1. These two departmental appeals are against the order of the AAC in respect of an assessment of Shri Joshua Gootam of Kakinada for the assessment year 1979-80. Two appeal numbers have been assigned because the ITO had sent a duplicate also separately. In the circumstances, IT Appeal No. 1553 is treated as duplicate appeal and dismissed on this ground.
2. The assessee is a Christian missionary. He had disclosed an amount of Rs. 26,437 as gross remuneration for his services. He had also declared interest on deposits in bank to the extent of Rs. 6,000. After deductions for standard deduction and other allowances, he returned a net income of Rs. 24,360. He, however, appended a note in Part III of the return to the effect that he had received Rs. 81,025 from various foreign organisations during the year in trust on their behalf for being expended on services expected of him as a missionary. He also admitted receipts at Rs. 35,914 in 'Satyavani' account and Rs. 27,493 in 'Voice of Trust' account. He has categorically stated 'the assessee had nothing to do with the said amounts also in his individual capacity since the money is not his.' It is also pertinent to note that the assessee had been appending similar notes for earlier years with reference to the deposits in his bank accounts, sometimes of much larger amounts than this amount. The ITO examined the assessee's bank accounts and found that the gross credits were to the tune of Rs. 1,44,432. He noticed that the amounts were received from institutions like College Church, Texas, Chapel Avenue Church of Christ, USA, Illinois Church, St. Clairsville Church, etc. He found that the assessee admittedly spent Rs. 1,01,303 during the year on items like purchase of paper, printing, expenditure on school and hospital, etc.
He found that there were withdrawals from bank accounts of Rs. 2,000, Rs. 5,000 and Rs. 3,000 on 21-7-1978, 3-10-1978 and 3-1-1979, for which the assessee was not in a position to point out the destination apart from making the claim that these were for purposes intended. Only Rs. 91,303, according to the ITO, was spent on charitable objects. The entire difference between Rs. 1,44,432 and Rs. 91,303, according to the ITO, was to be treated as the assessee's income. The ITO opined that these moneys were received by the assessee in his individual capacity and that he is liable to tax on the amount unspent. The first appellate authority, however, found that the facts even as found by the ITO did not justify the assessment. He found that the assessee spends the entire amount received in some years and spends a little later for some other years. In other words, the moneys were all spent for missionary activities. He found that the assessee is accountable for the moneys received. There is even periodical supervision over his activities. He found that the assessee was a mere trustee in respect of the amounts received. Merely because the assessee showed the amounts in Part III of the return, he was of the view that it does not become his income. He pointed out that the assessee, who is a priest, received the amounts broadly for the propagation of Christian religion in the area and that these funds were held in trust by him and were actually spent for the purpose. He, therefore, found no basis for the addition. The appeal was, therefore, allowed.
3. In the departmental appeal, the decision of the first appellate authority is disputed. According to the grounds, it is claimed that the assessee 'was freely using the amounts as his own'. It is also pointed out that he has credited them in bank accounts in his name. The fact that the assessee was not able to prove all his expenses, according to the grounds, justified the assessment order and showed that the inference of the first appellate authority was incorrect. The learned departmental representative took us over the return, the assessee's correspondence and the assessment order. It is pointed out that the assessee claimed that the assessee had shown much larger amounts in Part III of the return. He also pointed out to a letter addressed by the assessee on 18-11-1982 in connection with the assessment wherein the assessee admitted that he was receiving moneys from abroad in his capacity as an 'evangelist' by profession. He also further admitted that he was not maintaining 'systematic accounts for my receipts and expenditure'. The statement was made in response to the show-cause notice for not having filed the advance tax estimate. The learned departmental representative claimed that this letter shows that the assessee was in the profession and that the moneys were intended as remuneration for himself. He also claimed that the entire receipts could have been taxed by the ITO who had been reasonable in restricting the assessment to the amount unspent by him for himself. He, therefore, contended that the assessment deserves to be upheld. He was also of the view that the law supported the assessment. He pointed out to the decision of the Supreme Court in the case of P. Krishna Menon v. CIT  35 ITR 48 where the Supreme Court found that even a teacher of Vedanta philosophy could be treated as having a vocation and not a profession and that a voluntary payment received by him was taxable in his hands. He then referred to the decision of the Kerala High Court in CIT v. Dr. K. George Thomas  97 ITR 111 where the Kerala High Court held that the contribution received by the assessee for running a newspaper Kerala Dhwani for the spread of religion from the funds from America were treated as his own income. He also pointed out to the decision of the Madras High Court in the case of Addl. CIT v. Gangabai Charities  142 ITR 718 wherein it was held that it should be clearly established that the object of the trust is charitable and that the absolute discretion to use the trust money by a trustee could vitiate the claim of the assessee that there is a charitable trust. In the assessee's case, it was contended that there was such an absolute discretion for the assessee. It was also claimed that the assessee was also receiving moneys for the two papers just as Dr. George Thomas in the facts of the Kerala High Court decision in Dr. K. George Thomas's case (supra).
