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03-07-2019, Himachal Pradesh Board, Section 10(23C)(iiiab), Tribunal Chandigarh

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3 months 1 week ago #9972 by amit
Section - 10(23C)(iiiab), 12AA, 131
Order Date - 03-07-2019
Favouring - Assessee allowed for statistical purpose
Court - Tribunal Chandigarh
Appellant - Himachal Pradesh Board of School Education
Respondent - DCIT
Citation - 719Taxpundit61
Appeal No. - ITA Nos. 66, 67 & 68/CHD/2018
Asstt. Year - 2004-05, 2005-06 & 2007-08



By these three appeals, the assessee assails on identical grounds the correctness of the separate orders dated 23.10.2017 pertaining to 2004-05, 2005-06 and 2007 08 of CIT(A) Palampur. The ld. AR inviting attention to the respective orders submitted that it is not correct that the assessee remained unrepresented as on the dates mentioned in para 2, the assessee was represented by office employees. However, it was agreed that the assessee was not represented by any counsel. The appeals, it was submitted, were dismissed following the orders of the ITAT on the issue. It was his submission that on similar set of facts and circumstances, the issue was remanded to the CIT(A) in 2008-09 and 2013-14 assessment years in ITA 348 & 349/CHD/2018 by order dated 15.06.2018. Accordingly, it was his prayer that similar directions be given in the present proceedings. The ld. AR gave his oral undertaking in the Court stating that the assessee shall participate fully and fairly.

2. The ld. CIT-DR taking into consideration the fact that the impugned orders are ex-parte orders agreed that the issue may be remanded back.

3. We have heard the rival submissions and perused the material available on record. It is seen that in the facts of the present case the CIT(A) noting the specific opportunities given in para 2 of his order dismissed the assessee's appeal holding as under :

“In the present case, despite being given several opportunities of hearing, the appellant has not produced any evidence or material on record or ny written submissions during appeal to distinguish the facts of the case from the assessment years 2006-07 and 2011-12. In view of the above, respectfully following the decisions of Hon'ble ITAT, Chandigarh, in assessee's own case for AYs 2006-07 and 2011-12, the denial of exemption under section 10(23C)(iiiab) of the Act by Ld.AO is upheld. The appellant also does not have any registration under section 12AA of the Act. The appellant also is not eligible for exemption under section 10(23C)(vi) of the Act during the current year, as the appellant made an application under section 10(23C){vi) only on 20.06.2008 and the said approval under s ction 10(23C)(vi) was granted by worthy CCIT, Shimla on 30.06.2009 w e f AY 2009-10 onwards.”

4. Accordingly, we find that the order admittedly was passed without hearing the assessee. It is also seen that the issue in 2006-07 assessment year and 2011-12 assessment year admittedly has been decided against the assessee. These facts have been noted in the aforesaid order dated 15.06.2018 also. The following extracts of the order bring out the issue :

2. However, at the time of hearing, some office employee of the assessee present in the Court orally stated that his counsel was unable to appear. It was pointed out to the concerned person that even before the CIT(A), the assessee failed to put in an appearance as is evident from para 2 of the said order and impugned order has been passed taking into consideration the past history of the assessee. The office employee was unable to state anything despite a pass over. We further take note of the fact that the impugned orders have been passed ex-parte. For ready reference, para 2 of ITA 348/CHD/2018 in terms of lack of representation before the CIT(A) which is identical in both the cases is reproduced hereunder :

“2. The appeal was fixed for hearing on 09.06.2017, 13.07.2017, 23.08.2017, 12.09.2017, 19.09.2017, 22.11.2017 and 20.12.2017. Written submissions have been filed.”

“3. It is seen that the CIT(A) has passed a detailed speaking order relying upon order of the ITAT as would be evident from para 7 of the impugned order which shows that the order passed in 2008-09 assessment year i.e. ITA 348/CHD/2018 by the ITAT dated 18.01.2016 has been relied upon. The said order, we are informed, till date has not been upset by any Forum. The relevant finding is reproduced as under :

7. I have considered the facts of the case and find that these are identical to the facts / issues decided by Hon'ble ITAT, Chandigarh in the case of the appellant for A.Y. 2006-07 and A.Y. 2011-12 in the following appeals :

i) ITA No. 405/Chd/2012, Assessment year 2006-07, dated 13.09.2013

ii) ITANO.673/Chd/2014, A Y 2011-12, dated 18.01.2016 Hon'ble ITAT dismissed the appeal of the appellant for AY 2006-07 holding as under :

9. We have heard the rival submissions and perused the material available on record. Section 10 (23C)(iiiab) of the Income Tax Act provides as under:- 10(23C)……… [(iiiab) any university or other educational institution existing solely for educational purposes and not for purposes of profit, and which is wholly or substantially financed by the Government; or (iiiac)……

10. The condition of the above provision would show that University and other educational institutions must exist solely for education purposes and not for the
purposes of profits and which is wholly and substantially financed by the government. The Assessing Officer has given a specific finding against the assessee that in the assessment year under appeal, the assessee has not fulfilled the conditions of the above provision. It was also found that in the assessment year under appeal, the assessee has advanced its income to the State Government. The Ld. CCIT Shimla has granted approval u/s 10(23C) (vi) of the Income Tax Act to the assessee AOP from the assessment year 2009-10 onwards subject to certain conditions, therefore, the same would not apply to the assessment year under appeal i.e. 2006-07. The Ld. CIT(A) on examination of the assessment record also found that assessee had never been financed by the Government during the assessment year in appeal and other years. It was also found hat assessee has been generating its own income from sale of books and on account of registration fees. The Ld. CIT(A) therefore, on examination of th records found that the aid from the State Government to the assessee is nil and it was wrongly mentioned by the Assessing Officer in the assessment order that the assessee Board is financed and controlled by the state government. In fact, in the assessment year under appeal, the assessee Board has transferred and amount of Rs. 5 crores to the Himachal Pradesh Government from its own income. It was also noted from the record that assessee Board is not directly controlled by the State Govt. but is governed under the Separate Himachal Pradesh Board of School Education Act, 1968. The Ld. CIT(A), therefore, found that assessee does not exist solely for educational purposes. It is in fact earning huge profits and has surplus income and profits. The finding of the fact recorded by Ld. CIT(A) clearly suggests that assessee did not have fulfill the terms and conditions of section 10(23C)(iiiab) of the I.T.Act. The appeal was adjourned many times but the assessee did not take any steps to produce any evidence before the Tribunal to contradict the findings of fact recorded by Ld. CIT(A) in the impugned order. Even during the course of arguments, Ld. Counsel for the assessee was specifically required to point out any error in the order of Ld. CIT(A) on the basis of evidence or material on record but it was stated that no evidence or material has been filed on record to contradict the above finding of fact recorded by Ld. CIT(A). The Ld. Counsel for the assessee only relied upon the two unreported judgments as above, however, the said judgments could not be considered favorable in favour of the assessee in the absence of any evidence or material on record in favour of the

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