Lady Kikabai Premchand Iyambail Trust, Pune V. Income-tax Officer, (Exempt),Ward - 1, Pune

ITA 1403/PUN/2019

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 8516 (ITAT-PUNE)
• Duration Of Justice: 3 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-01-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2012-2013
• Appeal Filed On: 23-09-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: BHARAT DEORAJ SH E G AONKAR
• Keywords: Benefit of exemption
• Section: 143(3); 12A; 12AA; 13; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH SMC , PUNE BEFORE SHRI ANIL CHATURVEDI, ACCOUNTANT MEMBER . / ITA NO. 1403 / PUN/201 9 / ASSESSMENT YEAR : 20 12 - 13 LADY KIKABAI PREMCHAND IYAMBAIL TRUST C/O ADV. D.Y. PANDIT, 1187/10, KRUPA, SHIVAJINAGAR, PUNE 411005 PAN : A AATL4899A . . / APPELLANT V/S THE INCOME TAX OFFICER (EXEMPT) , WARD 1, PUNE . / RESPONDENT ASSESSEE BY : SMT. DEEPA KHARE REVENUE BY : S H RI BHARAT DEORAJ SH E G AONKAR DCIT (DR) / ORDER PER ANIL CHATURVEDI, AM : THIS APPEAL PREFERRED BY THE ASSESSEE EMANATES FROM THE ORDER OF THE LD. CIT(A), PUNE - 10 , DATED 1 6.0 7 .201 9 , FOR THE ASSESSMENT YEAR 2012 - 13. 2. THE RELEVANT FACTS AS CULLED OUT FROM THE MATERIAL ON RECORD ARE AS UNDER : - / DATE OF HEARING : 2 0 . 0 1.20 20 / DATE OF PRONOUNCEMENT: 21 . 0 1 .20 20 2 ITA NO.1403/PUN/2019 ASSESSEE IS A TRUST WHICH FILED ITS RETURN OF INCOME FOR A . Y 20 12 - 13 ON 13 . 08 .20 12. THE CASE WAS SELECTED FOR SCRUTINY AND THEREAFTER ASSESSMENT WAS FRAMED U/S 143(3) OF THE INCOME - TAX ACT , 1961 (HEREINAFTER REFERRED TO AS THE ACT) VIDE ORDER DATED 20 . 0 3.201 5 AND THE TOTAL INCOME WAS DETERMINED AT RS . 7,79,620 / - . AGGRIEVED BY THE ORDER OF ASSESSING OFFICER , ASSESSEE CARRIED THE MATTER BEFORE LD.CIT(A), WHO VIDE ORDER DATED 16 . 07 .201 9 ( IN APPEAL NO. PN/CIT(A)10/ITO EXMP WD1/223/15 - 16/322 ) DISMISSED THE APPEAL OF ASSES SEE . AGGRIEVED BY THE ORDER OF LD.CIT(A), THE ASSESSEE IS NOW IN APPEAL AND HAS RAISED THE FOLLOWING GROUNDS: - 1 ) WHETHER THE APPELLANT HAVING BEEN GRANTED REGISTRATION U/S 12AA OF THE INCOME TAX ACT VIDE ORDER DATED 30.09.2015, BY CIT (EXEMPT) DURING THE PENDENCY OF PROCEEDINGS BEFORE CIT (A), WOULD BE ENTITLED TO EXEMPTION U/S 11 OF THE ACT FOR THE YEAR UNDER CONSIDERATION I.E. AY 2012 - 13 IN VIEW OF THE PROVISO TO SUB - SECTION (2) OF SEC 12 AND THE PROVISIONS OF SECTION 11 AND 12 WOULD APPLY ACCORDINGLY. 2 ) IN VIEW OF THE FACTS ON RECORD THAT WHEN THE APPLICATION U/S 12AA WAS MADE BY THE ASSESSEE TRUST ASSESSMENT PROCEEDINGS FOR ASST. YEAR 2012 - 13 WERE PE NDING BEFORE ASSESSING OFFICER AND WHEN CIT (EXEMPT) GRANTED REGISTRATION U/S 12AA TO THE TRUST THE CIT (A ) 10 SHOULD HAVE DIRECTED ASSESSING OFFICER TO RECTIFY THE ASST. ORDER OF 2012 - 13 WHICH WAS PASSED SUBSEQUENTLY BY A.O BY APPLYING PROVISIONS OF SEC 11& 12 OF THE ACT BECAUSE SUB(2) OF 12A IS APPLICABLE TO PENDING ASSESSMENT PROCEEDINGS. BOTH THE GROUNDS BEING INTERCONNECTED ARE CONSIDERED TOGETHER. 