SAGARA KSHATRIYA WELFARE AND CHARITABLE TRUST,HYDERABAD vs. INCOME TAX OFFICER, EXEMPTION WARD 1(4), HYD, HYDERABAD

Brief facts of the case are that the assessee is a Registered Society having registration under section 12A of the Income Tax Act, 1961 (for short “the Act”). It is said to have been running for welfare of the poor and needy and Kshatriya community, promoting education among poor and helping needy for funding of the marriages. The assessee society has registration under section 12A of the Act vide Registration No. HYD/12AA/2020-21/A/10105 dated 25/08/2020. The assessee did not apply for the new registration under section 12A of the Act, by filing form 10A as per the amended provisions of the Section 11 of the Act. Assessee filed its return of Income for the assessment year 2022-23 within the due date under section 139(1) of the Act, by claiming exemption of its income as per provisions of Section 11 of the Act under the old exemption registration under section 12A of the Act and also filed audit in form No. 10B for the year under consideration within the due date. An intimation under section 143(1) of the Act was passed by CPC on 31/03/2023, by disallowing the total expenditure of Rs. 93,36,639/- and calculated the tax on the gross receipts of Rs. 1,29,57,313/- and raised the demand of Rs. 50,43,810/-.

Aggrieved by the above, the assessee preferred an appeal against the order passed by the CPC, before the learned CIT(A), but the learned CIT(A) by way of impugned order, dismissed the same on the ground that the assessee did not apply for new registration under section 12A of the Act and not filed Form 10A as per amended provisions of section 11 of the Act, and, therefore, the learned Assessing Officer rightly disallowed the exemption claimed by the assessee under the old exemption.

At the time of arguments, learned AR produced a copy of Form No. 4. 10AC and submitted that on 11/08/2023, registration has been granted from assessment year 2022-23 to assessment year 2026-27 and this year is also covered by such an order.

There is no dispute as to this document which clearly establishes that subsequent to the intimation under section 143(1) of the Act and order of the first appellate authority, the request of the assessee for registration under section 12A of the Act has been granted for the assessment year 2022-23 to 2026-27. In these circumstances, we are of the considered opinion that the matter requires re-consideration at the end of the learned CIT(A), in the light of the registration granted on 11/08/2023 for the assessment year 2022-23 to 2026-27.

We, accordingly set aside the impugned orders and restore the issue to the file of the learned CIT(A) for fresh consideration of the matter, in the light of the above referred registration dated 11/08/2023, after giving an opportunity of being heard to the assessee. Grounds are treated as allowed for statistical purposes.