INDIAN ROADS CONGRESS,NEW DELHI vs. INCOME TAX EXEMPTION, WARD 1(2), NEW DELHI

ITA 1516/DEL/2026Status: DisposedITAT Delhi29 September 202610 pages
AI SummaryAllowed

What were the facts?

The assessee, Indian Roads Congress, a society registered u/s 12A, filed its return for AY 2012-13 declaring NIL income. The initial assessment u/s 143(3) was at NIL income, accepting the charitable activities. Subsequently, the Assessing Officer (AO) reopened the assessment u/s 147, believing income had escaped assessment. The AO's reason was that the assessee had reduced INR 1,30,11,971/- (subscriptions, entry fees, life membership fees) from gross receipts, which the AO considered not to be voluntary contributions for corpus u/s 11(1)(d). The reassessment order dated 16.06.2016 added this amount (less 15%) to the total income, assessing it at INR 1,10,59,995/-. The assessee appealed to the CIT(A), who dismissed the appeal in limine due to a 97-day delay, not condoning it despite the assessee's explanation.

What did the Tribunal hold?

The Tribunal held that the reopening of assessment u/s 147 was not permissible as it was based on the same set of material considered during the original assessment u/s 143(3). The Tribunal, respectfully following the judgments of the Hon'ble Supreme Court in CIT vs Kelvinator of India Ltd. and the jurisdictional High Court, opined that reassessment proceedings initiated without fresh tangible material in the possession of the AO after the completion of the original assessment are contrary to law. Such reopening vitiates the entire reassessment proceedings, which are hereby quashed. The legal grounds of appeal taken by the assessee are allowed. The issue of condonation of delay before the CIT(A) was not adjudicated on merits by the Tribunal as the primary issue of invalid reopening was decided in favour of the assessee. The Tribunal did not decide on the merits of the additions or the claim for depreciation or accumulation.

What were the issues?

1. Whether the Learned Commissioner of Income-tax (Appeals) erred in law and on facts in holding that no sufficient cause existed for condonation of delay, and in rejecting the Appellant's prayer for condonation, thereby violating principles of natural justice? (Mixed law and fact, concerning Section 250 of the Income Tax Act, 1961). 2. Whether the Learned Commissioner of Income-tax (Appeals) erred in law in not admitting the appeal and failing to adjudicate the grounds on merits, despite the Appellant having made out a fit case for condonation of delay? (Mixed law and fact, concerning Section 250 of the Income Tax Act, 1961). 3. Whether the Learned Assessing Officer erred in law and on facts in initiating reassessment proceedings without any tangible material or fresh external evidence, and in the absence of any valid "reason to believe", making the reopening bad in law and without jurisdiction? (Mixed law and fact, concerning Section 147 of the Income Tax Act, 1961). 4. Whether the reassessment proceedings are bad in law and void ab initio, as the Learned Assessing Officer failed to furnish the recorded reasons for reopening to the Assessee, a mandatory jurisdictional requirement? (Mixed law and fact, concerning Sections 147/148 of the Income Tax Act, 1961). 5. Whether the reassessment proceedings are bad in law and without jurisdiction, as the reasons recorded by the Learned Assessing Officer for reopening are based solely on a change of opinion, without any fresh tangible material? (Mixed law and fact, concerning Sections 147/148 of the Income Tax Act, 1961). Assessee's contentions: The delay in filing the appeal before the CIT(A) was due to circumstances beyond control. Reopening of assessment was based on existing material, not fresh evidence, constituting a mere change of opinion, relying on CIT vs Central Warehousing Corporation and CIT vs Kelvinator of India Ltd. The AO lacked tangible material and valid reason to believe for reopening. Revenue's contentions: Not recorded in the judgment.

Which sections of the Income-tax Act were involved?

Section 12A,Section 11(1)(d),Section 147,Section 143(3),Section 148,Section 250,Section 11(2),Section 11(5),Section 234B

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI “G” BENCH, NEW DELHI

Before: SHRI ANUBHAV SHARMA & SHRI MANISH AGARWAL

For Respondent: Ms. Beenu, Sr. DR

PER MANISH AGARWAL, A.M.: The present appeal is filed by assessee against the order dated 16.12.2025 passed by Ld. Commissioner of Income Tax (A), National Faceless Appeal Centre (“NFAC”), Delhi [“Ld. CIT(A)”] in Appeal No. CIT(A), Delhi-40/10203/2016- 17 u/s 250 of the Income Tax Act, 1961 [“the Act”] arising out of assessment order dated 16.06.2016 passed u/s 147 r.w.s. 143(3) of the Act pertaining to Assessm

The order continues below.

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