SYAM LAL PANWAR ANANDI DEVI vs. THE CHIEF COMMISSIONER OF INCOME TAX

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CW/6622/2014HC RajasthanRJHC02052990201423 April 2024Author: AVNEESH JHINGAN,BHUWAN GOYAL3 pages
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What did the High Court hold?

The High Court set aside the impugned orders dated 26.04.2012 and 27.03.2014 without commenting on the merits of the case. The Court acknowledged that the petitioner could not avail the opportunity of hearing due to the sickness and death of the father of the authorized representative. Consequently, the matter was remitted back to the concerned official to decide the application filed under Section 10(23C) of the Income Tax Act, 1961, in accordance with the law. The petition was allowed, and the operative direction was to reconsider the application.

What were the facts?

The petitioner, Shyam Lal Panwar Anandi Devi Memorial Charitable Trust, filed an application under Section 10(23C) of the Income Tax Act, 1961, for the financial year 2010-2011. The Chief Commissioner of Income Tax, Jaipur, issued a show-cause notice on April 16, 2012, proposing rejection of the application because the Trust was allegedly not solely for educational purposes. The petitioner failed to respond, leading to the rejection of the application on April 26, 2012. Subsequently, a rectification application was filed, supported by an affidavit stating that the authorized representative could not attend the hearing due to his father's serious illness and subsequent death on April 17, 2012. This rectification application was also dismissed, prompting the present writ petition.

What were the issues?

1. Whether the order dated 26.04.2012 rejecting the petitioner's application under Section 10(23C)(vi) of the Income Tax Act, 1961, is a non-speaking order and passed on wrong premises regarding the Trust's objectives? Assessee's Contentions: - The application was rejected on the incorrect assumption that the Trust is not solely for educational purposes. - The exemption was sought under Section 10(23C)(vi) for income from an institution established solely for educational purposes. - The order dated 26.04.2012 is a non-speaking order. - The petitioner could not attend the hearing due to the serious illness and death of the authorized representative's father. Revenue's Contentions: - As per the aims and objects of the Trust, it is involved in activities other than education, justifying the rejection.

Which sections of the Income-tax Act were involved?

Section 10(23C),Section 10(23C)(vi),Section 154

AI-generated summary — verify with the full judgment below

Cause title — parties, addresses and appearances
[2024:RJ-JP:18820-DB] HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR D.B. Civil Writ Petition No.6622/2014 Shyam Lal Panwar Anandi Devi Memorial Charitable Trust, Jaipur, Through Its Chairman And Managing Trustee Nirmal Panwar S/o Shri Shyam Lal Panwar, aged about 52 years, Residing at 135, Ram Nagar Extension, New Sanganer Road, Sodala, Jaipur. ----Petitioner Versus 1. The Chief Commissioner of Income Tax, C.R. Building, Bhagwan Das Road, Jaipur. 2. The Assistant Commissioner of Income Tax, Circle-1, Jaipur. 3. The Central Board of Direct Taxes, North Block, Department of Revenue, Ministry of Finance, New Delhi. ----Respondents For Petitioner(s) : Mr.Prakul Khurana, Adv. For Respondent(s) : Mr.Shantanu Sharma, Adv. with Ms.Bhavana Ladha, Adv. HON'BLE MR. JUSTICE AVNEESH JHINGAN HON'BLE MR. JUSTICE BHUWAN GOYAL

Order 23/04/2024

1.

This petition is filed seeking quashing of orders dated 26.04.2012 and 27.03.2014 rejecting the application filed under Section 10 (23C) of the Income Tax Act, 1961 (for short ‘the Act of 1961’) and the rectification application respectively.

[2024:RJ-JP:18820-DB] (2 of 3) [CW-6622/2014]

2.

The brief facts are that the petitioner is a registered Trust. During the financial year 2010-2011 the petitioner filed an application under Section 10 (23C) of the Act of 1961. Notice was issued by the Chief Commissioner of Income Tax Act, Jaipur for 16.04.2012 to show cause as to why the application be not rejected as the Trust was not solely for the educational purposes. On failure of the petitioner to respond to the notice, the application was rejected vide order dated 26.04.2012. The petitioner filed an application under Section 154 annexing an affidavit of Kishan Agarwal. It was deposed that the father of deponent was seriously ill and expired on 17.04.2012 and the hearing could not be attended. The rectification application was dismissed. Hence, the present writ petition.

3.

Learned counsel for the petitioner submits that the application was rejected on the wrong premises that the Trust is not solely for the educational purposes. The exemption was applied under Section 10 (23C)(vi) of the Act of 1961, for the income being received from an institution established solely for educational purposes. It is further argued that the order dated 26.04.2012 is a non-speaking order.

4.

Learned counsel for the respondent defends the impugned order and submits that as per the aims and objects, the Trust is involved in activities other that education.

5.

The petitioner could not avail the opportunity of hearing due to sickness and death of father of authorized representative of the Trust dealing with the matter.

6.

Without commenting upon merits of the case, the impugned orders are set-aside and the matter is remitted back to

[2024:RJ-JP:18820-DB] (3 of 3) [CW-6622/2014] the official concerned to decide the application of the petitioner filed under Section 10 (23C) of the Act of 1961 in accordance with law.

7.

The petition is allowed. (BHUWAN GOYAL), J (AVNEESH JHINGAN), J HS/RIYA/13 Reportable:- Yes

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