ITO(EXEMPTION) WARD-1, CHENNAI vs. HINDUSTAN CHAMBER OF COMMERCE, CHENNAI

सुनवाई क� तार�ख/Date of hearing : 06.02.2020 घोषणा क� तार�ख /Date of Pronouncement : 13.02.2020 आदेश /O R D E R PER INTURI RAMA RAO, ACCOUNTANT MEMBER:

These appeals filed by the Revenue are directed against the common order of the Commissioner of Income Tax (Appeals)- 9,Chennai, (in short ‘CIT(A)’) dated 20.03.2019 for the Assessment Years 2013-14 & 2015-16.

2 & 2087/Chny/2019 2. The brief facts of the case are the respondent assessee namely M/s. Hindustan Chamber of Commerce is a company registered U/s.25 of the Companies Act. It was enjoying the registration U/s.12AA of the Income Tax Act, 1961 (in short ‘the Act’). Subsequently, it was cancelled by the DIT(Exemption), Chennai and this cancellation of registration was quashed by this Tribunal vide order dated 23.07.2017 in ITA No.670/Mds/2017. At the time of completion of assessment proceedings, the assessee was not enjoying registration U/s.12AA of the Act. Consequently, the AO brought to tax the excess of income over expenditure and the Long Term Capital Gains on sale of the property and accordingly completed the assessment vide order dated 21.03.2016 for the assessment year 2013-14 and vide order dated 21.12.2017 for the assessment year 2015-16. Being aggrieved, by the above assessment orders, appeals was preferred before the CIT(A), who vide impugned order taking into consideration the order passed by the Tribunal restoring the registration U/s.12AA of the Act and allowed the appeals of the assessee by holding that once the assessee makes fixed deposit out of the sale proceeds of the asset, it amounts to application of income of charitable trust.

3 & 2087/Chny/2019 3. Being aggrieved, the Revenue is in appeal before us challenging the correctness of the decision of the CIT(A). It is submitted that the AO had no occasion to examine the applicability of proviso to Section 2(15) of the Act and the CIT(A) ought not have granted the relief.