4. The learned Counsel for the assessee, on the other hand, claimed that there are no factual foundation for the claims made by the learned departmental representative. He pointed out that the assessee is a priest and has admitted his income from remuneration. Hence, he pointed out that the assessee is not claiming his remuneration to be exempt from tax or not taxable and that, therefore, the decision in P. Krishna Menor's case (supra) does not help the revenue. The assessee receives moneys from his employers and sponsors for certain specific purposes which are religious in nature. The question whether they are charitable or not is a secondary one and the present assessment could not be concerned with such question though it is the assessee's case that the assessee is engaged in public religious and charitable activities. All that matters, he pointed out, is that the claim of the assessee that he was merely acting as a trustee. If any assessment is warranted on unspent amount or on the ground that the purpose is not a charitable one, the learned Counsel argued that the assessment of such income could not be in the assessee's individual hands wherein his income from remuneration is taxed. He pointed out that the revenue has not brought any materials on record for challenging the finding of the first appellate authority. It was claimed that the assessee was in a position to furnish full details as to the nature of the deposit. It was pointed out that the ITO himself has mentioned that these amounts emanated from various Christian organisations. It is futile to imagine that these large amounts are given to him without any strings so that the assessee could even ufilise the same for his personal needs as wrongly assumed by the authorities. It was further claimed that the decision in the case of Dr. K. George Thomas (supra) cannot apply. The papers in the instant case are again for a religious purpose and not a personal paper as was found in Dr. K. George Thomas's case (supra). In fact, it is pointed out that Dr. George Thomas had argued that the moneys were his and that they were personal gifts to him, while it is the assessee's case that the moneys never belonged to him. The assessee being a prudent person had deposited the moneys in his bank accounts as a matter of abundant caution. This cannot make him taxable if it is not otherwise taxable. He also pointed out that the assessee has received similar and larger amounts in earlier years without attracting any tax liability. In fact, even for subsequent assessment year, as for example, 1980-81, the assessee had received Rs. 1,05,115 besides further amounts for the two religious papers. No attempt was made to tax the same. The finding of the first appellate authority is in accord with the records. The learned Counsel while distinguishing the cases cited by the revenue, had also pointed out that the Travancore Cochin High Court in Rev. Father Prior, Sacred Heart's Monastery v. ITO  30 ITR 451 upheld the claim for exemption in respect of amounts received as donations by a monastery for putting up a charitable institution though in that case mass stipend was treated as donation to an individual priest who receives such amount for saying mass. The learned Counsel for the assessee cited the decision of the Supreme Court in CIT v. Groz-Beckert Saboo Ltd.  116 ITR 125 wherein even the gift of raw material by a foreign collaborator to an Indian taxpayer was held to be a capital receipt on the assumption that a gift could never constitute income.
5. We have carefully considered the records as well as arguments. The assessee is an evangelist by profession and offered his remuneration as taxable income. He also receives money from his sponsors and its allied institutions in the United States for the purposes of propagation of religion. The assessee has also given the details of the donors and has claimed that he was acting as a trustee on behalf of such institutions for spending the moneys broadly for propagation of religion. Even the moneys received on account of the two papers are not claimed to be personal gifts to the assessee. The question whether the purpose for which these amounts were received by him would qualify for exemption under Section 11 of the Income-tax Act, 1961 ('the Act') is beyond the purview of this assessment which is on Shri Joshua Gootam as an individual. There is no material to warrant the inference in the grounds of appeal that the moneys were given to him for personal use.
It has been the consistent stand of the assessee that he was accountable for all such moneys. Accountability is what distinguishes the personal funds from the trust moneys whether there is a formal trust or not. In the absence of any material to suggest that the assessee was free to spend the money as he liked without spending it for purposes for which they were meant, such contributions cannot be treated as the assessee's income. No doubt, both sides have cited authorities for their respective stand. But all these decisions depended on facts found in each case and do not contribute to a solution for the dispute before us. The simple question is whether the assessee received these moneys for his personal use or whether he had received these moneys on behalf of the institutions for being spent on purposes for which they were intended. If he were accountable for these funds as he had consistently claimed, the question of treating the same as his personal funds cannot arise. In fact, the ITO has not only been inconsistent with his own inference for earlier and later years but he has been inconsistent even in respect of the treatment to be accorded to the entire receipts. If the moneys belonged to the assessee, the entire receipt should constitute his income irrespective of the fact whether he had spent part of the receipts for public charitable or religious purpose or not. It is only in respect of institutions governed by Section 11 that unspent income received even by way of voluntary contributions could be taxed unless there is a permission for accumulation of such income from the ITO. The ITO was, therefore, not correct in assuming that only unspent income could be taxed in the hands of the assessee, if he was right in concluding that the receipts were his personal receipts. The very fact that the ITO confined his addition to the surplus shows that he was not of the view that the entire funds belonged to him in his personal capacity. Hence, the revenue's case in the appeal before us is more or less a new one inasmuch as it seeks to canvass that the assessee was free to use the money in whatever manner he likes. Apart from the fact that there is no material whatsoever for this assumption, we find that the ITO himself has not made this claim. The ITO appears to have thought that if a trustee does not keep accounts or is unable to prove the expenditure to be valid for trust purposes, it would amount to appropriation of the trust income taxable in trustee's hands. He was certainly wrong in this view. Even if there be misappropriation, the trustee is bound to recoup the same and the amount so misappropriated could never be the trust income. It is not said that there is any misappropriation in the assessee's case. In fact, the assessee's accounts over the years show that the moneys are spent sooner or later. In any view of the matter, we do not find any material to upset the order of the first appellate authority which has to be upheld.6. In the result, IT Appeal No. 1565 (Hyd.) of 1982 will also stand dismissed.