M/s Chouhan Education Society, Bhopal V. The ACIT 1(1), Bhopal

ITA 193/Ind/2009

AI Insights

The case involves M/s. Chouhan Education Society, which appealed against the order of the Commissioner of Income Tax (Appeals) denying them exemption under section 10(23C)(iiiad) and not recognizing their registration under section 12A for the assessment year 2000-01. The society, engaged in educational activities, argued that they met the conditions for exemption as their gross receipts were below Rs. 1 crore and they existed solely for educational purposes. Initially, their registration under section 12A was granted effective from 01.04.2003, but after several rounds of litigation, the Tribunal recognized the registration from 01.04.1999, thus granting them the benefits of sections 11 and 12 retrospectively.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 130713 (ITAT-INDORE)
• Duration Of Justice: 13 year(s) 10 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-03-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 20-09-2022
• Assessment Year: 2000-2001
• Appeal Filed On: 14-04-2009
• Other Referred Cases: MAA Bagula Mukhi Shakti Peeth Charitable Trust Vs. CIT
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 12; 11; 12A

Judgement Text

Page 1 of 4 आयकर अपील य अ धकरण, इंदौर यायपीठ, इंदौर IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI VIJAY PAL RAO, JUDICIAL MEMBER AND SHRI B.M. BIYANI, ACCOUNTANT MEMBER ITA No. 193/Ind/2009 (Assessment Year:2000-01) M/s. Chouhan Education Society E-8, Trilanga, Shahpura, Bhopal Vs. ACIT 1(1) Bhopal (Appellant / Assessee) (Respondent/ Revenue) PAN: AAATC 551 Q Assessee by Ms. Nisha Lahoti & Shri Vijay Bansal, ARs Revenue by Shri Ashish Porwal, Sr. DR Date of He aring 27.02.2023 Date of Pronouncement 02.03.2023 O R D E R Per Vijay Pal Rao, JM: This appeal by the assessee is directed against the order dated 26.11.08 of Ld. Commissioner of Income Tax (Appeals) (in short Ld. CIT(A) for Assessment Year 2000-01. The assessee has raised following grounds of appeal: “1.In view of the facts and law, the ld. CIT(Appals) was not justified in denying the exemption u/s 10(23)(C) (iiiad) to the assessee society for A.Y. 2000-01. 2. In view of the facts and law, the Ld. CIT(A) has not considered the assessee society to be registered as per the provisions of u/s 12AA(2) of the Income Tax Act, 1961. ITA No.193/Ind/2009 Chouhan Education Society Page 2 of 4 Page 2 of 4 3.That on the basis of above facts, the assesee creeps to leave, to arch, to argue to amend any of the grounds of appeal on or before the dated of hearing.” 2. The assessee is a society, registered under M.P. Registration Act, 1973. The assessee is carrying out the activity of imparting education and claims its objects and activities are charitable. The assessee society applied for registration u/s 12A on 31.03.2000. Assessee requested the registration w.e.f. 1999-2000 however the registration was granted u/s 12A w.e.f 01.04.2003. The assessee filed its return of income for the year under consideration declaring the income after claiming exemption u/s 10(23C)(iiiad). Thereafter, the Ld. AO opened assessment vide notice u/s 148 dated 08.03.2006 and framed assessment by taking the excess of income over expenditure as well as grant in aid receipt by the assessee, as total income of the assessee at Rs. 36,05,590/-. The assessee challenged the action of the Ld. AO before the Ld. CIT(A) and contending that the assessee satisfied the conditions as provided u/s 10(23)(iiiad) of the Act as the assessee is solely exists for education and gross receipt of the assessee is less than Rs. 1 crore. Ld. CIT(A) did not accept this contention of the assessee and confirm the action of the Ld. AO, so far as denial of the exemption u/s 10(23C(iiiad) of the Act. Since the assessee was not granted registration u/s 12A for year under consideration but it was granted w.e.f. 01.04.2003 the benefit of section 11 & 12 of the Act was also denied to the assessee. 