Specified Person in the audit report in Form 10B

IN THE INCOME TAX APPELLATE TRIBUNAL
(DELHI BENCH ‘G’ : NEW DELHI)
BEFORE SHRI O.P. KANT, ACCOUNTANT MEMBER
and
SHRI KULDIP SINGH, JUDICIAL MEMBER
(THROUGH VIDEO CONFERENCE)
ITA No.7445/Del./2017
(ASSESSMENT YEAR : 2013-14)

ITO (E), Ward 2 (3),

New Delhi

(APPELLANT)

vs

The Inclen Trust International,

F-1/5, 2nd Floor,
Okhla Indl. Area, Phase – 1,
New Delhi – 110 020.

(PAN : AABTT1814A)

(RESPONDENT)

ASSESSEE BY : Shri K.V.S.R. Krishna, Advocate
REVENUE BY : Shri Prakash Dubey, Senior DR
Date of Hearing : 08.07.2021
Date of Order : 28.07.2021
O R D E R

Appellant, ITO (E), Ward 2 (3), New Delhi (hereinafter referred to as ‘the Revenue’) by filing the present appeal sought to set aside the impugned order dated 06.09.2017 passed by the Commissioner of Income-tax (Appeals)-40, Delhi qua the assessment year 2013-14.

2.Briefly stated the facts necessary for adjudication of the controversy at hand are : Assessee, M/s. Inclen Trust International, being a trust registered under section 12A of the Income-tax Act, 1961 (for short ‘the Act’) having charitable aims and objective filed return of income declaring nil income.

3.Assessee carried the matter before the ld. CIT (A) by way of filing an appeal who has partly allowed the appeal. Feeling aggrieved by the order passed by the ld. CIT (A), the Revenue has come up before the Tribunal by way of filing the present appeal.

4.Bare perusal of the definition of the “specified person”, extracted above, goes to prove that Dr. N.K. Arora, Executive
Director of the trust does not fall under any head of the specified person. AO has used the word that Dr. N.K. Arora is a de facto trustee and there is no such category in the name of de facto trustee under section 13(3) of the Act.

5.AO made an addition of Rs.37,19,000/- being the excessive remuneration paid to Dr. N.K. Arora. On the one hand, he is being considered a specified person as a de facto trustee and on the other hand, he is being admitted as working under the trust and his remuneration found to be excessive.

6.So, finding no illegality or perversity in the impugned order, appeal filed by the Revenue is dismissed.
Order pronounced in open court on this 28th day of July, 2021.

Please find attached the enclosed file for the full judgement