The order of the Bench was delivered by
SUNIL KUMAR YADAV:-This appeal is preferred by the Revenue against the order of the ld. CIT(A) mainly on two grounds which are as under:-
(1) The Ld. CIT(Appeal)-!, Lucknow has erred in law in deleting the demand of Rs. 5,82,920/- raised by the Assessing Officer.
(2) The Ld. CIT(Appeals) has erred in law and on the facts of the case deleting the addition of Rs. 16,87,000/- made by the Assessing officer as unexplained cash credits under section 68 of I.T. Act,1961.
(3) The Ld CIT (Appeals) has erred in law and on facts of the case in holding that the Assessing officer has made addition on presumption without conducting proper enquiries and without recording proper satisfaction.
2. Ground No.1 does not emanate either from the order of the Assessing Officer or the ld. CIT(A), therefore, this ground is devoid of merit and we reject the same.
3. So far as ground No.2 is concerned, it is noticed that during the course of assessment proceedings the Assessing Officer has noted that the assessee-trust claimed to have received donation amounting to Rs. 19,10,400/-. All these donations were received in cash and the assessee was required to furnish the names and address of the donors. Assessee had furnished the list containing names and address of 250 persons, out of which 75 persons had given donations exceeding Rs. 10,000/- and the total of such donation comes to Rs. 18.50 lakhs. The Assessing Officer has issued a letter under section 133(6) of the Income-tax Act, 1961 (hereinafter called in short “the Act") to 20 such donors on test check basis. In response thereto, six persons have responded, from whom Rs. 1.28 lakhs was received. The Assessing Officer has further observed that rest of the persons have failed to furnish income-tax acknowledgement and source of cash donations. The Assessing Officer accordingly considered the donation of Rs. 1.28 lakhs received from six persons to be genuine and for the rest of the donation of Rs. 16.87 lakhs, he made addition after treating it to be unexplained cash credit.
4. The assessee preferred an appeal before the ld. CIT(A) and the ld. CIT(A) has re-examined the issue in the light of assessee’s contentions and the documents relating to the donors. It was contended that out of 75 persons, 20 persons have confirmed payment of donation and for the remaining 55 persons additions were made without making any enquiry; whereas the assessee has furnished complete details of all the donors along with their PAN. The ld. CIT(A) re-examined the claim of the assessee and being convinced with the explanations of the assessee, the ld. CIT(A) has deleted the addition having observed that while making addition under section 68 of the Act, satisfaction of the Assessing Officer has to be exercised qua each deposit, as the said section does not prescribe any ad hoc or estimated addition. He accordingly deleted the addition.
5. Aggrieved, the Revenue has preferred an appeal before the Tribunal and has placed reliance upon the order of the Assessing Officer whereas the ld. counsel for the assessee has contended that in case of a charitable society, no addition can be made under section 68 of the Act and in support of this preposition, the assessee has placed reliance upon the order of this Bench of the Tribunal in the case of ACIT-1, Kanpur vs. M/s Sahyog Jan Kalyan Samniti, Kanpur in I.T.A. No. 568 to 572/LKW/2013. Copy of the order is placed on record. Besides, our attention was also invited to the judgment of the Hon'ble Delhi High Court in the case of Director of Income Tax vs. Hans Raj Samarak Society in I.T.A. No. 534 of 2012. It was further contended that the assessee has furnished complete details i.e. name of the donors, address, PAN and amount given as donation. Therefore, in the light of complete details, the genuineness of the donations can be verified, but the Assessing Officer has made addition under section 68 of the Act.
