Safe Development Alms Trust Vs ACIT (Kerala High Court)
The Kerala High Court allowed the assessee trust’s appeal concerning whether the donations received by it constituted “anonymous donations.” The Assessing Officer and the statutory appellate authorities had concluded that the disputed amounts were anonymous donations, whereas the assessee contended that its returns contained the names, addresses and other necessary particulars of the contributors.
The assessee submitted that the authorities had ignored the details disclosed in the returns and had incorrectly treated the donations as anonymous. The Revenue disputed this contention, stating that the returns did not contain the names and addresses of the donors and referred to the assessment order, which recorded that the Managing Trustee had admitted that the institution was not maintaining a list of donors owing to a religious custom. The Revenue suggested that the matter be remitted to the First Appellate Authority for reconsideration of the factual dispute, and the assessee accepted this course.
The High Court observed that the dispute was purely factual, with both sides relying on the same documents while disagreeing on whether those records contained the names and addresses of the donors. The Court held that it was not appropriate to examine such factual issues at that stage and therefore found no necessity to admit the appeal or frame questions of law.
With the consent of both parties, the Court set aside the ITAT order and Annexure D and directed the First Appellate Authority to reconsider the statutory appeal solely on the question of whether the returns and records maintained and produced by the assessee contained the names and addresses of the alleged donors in respect of the disputed amounts. The Court clarified that the First Appellate Authority could either decide the matter itself or remit it to the Assessing Authority, but no further opportunity would be given to either side to produce additional documents, and the reconsideration would be confined to the existing records.
FULL TEXT OF THE JUDGMENT/ORDER OF KERALA HIGH COURT
The controversy in this case is confined within a very small compass, namely, if the donations shown by the assessee are anonymous or otherwise.
2. While the Assessment Officer and the Statutory Appellate Authorities have concluded that the amounts in question construe “anonymous donations”; the assessee maintains that the amounts involved have been disclosed, with all details of the contributors including names, addresses and other necessary credentials, in their returns.
3. Sri. Anil D. Nair, learned Senior Counsel, instructed by Sri.Aravind Sreekumar – learned counsel for the appellant, submitted that his client faces a rather difficult situation in this case because, even though the returns filed by them discloses every requisite detail with respect to the donations – including the names and identities of the donors – the Authorities have proceeded to turn a blind eye to it and then to hold that they are “anonymous donations”. He asserted that such factual findings are incorrect and contrary to law.
4. Sri. Jose Joseph – learned Senior Standing Counsel for the Department of Taxes, submitted that, what has been now stated by the learned Senior Counsel for the assessee is a new fact, which is not borne out from any of the records available. He insisted that the returns of the assessee did not include the names and addresses of the persons who allegedly made the donations; and pointed out to the Assessment Order to say that Sri.P.P.Unneenkutty – the Managing Trustee of the assessee had admitted that the institution was not maintaining a list of donors, explaining that it is a religious custom. He then made an alternative suggestion that, if this Court is inclined to consider the matter only qua the afore dispute, then the matter be remitted to the First Appellate Authority, with liberty reserved to it to evaluate the available records again and to take a decision, including as to whether any further orders are required to be issued to the Assessing Authority. This suggestion was accepted by Sri.Anil D. Nair also.
5. We find the afore submissions of Sri.Jose Joseph – learned Senior Standing Counsel to be the most apposite in the given circumstances because, when the disputations between the parties are in the realm of facts, it would be not proper for us to intervene at this stage, especially when both sides rely on the same documents – with one of them saying that it contains details of the donors; while the other asserting to the contrary.
6. Since our intent is as afore, obviously, we do not require to either admit this appeal, or to frame questions of law.
7. In such circumstances, with the consent of both sides, we allow this appeal and set aside the impugned order of the learned ITAT, as also Annexure D – clarifying that it is not because we have entered into their merits, or having found against it on merits; with a consequential direction to the First Appellate Authority to reconsider the statutory appeal filed by the assessee before it, but solely on the question whether the returns filed by them and the records maintained and produced, contain the names and addresses of the alleged donors, qua the disputed amounts.
8. Needless to say, the First Appellate Authority will have the liberty of taking a final decision on its own, or in remitting the matter to the Assessing Authority, depending up on its decision in due course.
We clarify that, when the afore exercise is completed, no further opportunity will be given to either of the sides to produce additional documents; and that the First Appellate Authority will confine its consideration on the available records.
