IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH, AMRITSAR.

BEFORE SH. MANOJ KUMAR AGGARWAL, ACCOUNTANT MEMBER AND SH. UDAYAN DASGUPTA, JUDICIAL MEMBER (Physical Hearing)

I.T.A. Nos. 562 and 563/Asr/2025 Assessment Year: 2023-24 and 2024-25 School Managing Society Capt. Vs. DCIT, CPC, Bengaluru/

Gurcharan Singh Kapurthala, ITO (E) Ward, Jalandhar.

Punjab.

[PAN:-AADTS4577P]

(Appellant) (Respondent)

Appellant by Sh. Y.K. Sud, CA Respondent by Sh. Charan Dass, Sr. DR Date of Hearing 20.01.2026 Date of Pronouncement 26.02.2026

ORDER

Per: Udayan Dasgupta, J.M.:

This appeal is filed by the assessee against the order of ld. Addl./JCIT (A)-9, Delhi, passed u/s 250 of the Act, 1961 vide order dated 29.05.2025 which has emanated from the order of CPC, Bengaluru, passed u/s 143(1) of the Act, vide order dated 18.11.2024.

2. The grounds of appeal taken by the assessee in form 36 are as follows:

“1 That the CIT(A) was not justified in not allowing the exemption claimed by the assessee u/s 10(23c) (iiiad)

2 That CIT(A) failed to appreciate while disallowing the 0 exemption that if the assessee is entitled to exemption in some different sections, he can claim the same in the appellant proceedings before the CIT(A).

3 That without prejudice to the above grounds that CIT(A) 0 was not justified in upholding the action of the AO in not allowing the expenses amounting to Rs. 6964956.75 claimed from the gross receipts amounting to Rs. 7105690.60 and levying that tax on the gross receipts and not the net receipts after expenses amounting to Rs. 140733.85

4. That the orders of AO and Addl/JCIT(A) is against the Law 0 and Facts of the case.”

3. Brief facts emerging from records are that the assessee is a trust running an educational institution “ Premjoy Public School, which is duly affiliated with the CBSE Board , and duly registered u/s 12AA(I)(b)(i) of the Act 61, wef 01/04/2003 ( vide order of CIT dated 16/02/2005 ), but new re-registration procedure u/s 12AB as introduced by the Finance Act 2020 , which was required in the instant case, was missed due to oversight, and consequently, the returned income of NIL filed for the year under appeal, claiming exemption u/s 11, as per audited financials ( income and expenditure A/c and balance sheet ), along with audit report in form 10BB , has been ignored and assessment completed by CPC Bangalore, u/s 143(1) of the Act, by treating the entire gross receipts of Rs. 71.05 lakhs, as total income, thereby denying the benefit of exemption u/s 11, and also by refusing to allow the claim of expenditure as per accounts, thereby raising a tax demand of Rs. 27.72 lakhs.

4. The matter was carried in appeal before the Ld. first appellate authority primarily agitating two issues, firstly, since exemption u/s 11 is being denied ( in absence of 12AB registration ), the claim of expenses as per audited accounts directly related to earning of such income should be allowed as deduction and secondly, since the assessee is an educational institution, existing solely for educational purpose and not for purpose of profits and the gross annual receipts, being less than the stipulated limit ( less than Rs. five crores wef AY 2022-23), the assessee is entitled to the claim of exemption u/s 10(23C)(iiiad) of the Act, irrespective of any registration.

5. The Ld. CIT (A) has dismissed the appeal of the assessee with the observation ( para 6.4 and 6.5 of the appeal order ) that in absence of any registration u/s 12AB, there cannot be any claim for exemption u/s 11 and further observed that CPC, has processed the return u/s 143(1), as per the facts and figures returned by the assessee, and since the exemption u/s 10(23)(c) has never been claimed by the assessee, the said exemption could not have been allowed.

6. In course of hearing the Ld. AR of the assessee submitted that the powers of the CIT(A) are co terminus with the powers of the AO and any claim which is legally allowable to the assessee has to be considered in appeal proceedings and the