GURUDWARA SHRI BAULI SAHIB,ZIRAKPUR vs. CIT(EXEMPTION), CHANDIGARH

The present appeal has been filed by the assessee wherein the correctness of the order dated 16.09.2020 of CIT (Exemptions) Chandigarh is assailed on the following grounds :

That on the facts, circumstances and legal position of the case, the Worthy

1. CIT(E) in its order dated 16.09.2020 has erred in passing that order in contravention of the provisions of Section 12AA of the Income Tax Act, 1961.

2. That on law, facts and circumstances of the case, the Worthy CIT(E) has erred in not granting registration u/s 12AA to the appellant even when the objects as well as activities of the appellant clearly fell in the definition of "charitable purpose" propounded u/s 2(15) of the Income Tax Act, 1961.

3. That on law, facts and circumstances of the case, the Worthy CIT(E) has erred in not granting registration u/s 12AA of the Act to the appellant by erroneously holding that the activities carried out by the appellant are not genuine as proper books of accounts are not maintained by the appellant and due to non-production of ITRs by the appellant and that too without considering the submissions made by the appellant.

4. That the appellant craves leave for any addition, deletion or amendment in the grounds of appeal on or before the disposal of the same.”

2. The ld. AR inviting attention to the impugned order submitted that the assessee is an ongoing entity since 2006

ITA 328 /CHD/2020 Page 2 of 4 which fact has been noticed by the CIT(E) and the assessee filed an application seeking 12AA registration by e-filing Form No.10 on 11.11.2019. Reading from the order, it was submitted, that the ld. CIT(E) issued a questionnaire to the assessee requiring certain details which have been set out in the order itself.

Specific attention was invited to Question No.16 wherein returns for the last three years were required to be filed.

2.1 Referring to the finding arrived at in the impugned order, it was submitted that the registration has been denied on various grounds which do not constitute a relevant criteria. Apart from that, the ground for rejection has been not filing returns for last six years. The rejection was stated to be arbitrary as the requirements spelt out by the ld. CIT (E) itself in the order was three years’ returns to be filed. Hence, the reason for denial, it was submitted, based on this fact alone is an arbitrary exercise.

Even otherwise, it was his submission that a discussion on the financial statements and observations that the FDs etc. were not reconciled was an irrelevant discussion. The only issues in terms of the settled legal position which the ld. CIT (E) was required to address in the order was the objects of the Trust and the activities.

2.2 Considering the lack of discussion or supporting documents, the ld. AR was required to address the Bench on the stated Aims and Objects of the entity. The ld. AR submitted that ITA 328 /CHD/2020 Page 3 of 4 he would be in a position to file the same and readily it is not available. As noticed on a reading of the order, it is seen that there is no discussion on the objects of the Trust or its activities.

Accordingly, after hearing the ld. CIT-DR and the ld. AR, it was deemed appropriate to set aside the order back to the file of the CIT(E) with a direction to pass a speaking order in accordance with law after giving the assessee a reasonable opportunity of being heard.

Order pronounced in the Open Court on 30th November, 2022.