3. Before the Tribunal Ld. AR of the assessee has submitted that the registration u/s 12A has been granted by this Tribunal vide order dated 30.06.2022, therefore, the assessment year under consideration is covered by the registration granted u/s 12A of the Income Tax Act and hence the assessee is eligible for exemption u/s 11 & 12 of the Income Tax Act. 4. On the other hand, Ld. DR has not disputed the fact that the A.Y. 2000-01 is now covered under the registration granted u/s 12A of the ITA No.193/Ind/2009 Chouhan Education Society Page 3 of 4 Page 3 of 4 Income Tax Act and therefore the assessee is eligible for exemption u/s 11 & 12 of the Act. 5. We have considered the rival submissions as well as relevant material on record. The assessee was denied the benefit of exemption u/s 10(23C(iiiad) of the Act as the Ld. AO was of the view that the assessee does fulfill the condition as prescribed u/s 10(23C(iiiad), so for as the assessee exists solely for education purpose and not for the purpose of profit. Initially, the registration was granted to the assessee w.e.f. 01.04.2003, therefore the income for the year under consideration was not eligible for the exemption u/s 11 & 12 of the Act. However, the said order of Ld. CIT(Exemption) was challenged by the assessee before this tribunal and this Tribunal vide order dated 15.10.2008 in ITANo.100 of 2008, set aside the order of the Ld. CIT(E) dated 29.02.2008 and restored the matter to the file of the Ld. CIT(E) for deciding same de novo for providing adequate opportunity of hearing to the assessee. Ld. CIT(E) vide order dated 11.08.2017 again granted registration w.e.f. 01.04.2003 which was challenged by assessee in second round of litigation and vide order dated 30.06.2022, this Tribunal in ITANo.633/Ind/2017 has decided this issue in para no.7 as under: “7. We have considered the rival arguments of both sides, perused the material held on record and also examined the direction given by this Bench in the first round of litigation. After a careful consideration, we observe that the assessee filed application in Form No. 10A on 31.03.2000for grant of registration and on the basis of this application, the procedure of registration was set in motion. We observe that the Ld. CIT issued certain notices to the assessee on the basis of the application dated 31.03.2000 and the assessee too complied with those notices. However, realizing that no decision was coming from Ld. CIT and more particularly being aware of the fact that there was a change in jurisdiction from ITO, Ward-2 to Circle- 1(1), the assessee re-filed a copy of the original application along with documentary evidences on 07.01.2004. Ld. AR has pointed out that the filing on 07.01.2004 is a mere re-filing of documents to facilitate the registration process and there was no fresh application. Thus, we observe that the application was in fact filed on 31.03.2000 and not on 07.01.2004. We also find that it is not a case of revenue that the application dated 31.03.2000 was rejected by Ld. CIT as there is no such material produced before us. In such circumstances, therefore, ITA No.193/Ind/2009 Chouhan Education Society Page 4 of 4 Page 4 of 4 there is no justification to grant registration from 01.04.2003. In fact, the Ld. CIT ought to have granted registration from 01.04.1999. We also observe that the decision of this Bench in MAA Bagula Mukhi Shakti Peeth Charitable Trust Vs. CIT (supra) also supports assessee’s claim. Therefore, we are persuaded to direct the Ld. CIT(E) to rectify his order and grant registration from 01.04.1999. 6. This Tribunal has specifically held that the registration ought to have been granted from 01.04.1999 and directed the Ld. CIT(E) rectify the order and grant registration w.e.f. 01.04.1999. Accordingly, in the facts and circumstances of the case and in pursuant to the registration granted to the assessee u/s 12A w.e.f. 01.04.1999, the assessee is eligible for exemption u/s 11 & 12 of the Income Tax Act for year under consideration and consequently, the addition made by the assessee is defected. Since, the benefit of exemption u/s 11 & 12 of the I.T. Act is granted to the assessee. Therefore, the other grounds raised for exemption u/s 10(23C)(iiiad) becomes academic in nature and not pressed by the assessee for this assessment year. We accordingly dismissed. 7. In the result, appeal of assessee is allowed for statistical purposes. Order pronounced in the open court on 02.03.2023. Sd/- Sd/- (B.M. BIYANI) (VIJAY PAL RAO) Accountant Member Judicial Member Indore, 02.03.2023 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