3 . DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER NOTICED THAT THE ASSESSEE HAD CLAIMED EXEMPTION U/S 11 AND 12 OF THE ACT. THE ASSESSEE WAS ASKED TO ESTABLISH ITS ELIGIBILITY FOR THE CLAI M . THE ASSESSEE INTER - ALIA, SUBMITTED THAT TRUST IS OLD TRUST AND THE COPY OF CERTIFICATE ISSUED U/S 12A OF THE ACT IS NOT TRACEABLE FOR VERIFICATION . IT WAS FURTHER SUBMITTED THAT SINCE THE HARD COPY OF CERTIFICATE OF 12A IS NOT TRACEABLE, A SEPARATE AP PLICATION FOR REGISTRATION U/S 12A OF THE ACT WAS FILED. THE SUBMISSIONS OF ASSESSEE WERE NOT FOUND ACCEPTABLE TO THE ASSESSING OFFICER. THE ASSESSING 3 ITA NO.1403/PUN/2019 OFFICER WAS OF THE VIEW THAT THE ASSESSEE WAS NOT HAVING VALID COPY OF REGISTRATION U/S 12AA OF THE ACT AND THEREFORE, ASSESSEE WAS NOT ELIGIBLE TO CLAIM EXEMPTION U/S 11 AND 12 OF THE ACT. HE THEREFORE, DENIED THE CLAIM U/S 11 AND 12 OF THE ACT AND DETERMINED THE TOTAL INCOME AT RS.7,79,620/ - . 4. AGGRIEVED BY THE ORDER OF ASSESSING OFFICER, ASSESSEE CA RRIED THE MATTER BEFORE THE CIT(A), WHEREIN INTER - ALIA, IT WAS SUBMITTED THAT THE TRUST WAS REGISTERED LONG BACK AND THE APPLICATION FOR ORIGINAL REGISTRATION IS NOT TRACEABLE. IT WAS FURTHER STATED BEFORE THE CIT(A) THAT ONE OF THE TRUSTEES SHRI CHANDANLAL SARUPCHAND SHAH HAD STATED IN THE AFFIDAVIT THAT HE WAS TRUSTEE OF ANOTHER TRUST BY NAME SHRI GODI PARASHAWNATH TEMPLE TRUST AND BOTH THE TRUS TS WERE GRANTED REGISTRATION CERTIFICATE BY CIT ON THE SAME DAY . IT WAS ALSO SUBMITTED THAT THE DEPARTMENT DOES NOT POSSESS OLD RECORDS WHEREIN DETAILS OF REGISTRATION ARE MAINTAINED. IT WAS THEREFORE, SUBMITTED THAT THE ASSESSEE BE CONSIDERED TO BE A RE GISTERED TRUST AND BE GRANT ED EXEMPTION U/S 11 AND 12 OF THE ACT. IT WAS FURTHER SUBMITTED THAT AS THE ORIGINAL CERTIFICATE U/S 12AA WAS NOT TRACEABLE THE ASSESSEE HAD MADE A SEPARATE APPLICATION FOR REGISTRATION AND CIT(EXEMPTION) VIDE CERTIFICATE ISSUED U/S 12A OF THE ACT ON 30.09.2015 W.E.F. A.Y. 2015 - 16 HAD GRANTED CERTIFICATE. IT WAS SUBMITTED THAT SINCE THE ASSESSEE HAS BEEN GRANTED CERTIFICATE , THEREFORE IN VIEW OF THE PROVISO TO SECTION 12A(2) OF THE ACT THE BENEFIT U/S 11 AND 12 BE GRANTED . THE SUBMISSIONS OF ASSESSEE WERE NOT FOUND ACCEPTABLE TO THE CIT(A). THE CIT(A) IN THE ABSENCE OF ANY EVIDENCE BROUGHT IN BY THE ASSESSEE TO PROVE THAT HAVING RECEIVED REGISTRATION IN 1974, DENIED THE CLAIM OF EXEMPTION. WITH RESPECT TO ALTERNATE CONTENTION O F ASSESSEE OF ALLOWING THE CLAIM IN VIEW OF PROVISO TO SECTION 12A(2) OF THE