RESTORE ECONOMIC SOCIAL CONDITION thru UNITED EFFORT (RESCUE), Secunderabad V. Director of Income tax, (Exemptions), Hyderabad

ITA 1553/HYD/2012

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 2789 (ITAT-HYDERABAD)
• Duration Of Justice: 6 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-04-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2011-2012
• Appeal Filed On: 09-10-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: KOMAL KISHORE
• Assessee Lawyers: T CHAITNAYA KUMAR
• Keywords: Opportunity of being heard; Corroborative evidences
• Section: 12AA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH B', HYDERABAD BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SHRI SAKTIJIT DEY, JUDICIAL MEMBER ITA NO. 1553/HYD/12 ASST. YEAR: 2011-12 RESTORE ECONOMIC SOCIAL CONDITION THRU UNITED EFFORT (RESCUE), SECUNDERABAD (PAN AAJTS 1402P) V/S. DIRECTOR OF INCOME-TAX (EXEMPTION), HYDERABAD. (APPELLANT) (RESPONDENT) APPELLANT BY : T. CHAITNAYA KUMAR RESPONDENT BY : SMT. KOMAL KISHORE DATE OF HEARING 25-04-2013 DATE OF PRONOUNCEMENT 25-04-2013. O R D E R PER SAKTIJIT DEY, JUDICIAL MEMBER: THIS APPEAL FILED BY THE APPELLANT IS DIRECTED AGAI NST THE ORDER OF DIT(E), DATED 26/06/2012 HYDERABAD PASSED IN APPEAL NO. F.NO. DIT(E)/HYD/45(12)80G/2012-13. 2. THE ONLY ISSUE RAISED IN THE GROUNDS OF APPEAL I S WITH REGARD TO REJECTION OF APPELLANTS APPLICATION FOR GRANT O F REGISTRATION U/S 12AA AND UNDER SECTION 80G(5) OF THE IT ACT. 3. THERE IS A DELAY OF 23 DAYS IN FILING THIS APPEA L BEFORE US. THE APPELLANT HAS SUBMITTED AN AFFIDAVIT EXPLAINING THE CAUSE OF DELAY. AFTER CONSIDERING THE SUBMISSIONS OF THE LEA RNED AR AND PERUSING THE REASONS SHOWN IN THE AFFIDAVIT FOR THE CAUSE OF DELAY 2 ITA NO. 1553/H/12 RESTORE ECONOMIC SOCIAL CONDITION THRU UNITED EFFOR T (RESCUE) IN FILING THE APPEAL, WE ARE INCLINED TO CONDONE TH E SAME AND ADMIT THE APPEAL FOR HEARING ON MERITS. 4. BRIEFLY THE FACTS ARE THE APPELLANT A SOCIETY SU BMITTED AN APPLICATION IN FORM NO. 10A BEFORE THE DIT(E) SEEKI NG REGISTRATION U/S 12AA OF THE ACT AND ALSO SUBMITTED AN APPLICATION IN FORM NO. 10G FOR GRANT OF APPROVAL U/S 80G(5) OF THE ACT, ON 15/12/2011. THE DIT(E) CALLED FOR CERTAIN INFORMATI ON FROM THE ASSESSEE VIDE A QUESTIONNAIRE ISSUED ON 23/03/2012 AND ALSO ASKED THE ASSESSEE TO PRODUCE BOOKS OF ACCOUNT, BIL LS AND VOUCHERS FOR VERIFICATION. IN RESPONSE TO THE QUERY MADE BY THE DIT(E) THE ASSESSEE APPEARED FROM TIME TO TIME AND PRODUCED THE INFORMATION CALLED FOR. THE DIT(E) AFTER EXAMINING THE RECEIPT & PAYMENT ACCOUNT FOR THE FY 2011-12 FOUND THAT A SUM OF RS. 43,064/- WAS RECEIVED WHICH INCLUDES A SUM OF RS. 4 3,000/- AS FUNDS FROM TRUSTEES AND BARRING A SUM OF RS. 5,324/ - TOWARDS CLOSING CASH AND BANK BALANCE, THE BALANCE AMOUNT W AS FULLY SPENT FOR DIFFERENT PURPOSES. HOWEVER, IN THE BALAN CE SHEET AGAIN A SUM OF RS. 43,000/- IS SHOWN AS CAPITAL FUND UNDE R THE HEAD LIABILITIES. THE DIT(E) WAS OF THE VIEW THAT WHE N OUT OF THE TOTAL RECEIPT OF RS. 43,064/- AN AMOUNT OF RS. 37,440/- H AS BEEN SPENT, TREATING THE