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× Latest Case Laws on Income Tax by various Income Tax Appellate Tribunals in India

These are the latest case laws decided by various Income Tax Appellate Tribunals (ITAT) of India on Income Tax which have been published recently. The case laws are open for discussion and we invite expert comments from our members on its applicability and effect on relevant issues.

08-03-2019, Care India Solutions, Section 12AA, 11, Tribunal Delhi

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2 months 1 week ago #8766 by amit
Section - 12AA, 11, 12, 2(15)
Order Date - 08-03-2019
Favouring - Assessee
Court - Tribunal Delhi
Appellant - ACIT
Respondent - Care India Solutions for Sustainable Development
Citation - 319Taxpundit213
Appeal No. - ITA.No.1248/Del./2016
Asstt. Year - 2011-2012



This appeal by Revenue has been directed against the order of Ld. CIT(A)-40, New Delhi, Dated 14th December, 2015, for the assessment year 2011-2012, on the following grounds :

1. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in allowing the appeal of the assessee by ignoring the fact that shortterm loan/advance from FCRA Account is a violation of provision of FCRA Guidelines.

2. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in allowing the appeal of the assessee by ignoring the fact that amounts were received by the assessee as commercial fee in its accounts. If the amount was to be received as donation or grant, the same should have been received through Foreign Contribution Regulation Account after obtaining permission from the Ministry of Home Affairs Government of India.

3. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in allowing the appeal of the assessee by ignoring the fact that assessee itself has accepted that in respect of projects, as claimed charitable by assessee, these projects are not for undertaking any charitable activity but for providing ancillary professional services to the agencies/Government Departments in undertaking the charitable activities.”

2. Briefly the facts of the case are that assessee is a Company registered under section 12AA of the Income Tax Act. The main objects of the assessee company are as under:

(i) To promote sustainable socio-economic development, poverty alleviation, livelihood creations & development, food security, environment protection, natural resources management & conservation, not with the motive of profit.

(ii) None of the objects of the Company will be carried out on commercial basis.

3. The A.O. had disallowed exemption under sections 11 and 12 of the Income Tax Act, as according to him, the assessee is covered by the proviso to amended definition in Section 2(15) of the I.T. Act. In arriving at its conclusion, he has made the following observations :

(a) “that the sum of Rs.21 lakhs, received from the State Govt. of Andhra Pradesh under an agreement towards SBI Micro-finance project in Prakasham Distt. (taken up to help the urban poor women by forming Self Help Groups (SHG) to enable their access to nationalized banks to actualize their entitlements for loans under the Govt. Scheme) was towards the professional services rendered by the assessee and not received as grant from Govt. and thus, assessable as "Income from Business & Profession”

(b)that there was violation of FCRA as some of the agencies were provided soft loans out of local and foreign contributions and there had been inward and
outward remittances out of such contributions.

(c) that, in the absence of documentary evidences and permission to send money abroad, the sum of Rs.69,13,554 paid for information & support services is disallowable.

(d)that there was no justification in paying 50% of the donation collections to M/s. Fundreamz engaged in the activity of donation raising for the assessee company (the sum of Rs.41,95,089 disallowed by the

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