6. Having carefully examined the orders of the lower authorities and the documents placed before us in the light of the rival submissions, we find that undisputedly the assessee has furnished complete details of the donors and the copy of the same is available at pages 9 to 12 of the compilation of the assessee, in which the name and address of the donor along with PAN was given. The Assessing Officer has invoked the provisions of section 68 of the Act while making the addition; whereas provisions of section 68 of the Act cannot be invoked in case of donation received by the society, as the receipts was taken into the total income of the assessee. This aspect was examined by this Bench of the Tribunal in the case of ACIT-1, Kanpur vs. M/s Sahyog Jan Kalyan Samniti, Kanpur (supra), in which the Tribunal has held that provisions of section 68 of the Act cannot be invoked for making addition. The relevant observations of the Tribunal are extracted hereunder for the sake of reference:-
“6. Having carefully examined the orders of the lower authorities in the light of the rival submissions and the judgments referred to by the parties, we find that the assessee has some force in his arguments on merit. The issue of addition u/s 68 of the Act on account of corpus donation is squarely covered by the order of the Tribunal pertaining to assessment year 2005-06 in which corpus donation was introduced under similar circumstances and the Tribunal has deleted the additions having observed that once a particular credit or donation is already declared by the assessee, the same cannot be added again. The relevant observation of the Tribunal are extracted hereunder:
“19. We have considered the rival submissions and perused the material on record. In our considered view, the addition in respect of donations of Rs. 1,13,00,308/-, addition of Rs. 1,00,000/-, addition of Rs. 46,71,371/- and addition of Rs. 8,35,000/- cannot be sustained again once it has been declared by the society as income/receipt. No double addition is called for. Even if a particular donation or credit cannot be proved and the assessee at the time of filing of the return declared the same as its income and further addition u/s 68 of such amount cannot be made. In this regard, we refer to the decision of the Hon'ble Delhi High Court in the case of DIT Exemption vs Keshav Social Charitable Foundation, 278 ITR 152 (supra), wherein it is held as under:
"The assessee was a charitable trust providing medical advice for needy people in various parts and remote villages of Uttar Pradesh. It was registered under section 12A of the Income-tax Act, 1961. For the assessment year 1991-92, the assessee claimed benefit under section 11 of the Act for the donations it received during the relevant previous year. The assessee had furnished the list of donors. The Assessing Officer disallowed the claim stating that the assessee could not furnish details regarding the donors and that it was just a way of introducing unaccounted money into the books of the assessee trust and thus treated the amount as cash credit under section 68 of the Act. The Tribunal held that since more than 75 per cent, of the donations received by the assessee was spent for charitable purposes, the addition was not justified. On appeal to the High Court :
Held, dismissing the appeal, that to obtain benefit of the exemption under section 11 of the Act, the assessee was required to show that the donation was voluntary. In the .present case, the assessee had not only disclosed its donations, but had also submitted a list of donors. The fact that the complete list of donors had not been filed or that the donors had not been produced did not necessarily lead to the inference that the assessee had tried to introduce unaccounted money by way of donation receipts, This was shown in the facts of the case, where admittedly 75% of the donations were applied for charitable purposes. Section 68 of the Act had no application to the facts of the case because the assessee had in fact disclosed the donations of Rs. 18,24,200/- as its income and it could not be disputed that all receipts, other than corpus donations would be income in the hands of the assessee. There was thus full disclosure of income by the assessee and also application of the donations for charitable purposes. It was not in dispute that the objects and activities of the assessee were charitable in nature since it was duly registered under the provisions of section 12A.
20. Similarly, the Hon'ble AP High Court in the case of CIT vs. Hyderabad Secunderabad Foodgrains Association Ltd, 175 ITR 574 (supra) has held as under:
"The Income-tax Officer denied exemption to the assessee under section 11 of the Income-tax Act, 1961, for the assessment year 1977-78. On appeal, the Commissioner of Income-tax (Appeals) held that the assessee was a public charitable institution and set aside the assessment with a direction to the Income-tax Officer to consider whether the assessee satisfied the requirements of sections 12, 12A and 13 of the Income-tax Act, 1961. The Tribunal held that the Commissioner of Income-tax (Appeals) ought not to have given the direction. On a reference:
Held, (i) that the provisions contained in section 11 concerning the exemption of a public charitable institution do not take automatic effect. They take effect subject to the fulfillment of the conditions specified in the other provisions such as sections 12, 12A and 13 of the Act. The Income-tax Officer did not go into these aspects because he refused the assessee's claim under section 11. But once the Commissioner of Income-tax (Appeals) held that the assessee was a public charitable institution, it was necessary to examine whether the conditions specified for exemption in sections 12, 12A and 13 were fulfilled. The Commissioner of Income-tax (Appeals) was justified in issuing the direction to the Income-tax Officer to do so;
(ii) that the Tribunal was under an obligation to consider all the pleas raised in the appeal.
21. The Hon'ble Supreme Court in the case of Program for Community Organisation, 248 ITR 01, has held that where trust received donations and applied for charitable purposes then assessee is entitled to accumulate 25% of such donation received. In the case of DIT (Exemption) vs Bharat Kalyan Pratishthan, 257 ITR 609( Delhi), it was held that when donation received in earlier years by the trust were accepted as applied for charitable purposes then there is no reason to hold differently in the current year.
