COMMISSIONER OF INCOME TAX Vs. TIBETAN CHILDREN VILLAGE

JUDGEMENT

(1.) This order shall dispose of ITA Nos.327, 333, 334 and 395 of 2015 as according to the learned counsel for the appellant, the issue involved in all these appeals is identical. However, the facts are being extracted from ITA No.327 of 2015.

(2.) Ita No.327 of 2015 has been preferred by the appellant- revenue under Section 260A of the Income Tax Act, 1961 (in short, "the Act") against the order dated 6.2.2015, Annexure A.3 passed by the Income Tax Appellate Tribunal, Chandigarh Bench, 'B', Chandigarh (in short, "the Tribunal") in ITA No.601/Chd/2012 for the assessment year 2008-09 claiming following substantial questions of law:-

(3.) A few facts relevant for the decision of the controversy involved as available on the record of ITA No.327 of 2015 may be noticed. The respondent-assessee M/s Tibetan Children Village is a charitable institution established for the purpose of carrying out various activities such as providing education, vocational training etc. at different places. Return for the year ending 31.3.2008 declaring income at ' Nil was filed on 30.9.2008 after claiming exemption under section 11 of the Act. The return of income was accompanied with audited income and expenditure account and balance sheet etc. The case was processed under Section 143(1) vide order dated 15.1.2010 at the income returned by the assessee. However, the assessee revised its return again declaring income at nil on 13.4.2009 after claiming exemption under section 11 of the Act. The case was selected for scrutiny. Statutory notice under section 143(2) of the Act was issued to the assessee. Subsequently, notice under section 142(1) of the Act was also issued to the assessee on 29.10.2010. The assessee through its counsel appeared and filed reply. After considering the reply, while the Assessing Officer acknowledged utilization amounting to Rs. 38,29,20,160/- out of the earmarked funds during the year under consideration, he allowed expenditure of Rs. 21,36,235/- only to the appellant adopting the FIFO method clubbing the opening accumulated balance with the funds received during the year. The utilization out of the earmarked funds was 196.90% during the year under consideration and 87.07% out of the other corpus funds. According to the Assessing Officer, there was deficiency in application of fund for charitable purposes during the year under assessment amounting to Rs. 15,47,22,732/- and the same was added back to the taxable income of the assessee vide order dated 27.12.2010, Annexure A.1. Aggrieved by the order, the assessee filed appeal before the Commissioner of Income Tax (Appeals) Shimla [CIT(A)] which was allowed vide order dated 21.3.2012, Annexure A.2. Both the assessee as well as the department filed cross appeals before the Tribunal. Vide order dated 6.2.2015, Annexure A.3, the Tribunal dismissed the appeals of the revenue and disposed of the appeal of the assessee as infructuous. Hence the instant appeals by the revenue.