ACT, CIT(A) CONCLUDED THAT PROVISO TO SECTION 4 ITA NO.1403/PUN/2019 12A(2) WAS INTRODUCED W.E.F A.Y. 2014 - 15 VIDE FINANCE ACT, 2014 AND THEREFORE DOES NOT COVER THE PERIOD UNDER CONSIDERATION. HE FURT HER OBSERVED THAT AS PER THE SAID PROVISO, IF THE REGISTRATION TO THE TRUST HAS BEEN GRANTED THEN BENEFIT OF SECTIONS 11 AND 12 OF THE ACT COULD ALSO BE EXTENDED TO THE PRIOR ASSESSMENT YEARS FOR WHICH ASSESSMENT IS PENDING BEFORE THE ASSESSING OFFICER. H E HELD THAT IN ASSESSEES CASE THE CIT (E) HAS GRANTED REGISTRATION W.E.F. A.Y. 2015 - 16 VIDE ORDER DATED 30.09.2015 AND THE ASSESSMENT PROCEEDINGS U/S 143(3) OF THE ACT WERE COMPLETED BY ASSESSING OFFICER ON 20.03.2015 MEANING THEREBY THAT NO ASSESSMENT PRO CEEDINGS FOR THE YEAR UNDER CONSIDERATION WERE PENDING BEFORE THE ASSESSING OFFICER AND THEREFORE THE SAID PROVISO TO SECTION 12A(2) WOULD NOT BE APPLICABLE. HE THUS, UPHELD THE ORDER OF ASSESSING OFFICER. 5 . AGGRIEVED BY THE ORDER OF CIT(A), THE ASSESSEE IS NOW IN APPEAL. 6 . BEFORE ME THE LD. AR REITERATED THE SUBMISSIONS MADE BEFORE THE ASSESSING OFFICER AND CIT(A). SHE FURTHER SUBMITTED THAT IN THE PAST THE CLAIM OF EXEMPTION U/S 11 AND 12 OF THE ACT WAS NEVER DENIED TO ASSESSEE AND FOR THE FIRST TIME THE BENEFIT WAS DENIED IN THE YEAR UNDER CONSIDERATION . AS A N ALTERNATE CONTENTION, SHE SUBMITTED THAT THE ASSESSEE BE GRANTED EXEMPTION IN VIEW OF PROVI SO TO SECTION 12A(2) OF THE ACT . SHE SUBMITTED THAT SINCE ASSESSEE HAD FILED APPEAL AGAINST THE ORDER OF ASSESSING OFFICER, THE PENDENCY OF APPEAL BEFORE CIT(A) BE CONSIDERED TO BE A CASE WHERE ASSESSMENT PROCEEDINGS ARE PENDING. I N SUPPORT OF AFORESAID CONTENTION , SHE PLACED RELIANCE ON THE DECISION OF PU NE TRIBUNAL SMC BENCH IN THE CASE OF SHRI KRISHNABAI GHAT TRUST VS. ITO (EXEMPTIONS) IN ITA NO.44/PUN/2019, FOR A.Y. 2014 - 15, ORDER DATED 03.05.2019. SHE ALSO PLACED ON RECORD THE COPY 5 ITA NO.1403/PUN/2019 OF AFORESAID ORDER. FROM THE AFORESAID ORDER SHE SUBMITTED THAT THE H ONBLE TRIBUNAL HAS HELD THAT AN ASSESSMENT PROCEEDINGS WHICH IS PENDING IN APPEAL BEFORE THE APPELLATE AUTHORITY SHOULD BE DEEMED TO BE ASSESSMENT PROCEEDINGS PENDING BEFORE THE ASSESSING OFFICER WITHIN THE MEANING OF THE TERM AS ENVISAGED UNDER THE PRO VISO. SHE THEREFORE, SUBMITTED THAT THE ASSESSEE BE ALLOWED THE BENEFIT OF EXEMPTION U/S 11 AND 12 OF THE ACT . 7 . THE LD. DR ON THE OTHER HAND SUPPORTED THE ORDERS OF ASSESSING OFFICER AND CIT(A). 