ICMAI REGISTERED VALUERS ORGANISATION,NEW DELHI vs. CIT(EXEMPTION), NEW DELHI

The captioned appeal has been filed at the instance of the assessee trust seeking to challenge the order passed u/s. 12 AA (1) (b) r.w.s. 12 A of the Income Tax Act, 1961 dated 25.03.21 passed against the order of the Commissioner of Income Tax (Exemption), New Delhi (‘CIT(E)’ in short).

When the matter was called for hearing the Ld. Counsel for the assessee submitted that CIT(E) misdirected himself in law and on facts for denial of registration of the assessee u/s. 12 AA (1) (b) r.w.s. 12A of the Income Tax Act, 1961 without any sustainable grounds. It was submitted that the CIT(E) has committed error in not appreciating the fact that the main activities of the assessee of the assessee inter alia includes “Providing valuers course” to create skilled registered valuers in the country. It was contended that the fruits of various activities like training, seminars could be available to the public at large without any profit motive and for that purpose the assessee is registered u/s. 8 of the Companies Act, 2013 and is a wholly owned subsidiary of the Institute of Cost Accountant of India and registered with Insolvency and Bankruptcy Board of India (IBBI) framed with the objective of educating, regulating and monitoring the discipline of registered valuers. It was submitted that the registration sought under section 12AA could not be denied to the assessee where on similar facts, various other organizations like ICAI registered valuers organization, Indian Institute of Insolvency Professionals of ICAI, ICSI Insolvency Professional agency, Practising Valuers Association of India carrying similar objects as that of assessee, have been duly granted registration. Assessee thus urged that the action of the CIT(E) be reversed and application made u/s.12AA be entertained and registering authority be directed to register the assessee under section 12AA of the Act.

The Ld. CIT (DR) for the revenue, on the other hand, contended that the assessee has failed to discharge the onus which lay upon it to support its claim of registration u/s. 12AA of the Act before the CIT (E) and thus the revenue had no option left in the matter. It was contended that the action of the CIT(E) cannot assailed for the failure on the part of the assessee to support its application with factual aspects.

We have carefully considered the rival submissions. From a bare reading of the impugned order under section 12AA of the Act, it appears that the assessee has failed to respond to the requirements of the CIT(E) to enable him to appreciate the relevant facts for the purposes of registration. However, in the same vain, we simultaneously notice that the assessee has filed certain replies IN DAK before the CIT(E). On a reading of the impugned order, it appears that the CIT(E) has taken a view against the assessee unilaterally and without taking note of the main objects of the assessee as well as the decisions rendered in other cases placed in similar situation as claimed. The impugned order appears to be somewhat cryptic and requires elucidation on facts and law. We, therefore, deem it appropriate to restore the matter back to the file of the CIT(E) / other competent registering authority in force to examine matter denovo after taking cognizance of the factual position and contentions of the assessee. It shall be upon to the assessee to submit all relevant facts and its contentions before registering authority. The registering authority shall pass speaking order in accordance with law after taking note of the various submissions and contentions of the assessee. The impugned order under section 12AA (1) (b) r.w.s. 12A under challenge is thus set aside in terms observations hereinabove.

In the result, the appeal of the assessee is allowed for statistical purpose.