M/S BHARTIYA SANSKRITI GYAN MANDIR ,BOKARO vs. DCIT EXEMPTION, RANCHI

1 ITA No.226/Ran/2017 IN THE INCOME TAX APPELLATE TRIBUNAL, RANCHI BENCH, RANCHI BEFORE SHRI N.S.SAINI, ACCOUNTANT MEMBER & SHRI PAVAN KUMAR GADALE, JUDICIAL MEMBER ITA No.226/Ran/2017 Assessment Year : 2014-2015 M/s Bhartiya Sanskriti Gyan vs DCIT, Exemptions Mandir PTJM Saraswati Circle, Ranchi Vidya Mandir, Sector-3C, Bokaro-827003 PAN No. : AACTB 3736 G .. Respondent (Appellant) Assessee by : Shri Devesh Poddar, Advocate Revenue by : Shri A.K.Mohanty, JCIT(Jr.DR) Date of Hearing : 26.11.2018 Date of Pronouncement : 27.11.2018

O R D E R Per Pavan Kumar Gadale, JM: The assessee has filed this appeal against the order of CIT(A),

Hazaribag, dated 15.06.2017 on the following grounds of appeal :-

2 ITA No.226/Ran/2017 2. Ld. AR of the assessee argued that the CIT(A) has erred in

confirming the rejection of registration u/s.12AA(2) of the Act and the

assessee is entitled for exemption u/s.11 of the Act and the registration

u/s.12AA of the Act is effective from 01.04.2013 or from the date of

incorporation. Ld. AR further emphasized that the AO is not correct in

rejecting the claim and the trust is registered through the office order dated

31.08.2016 effective from 30.03.2016, whereas the assessment year

under consideration being 2014-2015. Hence, the AO and CIT(A) has

came to a unilateral conclusion that the assessee is not entitled for

exemption u/s.12AA of the Act. Ld. AR further substantiated his

submissions with the paper book and referred to the order of granting

registration u/s.12AA and copy of the assessment order of the earlier

assessment year 2013-2014 dated 25.09.2017 wherein registration

u/s.12AA has been considered and accepted the return of income. Further

ld. AR filed the judicial decisions to substantiate the claim though the

registration was granted on a particular date but it is retrospectively

available to the assessee where similar proceedings are pending before

the Income-tax authorities and prayed for allowing the appeal.

record. Ld. AR’s submissions are in respect of granting registration

u/s.12AA which was considered by the income tax authorities and was

granted registration vide order dated 31.08.2016 effective from 30.03.2016.

3 ITA No.226/Ran/2017 Ld. AR further substantiated that in the assessment year 2013-2014, the

AO having considered the similar facts and has completed the assessment

u/s.143(3) of the Act and relief was granted u/s.11 of the Act. Ld. CIT(A) is

of the opinion that the registration has been granted on 31.08.2016 w.e.f

30.03.2016 and, therefore, the assessee is not entitled for exemption

u/s.11 of the Act for the assessment year 2014-2015. Ld. AR further

submitted that assessment proceedings of the assessment year 2014-2015

is pending before the AO and the AO has passed the order without

granting exemption u/s.11 of the Act dated 29.12.2016. We have perused

the provisions of Section 12A(2) of the Act which reads as under :- [“(2) Where an application has been made on or after the 1st day of June, 2007, the provisions of sections 11 and 12 shall apply in relation to the income of such trust or institution from the assessment year immediately following the financial year in which such application is made]

[Provided that where registration has been granted to the trust or institution under section 12AA, then, the provisions of sections 11 and 12 shall apply in respect of any income derived from property held under trust of any assessment year preceding the aforesaid assessment year, for which assessment proceedings are pending17 before the Assessing Officer as on the date of such registration and the objects and activities of such trust or institution remain the same for such preceding assessment year:” 5. We also support our view relying on the decision of Kolkata Bench

of the Tribunal in the case of Sree Sree Ramkrishna Samity Vs. DCIT,

[2015] 64 taxmann.com 330 (Kolkata-Trib.), where similar issue was

considered in respect of retrospective effect of registration u/s.12AA while

proceedings are pending. The observation of the Tribunal in para 6.13 is as

under :-

4 ITA No.226/Ran/2017 “6.13 We hold that since the only reason for denial of exemption u/s 11 was absence of registration u/s 12AA (which was granted to assessee society on 29.10.2010 with effect from 1.4.2010) for the relevant assessment years and on no other ground, the benefit of change in law as above by Finance Act 2014 should be available and for all the years, the benefit of exemption should be available on the date of registration as all the assessments were pending as shown above. In this connection, it requires mention specifically that all the receipts of the donation were proved on enquiry to have been received from the claimed donors and utilized for the specific purpose (construction of old age home) for which they were received. In conclusion, we hold that the insertion of the proviso to section 12A(2) of the Act has to be construed as retrospective in operation. Respectfully following the various judicial precedents relied upon and in the facts and circumstances of the case, we allow the ground nos. 3 to 8 raised by the assessee.”

assessment year under consideration, we find that the registration was

granted effective from 30.03.2016 but since the proceedings are pending,

we are of the opinion that the assessee is entitled for the exemption u/s.11

of the Act. Accordingly, we set aside the order of CIT(A) in declining the

exemption u/s.11 of the Act and direct the AO to grant exemption u/s.11 of

the Act and the applicability of the judicial decisions to the present facts of

the case and allow the grounds of appeal of the assessee.

5 ITA No.226/Ran/2017

Copy of the Order forwarded to : 1. The Appellant – M/s Bhartiya Sanskriti Gyan Mandir PTJM Saraswati Vidya Mandir, Sector-3C, Bokaro-827003 2. The Respondent –DCIT, Exemptions Circle, Ranchi 3. The CIT(A) concerned 4. CIT , concerned 5. DR, ITAT, Ranchi 6. Guard file. BY ORDER, //True Copy// SR.PS, ITAT, RANCHI