8 . I HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. THE ISSUE IN THE PRESENT APPEAL IS WITH RESPECT TO DENIAL OF CLAIM OF EXEMPTION U/S 11 AND 12 OF THE ACT. IT IS AN UNDISPUTED FACT THAT ASSESSMENT U/S 143(3) OF THE ACT WAS FRAMED BY ASSESSING OFFICER ON 20.03.2015 WHEREBY THE CLAIM O F EXEMPTION U/S 11 AND 12 WAS DENIED BY THE ASSESSING OFFICER. AGAINST THE AFORESAID ORDER OF ASSESSING OFFICER, ASSESSEE CARRIED THE MATTER BEFORE THE CIT(A). IN THE INTERIM, THE ASSESSEE HAD APPLIED FOR FRESH REGISTRATION BEFORE THE CIT (E) AND CIT (E) V IDE ORDER DATED 19.03.2015 HAS GRANTED REGISTRATION W.E.F. A.Y. 2015 - 16. I FIND THAT AN IDENTICAL ISSUE AROSE IN THE CASE OF SHRI KRISHNABAI GHAT TRUST VS. ITO (EXEMPTIONS) (SUPRA), WHEREIN PUNE TRIBUNAL HAS HELD AS UNDER: - 6. A CLOSE SCRUTINY OF THE PRO VISION INDICATES THAT WHERE AN ASSESSEE HAS MADE AN APPLICATION FOR REGISTRATION AFTER THE DATE SPECIFIED IN THE SUB - SECTION (2), THE PROVISIONS OF SECTIONS 11 AND 12 OF THE ACT SHALL APPLY FROM THE ASSESSMENT YEAR IMMEDIATELY FOLLOWING THE FINANCIAL YEAR IN WHICH SUCH APPLICATION IS MADE. FIRST PROVISO TO THIS SECTION IS RELEVANT FOR OUR PURPOSE. THIS PROVISO STATES THAT WHERE THE REGISTRATION HAS BEEN GRANTED TO THE ASSESSEE U/S.12AA, THEN THE PROVISIONS OF SECTIONS 11 AND 12 SHALL APPLY TO ANY ASSESSMENT YEAR PRECEDING THE AFORESAID ASSESSMENT YEAR FOR WHICH ASSESSMENT PROCEEDINGS ARE PENDING BEFORE THE ASSESSING OFFICER AS ON THE DATE OF SUCH REGISTRATION AND THE OBJECTS AND ACTIVITIES OF SUCH TRUST REMAINED THE SAME FOR SUCH PRECEDING ASSESSMENT YEAR. CRUX OF THE PROVISION IS THAT IF REGISTRATION HAS BEEN GRANTED 6 ITA NO.1403/PUN/2019 SUBSEQUENTLY AND THE PROCEEDINGS FOR SOME EARLIER YEAR ARE PENDING BEFORE THE AO AS ON THE DATE OF GRANTING THE REGISTRATION, THEN THE BENEFIT OF SECTIONS 11 AND 12 SHOULD BE GRANTED TO SUCH E ARLIER YEARS AS WELL PROVIDED THE OBJECTS AND ACTIVITIES OF THE TRUST REMAINED THE SAME. IT IS RELEVANT TO NOTE THAT THE REGISTRATION IN THE EXTANT CASE WAS GRANTED BY THE CIT (EXEMPTIONS), PUNE ON 28 - 09 - 2017. THE ASSESSMENT IN THIS CASE WAS COMPLETED U/S. 143(3) OF THE ACT ON 15 - 12 - 2016. THEREAFTER, THE ASSESSEE PREFERRED FIRST APPEAL BEFORE THE LD. CIT(A) AGAINST THE SAID ASSESSMENT ORDER, WHICH CAME TO BE DECIDED BY MEANS OF IMPUGNED ORDER DATED 01 - 10 - 2018. THIS MANIFESTS THAT AS ON THE DATE OF GRANT OF R EGISTRATION BY THE LD. CIT (EXEMPTIONS), THOUGH THE ASSESSMENT ORDER HAD ALREADY BEEN PASSED BUT THE APPEAL OF THE ASSESSEE WAS PENDING BEFORE THE LD. CIT(A). UNDER SUCH CIRCUMSTANCES, A QUESTION ARISES AS TO WHETHER OR NOT THE BENEFIT OF FIRST PROVISO CAN BE EXTENDED TO THE ASSESSEE? 7.. 