M/S. ORISSA INDUSTRIES ASSOCIATION,CUTTACK vs. CIT(EXEMPTIONS), HYDERABAD

IN THE INCOME TAX APPELLATE TRIBUNAL, CUTTACK BENCH, CUTTACK

BEFORE S/SHRI N.S SAINI, ACCOUNTANT MEMBER AND PAVAN KUMAR GADALE, JUDICIAL MEMBER

ITA No. 24/CTK/2016

Orissa Industries Vs. CIT (Exemptions), Association, New Industrial Hyderabad Estate, Jagatpur. PAN/GIR No. (Appellant) .. ( Respondent)

Assessee by : Shri Gouri Mohan Rath, AR Revenue by : Shri Kunal Singh, CIT DR

Date of Hearing : 09/08/ 2017 Date of Pronouncement : 11 /08/ 2017

O R D E R Per N.S.Saini, AM This is an appeal filed by the assessee against the order of the CIT

(Exemptions), Hyderabad Bhubaneswar dated 28.9.2015.

Hyderabad was not justified in rejecting application for registration

u/s.12AA of the Act as all the conditions required u/s.12AA are fulfilled by

the assessee.

application in Form No.10A seeking registration u/s.12AA of the Act.

required the assessee to provide details of amendment clause and

dissolution clause in the Memorandum of Association alongwith detailed

note thereon.

(Exemptions) observed that” amendment clause” does not specifically

stipulate that the amendments shall be carried out only with the prior

approval of the CIT( E). He further observed that “Winding up clause”

does not specifically stipulate that on winding up of the society, the

remaining assets shall be transferred/paid to an institution having

registration u/s.12AA and approval u/s.80G(5) of the I.T.Act, 1961.

Hence, he rejected the application of the assessee society for grant of

registration u/s.12AA of the Act.

Association and submitted that Article No.XVI provides for “Amendment

clauses” and Article No.XXII provides for “dissolution clauses” of the

society. Hence, he prayed that CIT(E) was not justified in refusing

registration to the assessee society u/s.12AA of the Act and prayed that

his order should be set aside and the CIT (E) be directed to grant

registration.

authorities and materials available on record. In the instant case, the

CIT(E) refused to grant registration to the assessee society u/s.12AA of

the assessee on the following grounds:

(i) The amendment clause in the Memorandum of Association (MOA) of the assessee society does not provide that amendments to the MOA shall be carried out with the prior approval of the CIT(Exemption).

(ii) The Winding Up clause in the MOA of the assessee society does not stipulate that on winding up the society, the remaining assets shall be transferred or paid to an institution having registration u/s.12AA of the Act and having approval u/s.80G of the Act.

amendment clause of the MoA of the assessee society does not provide

for prior approval of the CIT(Exemption). We find that there is no such

provision u/s.12AA of the Act and, therefore, in our considered view, the

CIT(Exemption) is not justified in rejecting application for registration of

the assessee society on this ground.

has stated that MoU does not contain dissolution clause. On perusal of

MoA, we find that the dissolution clause which reads as under:

“The Association may be dissolved of a General Meeting specially called for the purpose either by the Executive Committee or upon requisition by one third number of members provided that two third members present, vote for the same. Upon dissolution of the Association its assets will be handed over to a similar registered society or to the Government after clearing up all its debts and liabilities, subject to the income Tax Act and any other statue as may be applicable.”

A bare perusal of dissolution clause show that it provides that in the event

of dissolution of the assessee society, all assets will be handed over to a

similar registered society or to the Government. Thus, we find that the

CIT(E) was not justified in refusing to grant registration u/s.12AA of the

Act on this ground also.

grant registration u/s.12AA of the Act to the assessee society is not

proper and justified. Hence, we set aside the order of the

CIT(Exemption), Hyderabad and direct him to grant registration u/s.12AA

of the Act to the assessee society. Thus, the ground of appeal of the

assessee is allowed.

Order pronounced in the open court on 11/08/2017.

Sd/- sd/- (Pavan Kumar Gadale) (N.S Saini) JUDICIALMEMBER ACCOUNTANT MEMBER Cuttack; Dated 11 /08/2017 B.K.Parida, SPS Copy of the Order forwarded to : 1. The Appellant : Orissa Industries Association, New Industrial Estate, Jagatpur 2. The Respondent. CI (E) Hyderabad. 3. The CIT(A)- 4. Pr.CIT- 5. DR, ITAT, Cuttack 6. Guard file. //True Copy// BY ORDER,

SR.PRIVATE SECRETARY ITAT, Cuttack