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Income Tax Appellate Tribunal, INDORE BENCH, INDORE
Before: SHRI MAHAVIR PRASAD & SHRI B.M. BIYANI
आदेश / / O R D E R O R D E R / / O R D E R O R D E R
Per B.M. Biyani, A.M.:
This appeal filed by the assessee is directed against the order dated 27.05.2021 in Form No. 10AC of learned Principal Commissioner of Income- Tax, Bhopal [“Ld. PCIT”] under Clause (iv) of First Proviso to Section 10(23C) for grant of approval under sub-clause (vi) of section 10(23C) of the Income- tax Act, 1961 [“the Act”].
The assessee has raised following grounds: “1. The Ld. PCIT has erred in not granting the registration u/s 10(23C) with a retrospective effect when all the conditions were fulfilled.
Barkatullah Vishvavidhyalaya ITA No.146/Ind/2021
The Ld. PCIT consider the prayer of the assessee for granting the registration since its inception.
The assessee was under a genuine belief that the assessee is entitled for exemption u/s 10(23C)(iiiab) and as such there was a delay in filing the application.
The exemption may please be granted with retrospective effect.” 3. The assessee is a University established under M.P. Vishwavidhalaya Adhiniyam, 1973, an Act of the State Govt. of Madhya Pradesh. The activities of assessee are to provide education, supervision and maintenance to various colleges and educational institutions as per regulations of the Govt. and to establish, maintain and manage colleges, teaching departments, school of studies, center of studies, to institute degree diplomas, certificates and other academic distinctions, etc. The assessee filed an application to Ld. PCIT under Clause (iv) of First Proviso to Section 10(23C) for grant of approval under sub-clause (vi) of section 10(23C) of the Income-tax Act, 1961. The Ld. PCIT granted approval vide order dated 27.05.2021 for assessment-year 2021-22 to 2023-24. The assessee is aggrieved by this order in as much as the approval has been granted from assessment-year 2021-22 and not from retrospective date since inception of the assessee. Hence the assessee has filed present appeal against the order dated 27.05.2021 passed by Ld. PCIT.
Ld. AR appearing on behalf of assessee submitted that the assessee is a university entitled to exemption u/s 10(23C). The assessee was having a genuine belief that it would be entitled for exemption under sub-clause (iiiab) of section 10(23C) and hence did not feel necessity of obtaining approval under sub-clause (vi) of section 10(23C). But later when the assessee came to know that unnecessary litigation is entailed in the matter of exemption under sub-clause (iiiab) of section 10(23C), it decided to move an application to Ld. PCIT seeking approval under sub-clause (vi) of section 10(23C) since inception. Ld. AR submitted that such genuine belief of assessee led to delay in filing application, otherwise there was no ill-intention or motive of assessee. Ld. AR further argued that section 10(23C) is a beneficial provision Page 2 of 4
Barkatullah Vishvavidhyalaya ITA No.146/Ind/2021 and having regard to its object to incentivize the educational institutions, the delay ought to have been condoned and approval must have been granted with retrospective date since inception. But the Ld. PCIT has granted approval from assessment-year 2021-22 onwards which is not justified.
Ld. DR did not make any specific submission and left the matter to the wisdom of the Bench.
We have considered the arguments of Ld. AR and also gone into the provisions of section 10(23C) effective from time to time, to the extent relevant to us. We observe that vide Finance Act, 2006 the following Proviso has been introduced in section 10(23C) w.e.f. 01.06.2006:
“Provided also that in case the fund or trust or institution or any university or other educational institution or any hospital or other medical institution referred to in the first proviso makes an application on or after the 1st day of June, 2006 for the purposes of grant of exemption or continuance thereof, such application shall be made on or before 30th day of September of the relevant assessment year from which the exemption is sought.”
This proviso is applicable from assessment-year 2007-08. The impact of this proviso is such that an assessee has to file application for grant of approval latest by 30th September of the assessment year from which the exemption is sought. In other words, the last date for filing of application is 30th September of assessment year from which exemption is sought and thereafter application cannot be filed for that assessment-year. We observe that this new Proviso has been introduced by the Govt. with a specific purpose to make the system of approval time-bound, straight forward and to avoid delays in filing applications by the assessees. We confronted the Ld. AR to show us any provision for condonation of delay after introduction of this new Proviso from 01.06.2006 to which the Ld. AR could not find any. Obviously there is no provision to condone the delay.
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Barkatullah Vishvavidhyalaya ITA No.146/Ind/2021 7. Reverting back to the facts, the Ld. PCIT has allowed exemption from assessment-year 2021-22 onwards on the basis of application filed by the assessee. Therefore, the Ld. PCIT is justified in not granting registration from a retrospective date since inception. We do not find any mistake in the order passed by Ld. PCIT.
In the result, this appeal of assessee is dismissed.
Order pronounced as per Rule 34 of I.T.A.T. Rules 1963 on 30.06.2022.
Sd/- Sd/-
(MAHAVEER PRASAD) (B.M. BIYANI) JUDICIAL MEMBER ACCOUNTANT MEMBER
Indore Dated : 30.06.2022 Patel/Sr. PS Copies to: (1) The appellant (2) The respondent (3) CIT (4) CIT(A) (5) Departmental Representative (6) Guard File By order UE COPY
Sr. Private Secretary Income Tax Appellate Tribunal Indore Bench, Indore
Date of taking dictation
Date of typing & draft order placed before the Dictating Member
Date on which the approved draft comes to the Sr. P.S./P.S.
Date on which the fair order is placed before the Dictating Member for pronouncement
Date on which the file goes to the Bench Clerk
Date on which the file goes to the Head Clerk
Date on which the file goes to the Assistant Registrar for signature on the order
Date of dispatch of the Order
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