Appellant: Maharishi Markandeshwar University Trust, Ambala Cantt
Respondent: Pr.CIT, Central, Gurgaon
Assessment Year: 2011-12
Case Filed On: 2019-02-27
Order Type: Final Tribunal Order
Date of Order: 2019-08-19
Pronounced On: 2019-08-19
The appellant, Maharishi Markandeshwar University Trust, challenged the order of the Principal Commissioner of Income Tax (Pr.CIT), Central, Gurgaon, under section 263 of the Income Tax Act, 1961. The Pr.CIT had revised the assessment order for the assessment year 2011-12, claiming it was erroneous and prejudicial to the interests of the Revenue.
The key issues raised by the Pr.CIT in the revisionary order were:
The appellant contested the revisionary order on several grounds, including:
The tribunal examined the evidence and found that the Pr.CIT’s allegations were based on general observations and lacked specific instances of siphoning funds. The appellant provided detailed explanations and supporting documents, including affidavits and financial records, which were not properly considered by the Pr.CIT.
The appellant demonstrated that salaries, interest, and rent payments to trustees and family members were legitimate and in accordance with the trust’s financial policies. The tribunal noted that the Pr.CIT did not provide concrete evidence of any wrongful diversion of funds.
The tribunal found that the Pr.CIT’s conclusions about trustees obtaining benefits from trust employees were speculative. The appellant provided affidavits and other evidence showing that employees’ services were utilized for trust activities and not for personal gain.
The tribunal reviewed the MCI guidelines and the appellant’s compliance with them. It found that the Pr.CIT’s allegations were based on a misunderstanding of the guidelines. The appellant provided detailed records of student admissions, which were consistent with MCI requirements.
The tribunal noted that the original assessment had thoroughly examined salary payments to teachers. The appellant submitted extensive documentation, including salary registers and attendance records, which supported the legitimacy of the payments. The Pr.CIT’s allegations were deemed unfounded.
The tribunal found that the appellant provided adequate explanations and documentation regarding vehicle purchases. The vehicles were used for trust purposes, and the trust properly accounted for the expenditures. The Pr.CIT’s conclusions were not supported by evidence.
The appellant demonstrated that rent payments to trustees were for properties used for trust activities. The tribunal found no evidence of improper diversion of funds through these payments.
After a comprehensive review of the facts and evidence, the tribunal concluded that the Pr.CIT’s revisionary order under section 263 was not justified. The original assessment order was neither erroneous nor prejudicial to the interests of the Revenue. The tribunal set aside the revisionary order and upheld the original assessment.
The final judgment was pronounced in the Income Tax Appellate Tribunal, Delhi Benches ‘G’, New Delhi, before Shri H.S. Sidhu, Judicial Member, and Dr. B.R.R. Kumar, Accountant Member.
Final Judgment: The tribunal set aside the Pr.CIT’s revisionary order and upheld the original assessment order.
Maharishi Markandeshwar University Trust vs Pr.CIT, Central, Gurgaon – ITA No. 1596/DEL/2019
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