ITO, Bangalore V. St. George Educational & Charitable Trust, Bangalore

ITA 1305/BANG/2015

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 8555 (ITAT-BANGALORE)
• Duration Of Justice: 1 year(s) 3 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-02-2017
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 29-09-2016
• Assessment Year: 2010-2011
• Appeal Filed On: 02-11-2015
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: B.S. SUDHEENDRA
• Keywords: Charitable institution; Opportunity of being heard; Benefit of exemption
• Section: 32; 147; 131; 68; 246; 69; 145; 27; 148; 54; 37; 6; 56; 263; 63; 132; 12; 28; 144; 10; 90; 154; 2; 11; 15; 271(1)(b); 139; 92; 12A; 12AA; 22

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH : BANGALORE BEFORE SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI S. JAYARAMAN, ACCOUNTANT MEMBER ITA NO.1305/BANG/2015 ASSESSMENT YEAR : 2010-11 THE INCOME TAX OFFICER (EXEMPTIONS), WARD-3, BANGALORE. VS. ST. GEORGE EDUCATIONAL & CHARITABLE TRUST, OMBR LAYOUT, III MAIN, IV CROSS, BANASWADI, BANGALORE 560 043. PAN: AACTS 8131J APPELLANT RESPONDENT APPELLANT BY : SMT. SWAPNA DASS, JCIT (DR) RESPONDENT BY : SHRI B.S. SUDHEENDRA, CA DATE OF HEARING : 28.12.2016 DATE OF PRONOUNCEMENT : 22.02.2017 O R D E R PER SUNIL KUMAR YADAV, JUDICIAL MEMBER THIS APPEAL IS PREPARED BY THE REVENUE AGAINST THE ORDER OF THE CIT(APPEALS) INTER ALIA ON THE FOLLOWING GROUNDS:- 1) THE ORDER OF THE LEARNED CIT(A) IS OPPOSED TO THE LAW AND FACTS OF THE CASE. 2) THE LEARNED CIT(A) ERRED IN HOLDING THAT THE AS SESSEE TRUST WAS ENTITLED TO BE REGISTERED U/S 12AA OF THE INCOM E TAX ACT AND THEREBY THE PROVISIONS OF SECTION 11 & 12 ARE A PPLICABLE TO THE FACTS OF THE CASE WITHOUT APPRECIATING THE FACT THAT THE ORDER OF THE HONBLE HIGH COURT IN ITA NO. 899/2006 DATED ITA NO.1305/BANG/2015 PAGE 2 OF 4 06/08/2012 HAS NOT BEEN ACCEPTED BY THE DEPARTMENT AND THE DEPARTMENT HAS FILED A SLP BEFORE THE HONBLE SUPRE ME COURT. 3) THE LEARNED CIT(A) ERRED IN NOT APPRECIATING TH E FACT THAT THE DEPARTMENT HAS PREFERRED A STAY PETITION BEFORE THE HONBLE SUPREME COURT ON OPERATION OF THE ORDER OF THE HON BLE HIGH COURT OF KARNATAKA AND HENCE REGISTRATION U/S 12AA IS NOT YET GRANTED TO THE ASSESSEE TILL DATE. 4) ANY OTHER GROUNDS WHICH MAY ARISE AT THE TIME O F HEARING. 5) THE ORDER OF THE LEARNED CIT(A) MAY BE SET-ASID E AND THE ORDER OF THE AO MAY BE CONFIRMED. 2. DURING THE COURSE OF HEARING THE LD. COUNSEL FOR THE ASSESSEE HAS INVITED OUR ATTENTION TO THE FACT THAT AO HAS DENIE D THE BENEFIT OF EXEMPTION U/S 11 OF THE ACT ON THE GROUND THAT THE REGISTRATI ON U/S 12AA WAS DENIED BY THE CIT(EXEMPTIONS). THE ASSESSEE HAS FILED APPE AL AGAINST THE ORDER OF CIT(A) DENYING THE EXEMPTION BEFORE THE TRIBUNAL . THE TRIBUNAL HAS GRANTED REGISTRATION U/S 12A OF THE ACT. THE REVEN UE WENT IN APPEAL BEFORE THE HONBLE HIGH COURT OF KARNATAKA AND THE HONBLE HIGH COURT ALSO DISMISSED THE APPEAL OF THE REVENUE. THEREFOR E, EXEMPTION U/S 11 SHOULD BE ALLOWED TO THE ASSESSEE IN THE LIGHT OF R EGISTRATION U/S 12AA GRANTED BY THE TRIBUNAL. COPY OF THE ORDER OF THE TRIBUNAL AND THE JUDGMENT OF THE HONBLE HIGH COURT OF KARNATAKA IS PLACED ON RECORD. 3. THE LD. DR HAS CONTENTED THAT UNDER THESE CIRCUM STANCES THE MATTER IS TO BE RESTORED BACK TO THE AO TO EXAMINE THE GRO UND OF EXEMPTION IN THE LIGHT OF RELEVANT PROVISIONS OF THE ACT AS HE HAS N OT APPLIED HIS MIND TO THE PROVISIONS OF THE ACT WHILE DENYING THE EXEMPTION U /S 11 OF THE ACT. ITA NO.1305/BANG/2015 PAGE 3 OF 4 4. HAVING CAREFULLY EXAMINED THE ORDERS OF THE LOWE R AUTHORITIES, WE FIND THAT UNDISPUTEDLY EXEMPTION WAS DENIED BY THE AO ON THE GROUND THAT REGISTRATION U/S 12AA WAS DENIED BY THE CIT(E). NO W THE REGISTRATION U/S 12AA HAS BEEN GRANTED TO THE ASSESSEE BY THE TRIBUN AL AND WAS ALSO UPHELD BY THE HONBLE JURISDICTIONAL HIGH COURT. T HEREFORE, THE EXEMPTION U/S 11 OF THE ACT REQUIRES TO BE RE-EXAMINED AFRESH IN THE LIGHT OF REGISTRATION GRANTED TO THE ASSESSEE. WE ACCORDING LY SET-ASIDE THE ORDER OF CIT(A) AND RESTORE THE MATTER BACK TO THE FILE OF A O WITH A DIRECTION TO READJUDICATE THE CLAIM OF EXEMPTION U/S 11 OF THE A CT IN THE LIGHT OF THE FACT THAT REGISTRATION U/S 12AA HAS BEEN GRANTED TO THE ASSESSEE. NEEDLESS TO MENTION HERE THAT PROPER OPPORTUNITY OF BEING HEARD BE ALSO AFFORDED TO THE ASSESSEE WHILE ADJUDICATING THE CLAIM OF EXEMPTION. 5. IN THE RESULT THE APPEAL OF REVENUE IS ALLOWED F OR STATISTICAL PURPOSES. PRONOUNCED IN THE OPEN COURT ON THIS 22 ND DAY OF FEBRUARY, 2017. SD/- SD/- ( S. JAYARAMAN ) (SUNIL KUMAR YA DAV ) ACCOUNTANT MEMBER JUDIC IAL MEMBER BANGALORE, DATED, THE 22 ND FEBRUARY, 2017. / M S / ITA NO.1305/BANG/2015 PAGE 4 OF 4 COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT, BANGALORE. 6. GUARD FILE BY ORDER ASSISTANT REGISTRAR, ITAT, BANGALORE.