AO noted that the society sold agricultural land for Rs. 30,00,000/- and purchased 1,15,000 shares of RPL Capital Finance Limited for Rs. 69,00,000/- from M/s Rinkpi Finance & Consultants Pvt. Ltd. (RFCPL). The shares were purchased at Rs. 60/- per equity share, while the AO determined the fair market value at Rs. 34/- per share. According to the AO, this resulted in an excess payment of Rs. 26/- per share, totaling Rs. 29,90,000/-.
Upon issuing notice under Section 133(6), the AO examined the shareholding pattern of RFCPL. It was observed that the President of the society, Shri Sanjeev Agarwal (HUF), held 11.66% shares in RFCPL, while the society itself held 14.18%. Additionally, another member, Shri Rashmi Kant Mittal, was linked through other entities. Based on aggregated shareholdings, the AO concluded that specified persons controlled 37.84% of RFCPL. Invoking Section 13(2)(e) read with Section 13(3) of the Act, the AO denied exemption under Sections 11 and 12 and disallowed the entire investment of Rs. 69,00,000/-. The surplus of Rs. 1,14,891/- was also taxed as income.
