Mangottu Kavu Devaswom Vs ITO (ITAT Cochin)
Assessee, a temple trust under Malabar Devaswom Board, filed return declaring Nil income. AO completed assessment u/s 143(3) & added Rs.1,45,000 being cash deposits of specified bank notes during demonetisation, holding that Assessee failed to substantiate that cash represented vazhipadu collections. CIT(A) confirmed the addition, relying on the fact that the amount was not reflected in closing cash balance as on 08.11.2016.
Tribunal noted that Assessee had provided a plausible explanation that SBN deposits were temple vazhipadu collections & absence of documentary evidence alone could not justify rejection of such explanation for a temple trust. Tribunal held the explanation reasonable considering the nature of activities & directed AO to delete the addition. Appeal allowed.
FULL TEXT OF THE ORDER OF ITAT COCHIN
This appeal filed by the assessee is directed against the order of the Addl. / Joint Commissioner of Income-tax (Appeals) [“Addl.CIT(A)” for short] dated 24.02.2025 for the assessment year 2017-2018.
2. Briefly, the facts of the case are that the appellant is a trust, running an ancient temple coming under the Malabar Devaswom Board of State Government of Kerala. The appellant filed the return of income for the assessment year 2017-2018 disclosing Nil income on 30th March, 2019. Against the said return of income, the assessment was completed by the Income-tax Officer, Ward-5, Palakkad (hereinafter “the AO”) vide order dated 10th December, 2019, passed u/s.143(3) of the Income-tax Act, 1961 (hereinafter “the Act”) at a total income of Rs.1,45,000. While doing so, the AO brought to tax the cash deposits made in specified bank notes during the demonetization period, being the amount of vazhipadu collections, for failure of the appellant to produce documentary evidences to substantiate its claim.