SAME AS INCOME DURING THE YEAR IT COULD NOT HAVE BEEN POSSIBLE TO AGAIN CLAIM SUCH AMOUNT AS CA PITAL FUND IN THE BALANCE SHEET. THE DIT(E) FURTHER NOTED THAT TH ERE WAS NO DISCLOSURE OF CORPUS FUND/TRUST FUND OF RS. 5,000/- SEPARATELY IN THE BALANCE SHEET. HE FURTHER NOTED THAT SO FAR AS INCURRING OF EXPENDITURE IS CONCERNED EXCEPT BILL TOWARDS PURCHA SE OF CLOTHES FOR AN AMOUNT OF RS. 9700/- AND REFRESHMENTS OF RS. 2140/-, OTHER EXPENDITURE IS MADE THROUGH SELF-MADE VOUCHER S, WHICH ARE NOT VERIFIABLE. FROM THE AFORESAID OBSERVATION, THE DIT(E), CAME TO A CONCLUSION THAT IN ABSENCE OF PROPER MAINTENAN CE OF BOOKS OF ACCOUNT REGISTRATION U/S 12AA OF THE ACT, CANNOT BE GRANTED. 3 ITA NO. 1553/H/12 RESTORE ECONOMIC SOCIAL CONDITION THRU UNITED EFFOR T (RESCUE) ACCORDINGLY, HE REJECTED THE APPLICATION FOR REGIST RATION U/S 12AA OF THE ACT AND CONSEQUENTLY, THE APPLICATION SEEKIN G APPROVAL U/S 80G(5) WAS ALSO REJECTED. 5. WE HAVE HEARD THE SUBMISSIONS OF THE PARTIES AND PERUSED THE RECORD. THE SOLE CONTENTION OF THE LEARNED AR B EFORE US IS, THE DIT(E) WITHOUT GIVING A PROPER OPPORTUNITY TO THE A PPELLANT TO EXPLAIN THE ISSUES ON WHICH HE FORMED AN OPINION TH AT BOOKS OF ACCOUNT ARE NOT PROPERLY MAINTAINED SHOULD NOT HAVE REJECTED THE APPLICATION FOR GRANT OF REGISTRATION U/S 12AA OF T HE ACT. IT IS APPARENT FROM THE ORDER PASSED BY THE DIT(E) THAT H E ENTERTAINED CERTAIN DOUBTS WITH REGARD TO MAINTENANCE OF THE AC COUNTS. HE ALSO ENTERTAINED CERTAIN DOUBTS WITH REGARD TO THE GENUINENESS OF THE EXPENDITURE INCURRED THROUGH SELF-MADE VOUCHERS . HOWEVER, BEFORE REJECTING THE ASSESSEES APPLICATION, THE DI T(E) SHOULD HAVE AFFORDED A REASONABLE OPPORTUNITY TO THE APPEL LANT TO EXPLAIN THE DOUBTS WHICH HE MIGHT BE CARRYING IN HIS MIND A ND ALSO TO SUBSTANTIATE THE EXPENDITURE CLAIMED BY FURNISHING ADEQUATE EVIDENCE. IN THE AFORESAID VIEW OF THE MATTER, WE ARE INCLINED TO SET ASIDE THE ORDER PASSED BY THE DIT(E) REJECTING THE APPELLANTS APPLICATION FOR GRANT OF REGISTRATION U/S 12AA OF T HE ACT AND REMIT THE MATTER BACK TO HIS FILE FOR CONSIDERATION OF TH E ISSUE AFRESH AFTER EXAMINING THE MATERIALS AND EVIDENCES AVAILAB LE ON RECORD AND WHICH MAY BE PRODUCED BY THE APPELLANT. THE DIT (E) SHOULD AFFORD A REASONABLE OPPORTUNITY OF BEING HEARD TO T HE ASSESSEE IN THE MATTER BY ALLOWING HIM TO EXPLAIN THE ENTRIES I N THE BOOKS OF ACCOUNT WITH SUPPORTING EVIDENCE. THE ISSUE OF GRAN T OF APPROVAL U/S 80G(5) OF THE ACT, BEING CONSEQUENTIAL IN NATUR E IS ALSO REMITTED TO THE FILE OF THE DIT(E) FOR FRESH CONSID ERATION. 4 ITA NO. 1553/H/12 RESTORE ECONOMIC SOCIAL CONDITION THRU UNITED EFFOR T (RESCUE) 6. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE COURT ON 25 TH APRIL, 2013. SD/- SD/- (CHANDRA POOJARI) (SAKTIJIT DEY) ACCOUNTANT MEMBER JUDICIAL MEMBER HYDERABAD, DT/- 25 TH APRIL, 2013. KV COPY FORWARDED TO: 1. RESTORE ECONOMIC SOCIAL CONDITION THRU UNITED EFFOR T (RESCUE), H.NO. 12-8-206/3, METTUGUDA, SECUNDERABAD 500 017. 2. 3. DIT(E), , HYDERABAD ADIT(E), HYDERABAD. 4. DEPARTMENTAL REPRESENTATIVE, ITAT, HYDERABAD.