8. AT THIS JUNCTURE, IT WOULD BE PERTINENT TO NOTE THAT THE MAIN OBJECT OF PROVISO TO SECTION 12A(2) IS TO LIBERALLY GRANT THE BENEFIT OF REGISTRATION WHEN THE TRUST IS OTHERWISE ENGAGED IN GENUINE CHARITABLE ACTIVITIES AND THE REGISTRATION HAS BEEN ACTUALLY GRANTED ALBEIT AFTER THE CLOSE OF THE RELEVANT PERIOD. PURPOSE OF THIS PROVISO IS TO BENEFIT ASSESSEES IN THE GIVEN CIRCUMSTANCES SUBJECT TO THE FULFILLMENT OF OTHER CONDITIONS. IN SUCH A SITUATION, THE OBJECT OF THE PROVISO IS FURTHERED IF ITS BENEFIT IS MADE AVAILABLE TO THE EXTENDED ASSESSMENT PROCEEDINGS, BEING, THE PROCEEDINGS BEFORE CIT(A). AS AT THE TIME OF GRANTING REGISTRATION BY THE LD. CIT (EXEMPTIONS) TO THE ASSESSEE, THE APPEAL OF THE ASSESSEE WAS PENDING BEFORE THE LD. CIT(A), IN MY CONSIDERED OPINION, THE BENEFIT OF FIRST PROVISO TO SECTION 12A(2) OUGHT TO HAVE BEEN GRANTED. MY VIEW IS FORTIFIED BY THE JUDGMENT OF HONBLE RAJASTHAN HIGH COURT IN CIT (EXEMPTIONS) VS. SHREE SHYAM MANDIR COMMITTEE (2018) 40 0 ITR 466 (RAJ.) IN WHICH IT HAS BEEN HELD THAT AN ASSESSMENT PROCEEDINGS WHICH IS PENDING IN APPEAL BEFORE THE APPELLATE AUTHORITY SHOULD BE DEEMED TO BE ASSESSMENT PROCEEDINGS PENDING BEFORE THE AO. WITHIN THE MEANING OF THE TERM AS ENVISAGED UNDER TH E PROVISO. IT FOLLOWS THERE FROM THAT THE ASSESSEE WHICH OBTAINED REGISTRATION U/S.12AA OF THE ACT DURING THE PENDING OF APPEAL WAS ENTITLED FOR EXEMPTION CLAIMED U/S.11 OF THE ACT. THE ADDITIONAL GROUND THUS RAISED IS ALLOWED BY HOLDING THAT THE ASSESSEE WOULD BE ENTITLED TO EXEMPTION U/SS. 11 AND 12 OF THE ACT FOR THE YEAR UNDER CONSIDERATION ON THE RAISON DETRE THAT THE REGISTRATION WAS, IN FACT, GRANTED TO THE ASSESSEE U/S.12AA DURING THE PENDENCY OF PROCEEDINGS BEFORE THE LD. CIT(A). 9. IN THE LIGHT OF MY ABOVE CONCLUSION ON THE ADDITIONAL GROUND, THE IMPUGNED ORDER IS SET - ASIDE AND THE MATTER IS RESTORED TO THE FILE OF AO FOR FRAMING A DE NOVO ASSESSMENT AS PER LAW AFTER ALLOWING A REASONABLE OPPORTUNITY OF HEARING TO THE ASSESSEE. NEEDLESS TO SAY, THE ASSESSEE IN SUCH ASSESSMENT PROCEEDINGS WOULD BE CONSIDERED TO HAVE BEEN GRANTED REGISTRATION AND THE PROVISIONS OF SECTIONS 11 AND 12 SHALL APPLY PRO TANTO. 9 . BEFORE ME , THE REVENUE HAS NOT POINTED OUT AS TO HOW THE DECISION IN THE CASE OF SHRI KRI SHNABAI GHAT TRUST VS. ITO (EXEMPTIONS) (SUPRA) WOULD NOT BE APPLICABLE TO THE PRESENT CASE. I THEREFORE, FOLLOWING THE RATIO OF DECISION IN THE CASE OF SHRI KRISHNABAI GHAT TRUST VS. ITO (EXEMPTIONS) 7 ITA NO.1403/PUN/2019 (SUPRA), HOLD THAT THE ASSESSEE IS ELIGIBLE FOR EXEMPT ION U/S 11 AND 12 OF THE ACT. IN VIEW OF THE AFORESAID, THE GROUNDS RAISED BY THE ASSESSEE ARE ALLOWED. 10 . IN THE RESULT, THE APPEAL OF ASSESSEE IS ALLOWED. ORDER PRONOUNCED ON 21 ST DAY OF JANUARY , 20 20 . / - SD/ - ( ANIL CHATURVEDI ) / ACCOUNTANT MEMBER PUNE ; DATED : 21 ST JANUARY , 20 20 . GCVSR / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT. 2. / THE RESPONDENT. 3. ( ) / THE CIT(A), PUNE - 10 4. / THE CIT (EXEMPTION) , PUNE 5. , , / DR, ITAT, SMC PUNE . 6. / GUARD FILE. / BY ORDER // TRUE COPY // / SR. PRIVATE SECRETARY , / ITAT, PUNE .