CITIZEN EDUCATIONAL TRUST,SALEM vs. DCIT,CPC, BENGALURU

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ITA 361/CHNY/2021Status: DisposedITAT Chennai23 December 2022AY 2016-174 pages
AI SummaryDismissed

What did the Tribunal hold?

The Tribunal confirmed the CIT(A)'s order, upholding the disallowance of exemption under Section 11 because the trust lacked the mandatory registration under Section 12AA.

What were the facts?

The assessee trust, not registered under Section 12AA of the Income Tax Act, claimed exemption under Section 11 while filing a belated return. The CPC disallowed this claim during processing under Section 143(1).

What were the issues?

Whether exemption under Section 11 can be claimed without registration under Section 12AA. Whether an alternative claim under Section 10(23C)(iiad) can be considered when not raised before lower authorities.

Which sections of the Income-tax Act were involved?

Section 11,Section 12AA,Section 143(1)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘C’ BENCH, CHENNAI

Before: SHRI MAHAVIR SINGHAND SHRI MANOJ KUMAR AGGARWAL

Hearing: 19.12.2022Pronounced: 23.12.2022

आदेश /O R D E R

PER MAHAVIR SINGH, VICE PRESIDENT:

1.

This appeal by the assessee is arising out of the order of the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi in Appeal No.CIT(A), Salem/10016/2019-20 dated 08.09.2021. The return of income filed by assessee on 23.08.2017 for the assessment year 2016-17, which was processed

- 2 - Central Processing Center (CPC), Bangalore by issuing intimation u/s.143(1) of the Income Tax Act, 1961, (hereinafter ‘the Act’) dated 30.04.2018.

2.

The only issue in this appeal is as against the order of CIT(A) confirming the action of AO i.e., DCIT, CPC, Bangalore u/s.143(1)(a) of the Act in denying the claim of exemption u/s.11 of the Act in the absence of the trust not registered u/s.12AA of the Act.

3.

Briefly stated facts are that the assessee trust is not registered u/s.12AA of the Act but while filing return of income i.e., belated return filed on 23.08.2017 as against the due date of filing of return u/s 139(1) of the Act was 17.10.2016 for the relevant assessment year 2016-17, claimed exemption u/s.11 of the Act. The assessee declared income from other sources at Rs.44,56,750/- and in the absence of any registration u/s.12AA of the Act, the CPC while processing the return u/s.143(1) of the Act, disallowed the claim of exemption and charged the entire income to tax vide order dated 30.04.2018. The CIT(A) confirmed the action of the AO by observing as under:- “6.6 In the instant case of the appellant, as admitted by the assessee itself, that during the A.Y. under consideration, the assessee trust was not - 3 - 12AA. The assessee tried to take advantage of exemptions u/s 11 and 12, by making false claim at the time of filing ITR that during the A.Y. under consideration, the assessee trust was registered u/s 12AA. In the absence of registration u/s 12AA, the AO-CPC has rightly denied the claims of exemption u/s 11 and 12, made by the assessee in the ITR filed by it. In view of the same, all the Grounds of appeal are dismissed.”

Aggrieved, assessee came in appeal before the Tribunal.

4.

Before us, the ld.counsel for the assessee Shri S. Sridhar stated that the assessee has no registration u/s.12AA of the Act, but he made alternative claim that the assessee being a trust, engaged in running only educational institutions and is not for the purpose of profit. Therefore according to him, the matter can be restored back to the file of the AO for examining whether the assessee exist for running only educational institutions and not in existence for the purpose of profit.

5. We noted that the CIT(A) has considered this aspect and noted that the alternate claim made by assessee u/s.10(23C)(iiad) of the Act. The assessee never made claim of such exemption in the income-tax return filed or before AO in its rectification application u/s.154 of the Act dated 11.10.2018. In view of the facts, we find

- 4 - CIT(A) and in the absence of any registration u/s.12AA of the Act, we confirm the order of CIT(A) and dismiss this appeal by assessee.

5.

In the result, the appeal filed by the assessee is dismissed.

Order pronounced in the open court on 23rd December, 2022 at Chennai.

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