Commissioner Of Income Tax vs. R.K.D.F.Educational Society

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MAIT/11/2008HC Madhya Pradesh16 January 2014Author: HON'BLE SHRI JUSTICE AJIT SINGH1 pages
For Petitioner: Sanjeev Tuli, Sanjay Lal
AI SummaryDismissed

What did the High Court hold?

The Tribunal decided that the Commissioner of Income Tax ought to have granted registration to the assessee society with effect from April 1, 2004, the date of its creation. The reasoning was that the Commissioner was satisfied with the assessee's objects concerning public welfare. The Tribunal held that denying registration from the inception would defeat the very purpose of the provisions related to charitable and educational trusts. The High Court found itself in complete agreement with the Tribunal's view, considering it well-founded and unassailable. The learned counsel for the appellant (revenue) could not point out any illegality in the impugned order. No substantial question of law arose. The appeal was accordingly dismissed summarily.

What were the facts?

The assessee, a society established on September 25, 2003, with educational and charitable objects for public benefit, applied for registration under Section 12AA of the Income Tax Act, 1961. The Commissioner of Income Tax granted registration on May 31, 2006, but with effect from April 1, 2005, instead of the requested April 1, 2004. The assessee appealed this decision. The Income Tax Appellate Tribunal (ITAT), Indore Bench, in its order dated August 10, 2007, partly allowed the assessee's appeal, directing the Commissioner to grant registration from April 1, 2004. The present appeal is against this ITAT order.

What were the issues?

1. Whether the Tribunal erred in directing the Commissioner of Income Tax to grant registration under Section 12AA of the Income Tax Act, 1961, with effect from April 1, 2004, instead of April 1, 2005. Assessee's contention: The assessee argued that registration should be granted from the date of its creation (April 1, 2004), as the Commissioner was satisfied with its objects for public welfare. Denying registration from the inception would defeat the purpose of the provision. Revenue's contention: The judgment records no specific contentions from the revenue regarding this issue.

Which sections of the Income-tax Act were involved?

Section 12AA

AI-generated summary — verify with the full judgment below

MAIT No.11/2008 16.1.2014

Shri Sanjay Lal, Advocate, for the appellant.

Heard on admission.

This appeal is directed against the order dated 10.8.2007 passed by the Income Tax Appellate Tribunal, Indore Bench (in short, “the Tribunal”) whereby it has partly allowed the respondent’s ITA No.98/IND/2007. The respondent-assesse is a society which was created on 25.9.2003 with the main objects being educational and charitable for the benefit of general public. The respondent applied for registration on 18.10.2005 and the Commissioner of Income Tax granted registration to it under section 12AA of the Income Tax Act, 1961 vide order dated 31.5.2006. The Commissioner granted registration with effect from 1.4.2005 instead of 1.4.2004. Aggrieved, the respondent preferred an appeal before the Tribunal. The Tribunal, after considering the explanation of respondent and relying upon number of decisions, directed the Commissioner of Income Tax to grant registration to the respondent with effect from 1.4.2004 within two months. The Tribunal has held that the Commissioner was satisfied about the respondent’s object regarding welfare of the public and, therefore, ought to have granted registration with effect from the date of creation of Trust, otherwise the very purpose of such provision would be defeated.

We find ourselves in complete agreement with the view taken by the Tribunal which is well-founded and unassailable. The learned counsel for appellant could not point out any illegality in the impugned order. No substantial question of law arises in the present appeal.

It is accordingly dismissed summarily.

(AJIT SINGH)

(SUBHASH KAKADE) JUDGE

JUDGE ps

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