Ita/330/2022 Of The Commissioner Of Income Tax v. M/S. Sri. Basaveshwar Veerashaiva Vidyavardhak Sangha

Digitally signedby BHARATHISLocation: HIGHCOURT OFKARNATAKA NC: 2024:KHC:40421-DBITA No. 330 of 2022 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 27 DAY OF SEPTEMBER, 2024 PRESENT THE HON'BLE MR JUSTICE S.G.PANDIT AND THE HON'BLE MR JUSTICE C.M. POONACHA INCOME TAX APPEAL NO. 330 OF 2022 BETWEEN: 1. THE COMMISSIONER OF INCOME TAX, CIT(A) EXEMPTIONS, UNITY BUILDING ANNEXE, MISSION ROAD, BENGALURU-560 027. 2. THE DEPUTY COMMISSIONER OF INCOME-TAX CENTRAL CIRCLE-2(2), PRESENT ADDRESS, ACIT, CIRCLE-1, EXEMPTIONS, UNITY BUILDING ANNEXE, MISSION ROAD, BENGALURU-560027. …APPELLANTS (BY SRI. DILIP.M., ADV. A/W SRI. RAVI RAJ Y.V., ADV.) AND: M/S. SRI. BASAVESHWAR VEERASHAIVA VIDYAVARDHAK SANGHA HUNGUND ROAD, BAGALKOT-587 101, PAN AAAAB 2169A …RESPONDENT (BY SRI. CHANDRASHEKAR.V., ADVOCATE) THIS ITA/INCOME TAX APPEAL IS FILED UNDER SEC.260-A OF INCOME TAX ACT 1961, ARISING OUT OF ORDER DATED 28/12/2021 PASSED IN ITA NO.63/BANG/2018 FOR THE ASSESSMENT YEAR 2011-2012 PRAYING TO FORMULATE THE SUBSTANTIAL QUESTIONS OF LAW STATED THEREIN AND ETC. THIS APPEAL, COMING ON FOR HEARING, THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER: CORAM: HON'BLE MR JUSTICE S.G.PANDIT and HON'BLE MR JUSTICE C.M. POONACHA ORAL JUDGMENT (PER: HON'BLE MR JUSTICE S.G.PANDIT) Heard the learned counsel Sri. Dilip.M., along with Sri. Raviraj.Y.V., learned counsel for the appellants/Revenue and Sri. V.Chandrashekar, learned counsel for the respondent/assessee. 2. The Revenue is in appeal under Section 260-A of the Income Tax Act, 1961 (for short ‘the Act’) questioning the correctness and legality of order dated 28.12.2021 passed by the Income Tax Appellate Tribunal, ‘A’ Bench, Bengaluru (for short ‘Appellate Authority’) in ITA.No.63/Bang/2018 for the assessment year 2011-12. 3. This Court, admitted the appeal on 23.01.2023 to consider the following substantial questions of law: 1.Whether, on the facts and in the circumstances of the case and law, orders passed by CIT(A) and Tribunal are perverse in nature as both authorities the case and law, orders passed by CIT(A) and Tribunal are perverse in nature as both authorities erred in holding that additions made in assessment orders are not bases on any incriminating materials found during course of search ignoring that assessing authority based assessment order on the seized documents evidencing collection of capitation fee over and above the prescribed fee from students in other assessment years and found that the same was not accounted in the books of accounts of the assessee?orders are not bases on any incriminating materials found during course of search ignoring that assessing authority based assessment order on the seized documents evidencing collection of capitation fee over and above the prescribed fee from students in other assessment years and found that the same was not accounted in the books of accounts of the assessee? 2.Whether, on the facts and in the circumstances of the case and law, Tribunal and CIT(A)’s order can be said as perverse in nature in holding that assessee is entitled for exemption under section 11 of the Act even when the assessee is involved in carrying providing education on commercial bases against to principles laid down by Hon’ble Apex Court in case of T.M.A Pai?the case and law, Tribunal and CIT(A)’s order can be said as perverse in nature in holding that assessee is entitled for exemption under section 11 of the Act even when the assessee is involved in carrying providing education on commercial bases against to principles laid down by Hon’ble Apex Court in case of T.M.A Pai? 3.Whether on the facts and in the circumstances of the case, the Tribunal’s and CIT(A)’s orders are perverse in nature in deleting additions made in respect of case, the Tribunal’s and CIT(A)’s orders are perverse in nature in deleting additions made in respect of 3.Whether on the facts and in the circumstances of the case, the Tribunal’s and CIT(A)’s orders are perverse in nature in deleting additions made in respect of case, the Tribunal’s and CIT(A)’s orders are perverse in nature in deleting additions made in respect of unexplained receipts/unnamed donation when same is based on incriminating materials found during course of search?is based on incriminating materials found during course of search? 4.Whether on the facts and in the circumstances of the case, the Tribunal and CIT(A) failed to observe that in Section 153A does not stipulate that additions in assessment order are to be based on incriminating materials and as such Tribunal ought to have considered the case on merits?case, the Tribunal and CIT(A) failed to observe that in Section 153A does not stipulate that additions in assessment order are to be based on incriminating materials and as such Tribunal ought to have considered the case on merits? 4. Learned counsel for the assessee submits that the tax effect in this appeal is less than Rs.2 Crores and therefore, the appeal should not be entertained at the instance of the revenue in view of the Circular No.09/2024 dated 17.09.2024 issued by the Central Board of Direct Taxes. It is also submitted that the aforesaid Circular binds the revenue. 5. On the other hand, learned counsel for the revenue submits that he be granted liberty to revive the appeal in case the matter falls within the exceptions under - 6 - the aforesaid Circular dated 17.09.2024 and Circular No.5/2024 dated 15.03.2024. 6. In view of the aforesaid submissions, the appeal is disposed of with liberty as prayed for by the learned counsel for the revenue. However, the question of law is kept open to be adjudicated in an appropriate proceeding. Sd/- (S.G.PANDIT) JUDGE Sd/- (C.M. POONACHA) JUDGE