22. Thus, once a particular credit or donation is already declared by the assessee, the same cannot be added again. Since the facts of receipt of these amounts having been declared as income/receipt by the assessee are not in dispute, we uphold the order of the Ld. CIT(A) in deleting the addition in respect of these amounts. This disposes of grounds of Revenue relating to additions of Rs. 1,13,00,038/-, Rs. 1,00,000/-, Rs. 8,35,000/- and Rs. 46,71,371/-.”
6.1 The view taken by the Tribunal was confirmed by Hon'ble Jurisdictional High Court in Income-tax Appeal No.267/2009. Copy of the judgment is placed on record. Since the Tribunal has taken a particular view in similar set of facts, we find no reason to take a contrary view in these appeals. Moreover, the CIT(A) has properly adjudicated the issue in the light of various judicial pronouncements and we find no infirmity therein. We, therefore, confirm his order in this regard.”
7. During the course of hearing, an argument was also raised that if the provisions of section 68 of the Act cannot be invoked, disallowance can be made by invoking the provisions of section 115BBC of the Act, as the details of the donors are not available. This aspect was also examined by the Tribunal in the aforesaid case and the Tribunal has held that when the details of donors are filed, the donation cannot be called to be anonymous donation. The relevant observations of the Tribunal are extracted hereunder for the sake of reference:-
“10. Having carefully examined the orders of the lower authorities and the relevant provisions of the Act, we find that after introduction of section 115BBC, the unanimous donation received by the assessee is also taxable in the hands of the recipient trust. The unanimous donation has also been defined in sub section (3) of section 115BBC of the Act. For the sake of reference, we extract section 115BBC of the Act as under:
“115BBC. Anonymous donations to be taxed in certain cases. (1) Where the total income of an assessee, being a person in receipt of income on behalf of any university or other educational institution referred to in sub-clause (iiiad) or sub-clause (vi) or any hospital or other institution referred to in sub-clause (iiiae) or subclause (via) or any fund or institution referred to in subclause (iv) or any trust or institution referred to in subclause (v) of clause (23C) of section 10 or any trust or institution referred to in section 11, includes any income by way of any anonymous donation, the income-tax payable shall be the aggregate of-
(i) the amount of income-tax calculated on the income by way of any anonymous donation, at the rate of thirty per cent. ; and
(ii) the amount of income-tax with which the assessee would have been chargeable had his total income been reduced by the amount of income referred to in clause (i).
(2) The provisions of sub-section (1) shall not apply to any anonymous donation received by-
(a) any trust or institution created or established wholly for religious purposes ;
(b) any trust or institution created or established wholly for religious and charitable purposes other than any anonymous donation made with a specific direction that such donation is for any university or other educational institution or any hospital or other medical institution run by such trust or institution.
(3) For the purposes of this section, “anonymous donation” means any voluntary contribution referred to in sub-clause (iia) of clause (24) of section 2, where a person receiving such contribution does not maintain a record of the identity indicating the name and address of the person making such contribution and such other particulars as may be prescribed.”
10.1 As per sub section (3), unanimous donation are those donations for which no details of donors are maintained by the assessee. If the details are maintained, the donations cannot be called unanimous donation and provisions of section 115BBC cannot be invoked. In the instant case, undisputedly, the details were maintained by the assessee but the addition was made on account of non furnishing the confirmation letters. We are of the considered view that only those donations can be called unanimous for which details are not maintained. If it is properly maintained, it cannot be called unanimous donation. Since the assessee has maintained the details of donors, the donations cannot be called unanimous donation and provision of section 115BBC cannot be invoked in the given facts and circumstances of the case. If provision of section 115BBC cannot be invoked, the addition made u/s 68 are to be deleted in the light of the order of the Tribunal in assessee’s case for assessment year 2005-06 and the judgment of Hon'ble High Court in which under the identical facts, the additions made by the Revenue u/s 68 on account of unexplained corpus donation were deleted. We accordingly set aside the order of CIT(A) and delete the addition.”
8. In other cases also similar view was expressed by the Tribunal. In the instant case, since the assessee has furnished complete details of the donors along with PAN, the said donation cannot be called to be anonymous donation. Therefore, provisions of section 115BBC of the Act cannot be invoked. Keeping in view the totality of the facts and circumstances of the case, we are of the considered opinion that no disallowance can be made either under section 68 of the Act or under section 115BBC of the Act. Therefore, we find no infirmity in the order of the ld. CIT(A) who has rightly deleted the addition.
9. In the result, appeal of the Revenue is dismissed.