SHRI. BABBUSWAMY DAIVASTHANA,MANIPAL vs. CIT, BANGALORE

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ITA 275/BANG/2016Status: DisposedITAT Bangalore31 March 2017AY 2016-174 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal held that the CIT(Exemptions) should only examine the charitable nature of the objects when granting registration. The matter was remitted back to the CIT for fresh consideration after providing the assessee with an opportunity to be heard.

What were the facts?

The assessee, a public charitable trust, applied for registration under Section 12AA. The CIT(Exemptions) rejected the application, stating the assessee did not comply with requests for information within the given time. The assessee argued that the CIT went beyond his powers in inquiring into issues beyond the charitable nature of the objects.

What were the issues?

Whether the CIT(Exemptions) exceeded his jurisdiction by inquiring into issues beyond the charitable nature of the trust's objects during the registration process under Section 12AA.

Which sections of the Income-tax Act were involved?

Section 12AA

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘C’ BENCH, BENGALURU

Before: SHRI SUNIL KUMAR YADAV & SHRI INTURI RAMA RAO

For Respondent: Shri M.K.Biju, JCIT(DR)
Hearing: 23/02/2017Pronounced: 31/03/2017

O R D E R

Per INTURI RAMA RAO, AM :

1.

This is an appeal filed by the assessee directed against the order of the CIT(Exemptions), Bengaluru, dated 12/01/2016 passed u/s 12AA(1)(b) of the Income-tax Act,1961 [‘the Act’ for short] denying grant of registration to the assessee-trust under the provisions of section 12AA of the Act.

2.

The appellant raised the following grounds of appeal:

3. The appellant is a public charitable trust, registered under the provisions of the Societies Registration Act vide deed dated 01/07/2015. The appellant filed an application in Form 12A for registration u/s 12AA of the Act on 28/08/2015. On receipt of said application, the CIT(Exemption), Bengaluru issued a letter dated 05/10/2015 calling for certain information which was complied with by the assessee-trust vide its letter dated 15/10/2015. Subsequently, the CIT(Exemptions) through his Income-tax Officer (Exemptions) issued another letter dated 17/12/2015 calling upon the assessee to file certain details which has not been complied with by the assessee-trust. Therefore, the CIT(Exemption) presumed that the assessee was not interested in prosecution of the application and on this reason, the application was rejected.

4.

Being aggrieved, the assessee is before us in the present appeal. Learned counsel for assessee vehemently argued that the CIT(Exemptions) has gone beyond his power to inquire into issues which have to be considered only at the stage of the assessment of the trust. She further argued that at the time of Page 4 of 4 granting registration u/s 12AA, the CIT(Exemptions) is only expected to look at the objects whether charitable in nature or not. It was submitted that the assessee could not submit required details for want of sufficient time. Therefore, prayed that the issue may be restored back to the file of the CIT(Exemptions) for de novo examination. The learned DR has no serious objection for sending back the matter for de novo examination by the CIT(Exemption). In the circumstances, we remit the issue back to the file of the CIT(Exemption) for de novo consideration of the application after affording due opportunity of being heard to the assessee.

5.

In the result, the appeal of the assessee is treated as partly allowed for statistical purposes.

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