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Income Tax Appellate Tribunal, INDORE BENCH, INDORE
Before: SHRI KUL BHARAT & SHRI MANISH BORAD
Appellant by Shri Ashish Goyal & Shri N.D. Patwa, A.Rs Respondent by Smt. Ashima Gupta, D.R. Date of Hearing: 28.03.2019 Date of Pronouncement: 04.04.2019 आदेश / O R D E R PER KUL BHARAT, J.M: These two appeals against the separate orders of CIT(Exemption), Bhopal dated 30.8.2017. First we take up
[ITA 679 & 680/Ind/2017] [Mahakavi Pandit Bhuramal Samajik Sahkar Nyas, Sagar] ] ITA No.679/Ind/2017. The assessee has raised following grounds of appeal:
The facts in brief are that the assessee had made an application seeking registration u/s 12AA of the Income Tax Act, 1961 (hereinafter called as ‘the Act’) in form No.10A received in the office of the CIT(Exemption) on 2nd 2
[ITA 679 & 680/Ind/2017] [Mahakavi Pandit Bhuramal Samajik Sahkar Nyas, Sagar] ] March, 2017. Thereafter, the Ld. CIT issued notice to provide opportunity of hearing to the assessee. After considering the submissions, the Ld. CIT refused registration u/s 12AA of the Act. The basis of rejection of application was that the additional condition prescribing aggregate receipts not to exceed 20% of the total receipt was not satisfied. Against this finding of the Ld. CIT, the assessee is in appeal before this Tribunal.
Ld. Counsel for the assessee submitted that Ld. CIT was not justified in rejecting the application at the stage of registration itself. Ld. Counsel for the assessee has taken us through the objects of the assessee society. He further submitted that at the time of registration, the Ld. CIT is required to satisfy itself about the objects of the assessee society. The Ld. Counsel for the assessee has placed reliance on various case laws. He relied on the following judgements:
[ITA 679 & 680/Ind/2017] [Mahakavi Pandit Bhuramal Samajik Sahkar Nyas, Sagar] ]
1. Indian Trade Promotion Organisation Vs. DGIT (Exemptions) (2015) 53 Taxmann.com 404 (Delhi).
2. Central Institute of Tool Design 68 taxmann.com 407 (Hyd.) 3. Social Pedia Knowledge Foundation 31 taxmann.com 255 (Chennai) 4. Punjab Cricket Association 65 taxmann.com 239 (Chand.) 5. Kapurthala Improvement Trust 60 taxmann.com 301 (Asr.) 4. He submitted that under the facts of the present case, the Ld. CIT ought to have granted the registration.
On the contrary, Ld. D.R. supported the order of the Ld. CIT and submitted that there is no ambiguity under the law. The assessee was required to fulfill certain conditions, which the assessee has not fulfilled. Therefore, the case laws as relied by the Ld. Counsel for the assessee would not help the assessee.
We have heard the rival submissions, perused the materials available on record and gone through the orders of the authorities below. Admittedly, Ld. CIT(Exemption) has come to the conclusion that the first condition of the [ITA 679 & 680/Ind/2017] [Mahakavi Pandit Bhuramal Samajik Sahkar Nyas, Sagar] ] proviso to section 2(15) of the Act is satisfied, however, in respect of second condition, he is of the view that the receipts are likely to exceed, hence, condition No.2 is not satisfied. Considering this, he rejected the application.
This reasoning as given by the Ld. CIT(Exemption) is contrary to the ratio laid down by the Hon'ble Delhi High Court in the case of ITPO Vs. DGIT (supra). We therefore, considering the totality of the facts, set aside the impugned order and restore the application to the file of the Ld. CIT(Exemption) for decision afresh.
ITA 680/Ind/2017:
In this appeal, the assessee has raised following grounds of appeal:
1. That on the facts and in the circumstances of the case, the learned CIT (Exemption) erred in passing the order u/s 80G(5)(vi) of the Act by rejecting the application filed in Form No.10G seeking exemption u/s 80G of the Act and refusing the exemption sought u/s 80G of the Act stating that being the registration u/s 12A was denied to the trust, the exemption u/s 80G is also denied.
[ITA 679 & 680/Ind/2017] [Mahakavi Pandit Bhuramal Samajik Sahkar Nyas, Sagar] ] 2. That on the facts and in the circumstances of the case, the learned CIT(Exemption) before refusing to grant the registration u/s 12AA must ought to consider all the objects and different activities as a whole carried on by the trust at the time of registration because all the activities of the trust are charitable in nature and hence, is entitled and eligible for registration u/s 12AA of the Act.
Thus, the order passed by the learned CIT(Exemption) is unjust, unfair and bad in law and hence, liable to be restored.
3. That the appellant craves leave to add, to urge, to alter or to amend any of the ground of the appeal on or before the date of hearing.
The facts in brief are that the assessee has made an application seeking registration u/s 80G of the Income Tax Act, 1961 (hereinafter called as ‘the Act’) in form No.10G received in the office of the CIT(Exemption) on 2nd March, 2017. Thereafter, the Ld. CIT issued notice to provide opportunity of hearing to the assessee. After considering the submissions, the Ld. CIT refused registration u/s 80G of the Act. The basis of rejection of application was that the registration u/s 12AA of the Act sine qua non for granting registration u/s 80G of the Act. Against this [ITA 679 & 680/Ind/2017] [Mahakavi Pandit Bhuramal Samajik Sahkar Nyas, Sagar] ] finding of the Ld. CIT, the assessee is in appeal before this Tribunal.
Ld. Counsel for the assessee submitted that Ld. CIT was not justified in rejecting the application at the stage of registration itself. Ld. Counsel for the assessee has taken us through the objects of the assessee. He further submitted that at the time of registration, the Ld. CIT is required to satisfy itself the objects of the assessee.
The Ld. Counsel for the assessee has placed reliance on various case laws. He relied on the following judgements:
Indian Trade Promotion Organisation Vs. DGIT (Exemptions) (2015) 53 Taxmann.com 404 (Delhi).
2. Central Institute of Tool Design 68 taxmann.com 407 (Hyd.) 3. Social Pedia Knowledge Foundation 31 taxmann.com 255 (Chennai) 4. Punjab Cricket Association 65 taxmann.com 239 (Chand.) 5. Kapurthala Improvement Trust 60 taxmann.com 301 (Asr.) 10. He submitted that under the facts of the present case, the Ld. CIT ought to have granted the registration.
[ITA 679 & 680/Ind/2017] [Mahakavi Pandit Bhuramal Samajik Sahkar Nyas, Sagar] ] 11. On the contrary, Ld. D.R. supported the order of the Ld. CIT (Exemption) and submitted that there is no ambiguity under the law. The assessee was required to fulfill certain conditions, which the assessee has not fulfilled. Therefore, the case laws as relied by the Ld. Counsel for the assessee would not help the assessee. He further submitted that since registration u/s 12AA of the Act was declined hence the assessee is not entitled for registration u/s 80G of the Act.
We have heard the rival submissions, perused the materials available on record and gone through the orders of the authorities below. Since we have restored the application u/s 12AA of the Act for decision afresh in for the same reasoning, the impugned order in this appeal is also set aside and the application is restored to the file of the Ld. CIT(Exemption) for decision
[ITA 679 & 680/Ind/2017] [Mahakavi Pandit Bhuramal Samajik Sahkar Nyas, Sagar] ] afresh. Needless to say, Ld. CIT(Exemption) would decide application of the assessee in accordance with law.
In the result, both the appeals filed by the assessee are allowed for statistical purposes.
Order was pronounced in the open court on 04 .04.2019.