Airports Authority of India Employees Provident Fund Trust vs The Income Tax Department, Delhi

PER BRAJESH KUMAR SINGH, AM,

This appeal by the Revenue is directed against the order dated 05.03.2025 of the Commissioner of Income Tax, Appeal, ADDL/JCIT (A), Kochi, [hereinafter referred to as the ‘Ld. CIT(A)] arising out of the intimation u/s 143(1) of the Income Tax Act, 1961 (hereinafter referred to as the ‘the Act’) passed by the CPC, Bengaluru on 14.03.2016.

The assessee is an approved Provident Fund Trust under Rule 3(1) of part A of the Income Tax Act, 1961 vide order no. F. No. CIT-1/150/(HQ-1)/ PF/2010-11/505 dated 01.06.2010. The assessee had claimed a sum of Rs. 1,14,70,598/- as exempt income u/s 10 of the Act which was disallowed by the ACIT, CPC, Bengaluru, raising a tax demand of Rs. 36,00,080/-.

Aggrieved with the said order, the assessee preferred an appeal before the Ld. CIT(A).

During the appellate proceedings, the Ld. CIT(A) noted that the assessee had not substantiated its claim in response to the defective notice issued by CPC, Bangaluru, u/s 139(9) of the Act on 04.06.2015 fixing the response due date on 02.09.2015. Further, before the Ld. CIT(A), the assessee did not appear on various occasions as noted by the Ld. CIT(A) out in para number 6.2 of the appellate order and taking note of the fact that the assessee failed to substantiate the said claim for exemption held that no relief could be granted to the assessee. Accordingly, the Ld. CIT(A) dismissed the appeal of the assessee.

In the appellate proceedings before us, the assessee once again submitted that it is an approved Provident Fund Trust under Rule 3(1) of part A of the Income Tax Act, 1961, and that the interest income amounting to Rs. 1,14,70,598/- earned by the assessee Trust was an exempt income. In this regard, the assessee placed before us, a letter issued by the then CIT, Delhi-1, New Delhi, granting the above recognition, which is reproduced as under:

In the result, the appeal of the assessee is allowed.