DHARMBHASKAR RASHTRASANT SHRIPACHLEGAVKAR MAHARJ PRATISHTAN,PUNE vs. EXEMPTION WARD 1(2), PUNE, PUNE

ITA 2799/PUN/2024Status: DisposedITAT Pune18 June 2025AY 2012-1310 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal held that the amendment to Section 12A(2) of the Income Tax Act, 1961, particularly the proviso, should be interpreted liberally and retrospectively to give effect to the legislative intention of preventing hardship in genuine cases. The Tribunal noted that the assessee was granted registration under Section 12AA on 02.12.2016, and the assessment orders were passed subsequently. While the CIT(A) had dismissed the appeal, the Tribunal observed that the lower authorities had not examined whether the objects and activities of the trust remained the same for the assessment years in question after obtaining registration. Therefore, the Tribunal set aside the impugned orders of the CIT(A) and restored the matter to the AO for re-examination. The AO is directed to re-examine the assessee's claim, specifically considering the objects and nature of activities in AYs 2011-12 and 2012-13, and allow the claim as per facts and law after providing an opportunity of hearing. The assessee is directed to file necessary documents. The common grounds of appeal raised by the assessee are allowed for statistical purposes.

What were the facts?

The assessee, Dharmbhaskar Rashtrasant Shripachlegavkar Maharaj Pratishtan, is a trust that filed returns for Assessment Years (AYs) 2011-12 and 2012-13. The Assessing Officer (AO) initially treated donations as taxable income. The matter reached the ITAT, which remanded it to the AO to consider the trust's subsequent registration under Section 12AA of the Income Tax Act, 1961. The AO again denied exemption under Sections 11 and 12, stating registration was granted on 02.12.2016, after the assessment period. The Commissioner of Income Tax (Appeals) [CIT(A)] upheld the AO's order, holding that the proviso to Section 12A(2) was not applicable as assessment proceedings were not pending before the AO on the date of registration, but rather appeals were pending before the CIT(A). The assessee appealed to the ITAT.

What were the issues?

1. Whether the trust is eligible for claiming exemption under Section 11 of the Income Tax Act, 1961, despite not being registered under Section 12A at the time of assessment, given subsequent registration under Section 12AA while proceedings were pending before the CIT(A)? (Question of law and fact, turning on Section 11 and Section 12A(2) proviso). 2. Whether the Learned CIT(A) erred in upholding the AO's order by not considering the subsequent grant of registration under Section 12AA and the legislative intent behind the amendment to Section 12A by the Finance (No. 2) Act, 2014? Assessee's contentions: The assessee argued that the proviso to Section 12A(2) allows trusts with pending assessment proceedings to claim exemptions under Sections 11 and 12 upon subsequent registration. They relied on the ITAT's previous directions and contended that the amendment to Section 12A(2) by the Finance (No. 2) Act, 2014, applies retrospectively to pending proceedings. The assessee cited the case of Sree Sree Ramkrishna Samity Vs. Deputy Commissioner of Income Tax. Revenue's contentions: The Revenue did not controvert the findings of the CIT(A) and the Tribunal's previous order. The judgment notes that the Ld. DR has not been able to controvert the findings.

Which sections of the Income-tax Act were involved?

Section 11,Section 12,Section 12A,Section 12A(2),Section 12AA,Section 2(24)(ii-a),Section 147,Section 143(3),Section 254,Section 57,Section 57(iii)

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Income Tax Appellate Tribunal, “SMC” BENCH, PUNE

Before: SHRI MANISH BORAD & MS. ASTHA CHANDRA

For Appellant: Shri Abhay Shastri & Jasraj Sutar
For Respondent: Shri Akhilesh Srivastava

PER ASTHA CHANDRA, JM : Two appeals filed by the assessee are directed against the two separate order(s) both dated 05.09.2024 of the Ld. Commissioner of Income Tax (Appeals)/NFAC, Delhi [“CIT(A)"] pertaining to Assessment Years ("AYs”) 2011-12 and 2012-13. Since the issue(s) involved in both the appeals are identical, these were heard together and are being disposed of by this common order.

2.

This is the second round of appeal before the Tribunal. Briefly stated, the facts of the case are that the assessee is

The order continues below.

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