Punjab State E-Governance Society, Chandigarh V. CIT-II, Chandigarh

ITA 198/CHANDI/2014

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 86220 (ITAT-CHANDIGARH)
• Duration Of Justice: 1 year(s) 1 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-03-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 30-03-2015
• Assessment Year: misc
• Appeal Filed On: 28-02-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: JYOTI KUMARI
• Assessee Lawyers: UMA KANT MEHTA
• Keywords: Opportunity of being heard
• Section: 12AA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCH B CHANDIGARH BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI T.R.SOOD, ACCOUNTANT MEMBER ITA NO. 198/CHD/2014 (ORDER U/S 12AA ) PUNJAB STATE E-GOVERNANCE SOCIETY, VS THE CIT-II, SCO-193-195, SECTOR 34-A, CHANDIGARH. CHANDIGARH. PAN: AAATP9562E (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI UMA KANT MEHTA RESPONDENT BY : SMT. JYOTI KUMARI DATE OF HEARING : 30.03.2015 DATE OF PRONOUNCEMENT : 31.03.2015 O R D E R PER BHAVNESH SAINI,JM THIS APPEAL BY ASSESSEE IS DIRECTED AGAINST THE OR DER OF LD. LD. COMMISSIONER OF INCOME TAX-II CHANDIGARH DATED 30.12.2013 REJECTING THE APPLICATION UNDER SECTION 12AA OF THE INCOME TAX ACT. 2. BRIEFLY THE FACTS OF THE CASE ARE THAT THE ASSES SEE SOCIETY FILED ITS APPLICATION IN PRESCRIBED FORM FOR GRANT OF REGISTRATION UNDER SECTION 12AA OF THE ACT. THE ASSESSING OFFIC ER WAS DIRECTED TO SEND ENQUIRY REPORT BEFORE LD. COMMISSI ONER OF INCOME TAX, HOWEVER ASSESSING OFFICER REPORTED THAT ASSESSEE HAS NOT FURNISHED ANY DOCUMENT OR REPLY. THEREFORE , DUE TO NON-COOPERATIVE ATTITUDE OF THE ASSESSEE, THE REGIS TRATION 2 APPLICATION UNDER SECTION 12AA MAY NOT BE CONSIDERE D FAVOURABLY. THE LD. COMMISSIONER OF INCOME TAX FIX ED THE HEARING OF THE APPLICATION AND ASSESSEE WAS DIRECTE D TO FURNISH COMPLETE SUPPORTING DOCUMENTS AND PRODUCE THE BOOKS OF ACCOUNT, BILLS AND VOUCHERS ETC. THE LD. COMMISSIO NER OF INCOME TAX NOTED THAT NECESSARY DOCUMENTS HAVE BEEN FURNISHED BEFORE HIM. THE LD. COMMISSIONER OF INCO ME TAX, ON PERUSAL OF MEMORANDUM OF ASSOCIATION NOTED THAT ASS ESSEE IS NOT DOING CHARITABLE ACTIVITY AND THE INCOME AND EX PENDITURE REVEALED THAT THE RECEIPTS OF THE ASSESSEE SOCIETY ARE FROM GOVERNMENT DEPARTMENT, SALE OF TENDER FORMS, FACILI TATION CHARGES, MISCELLANEOUS INCOME AND INTEREST INCOME E TC. IT WAS, THEREFORE, FOUND THAT ASSESSEE SOCIETY IS WORKING A S A BACKEND- OFFICE TO THE PUNJAB GOVERNMENT AND IS NOT DOING AN Y CHARITABLE ACTIVITY. THEREFORE, APPLICATION OF ASSESSEE WAS R EJECTED. 3. WE HAVE HEARD LD. REPRESENTATIVES OF BOTH THE PA RTIES AND PERUSED THE MATERIAL ON RECORD. THE LD. COUNSEL FO R THE ASSESSEE REFERRED TO THE INCOME AND EXPENDITURE ACC OUNT OF VARIOUS YEARS FROM THE PAPER BOOK AND STATED THAT T HERE IS A DEFICIT OVER THE RECEIPTS IN ALL THE YEARS AND ASSE SSEE IS NOT DOING ANY COMMERCIAL ACTIVITY AND THAT COMPLETE DET AILS WERE FILED. THEREFORE, APPLICATION OF ASSESSEE SHOULD H AVE BEEN REJECTED BY THE LD. COMMISSIONER OF INCOME TAX. 4. ON THE OTHER HAND, LD. DR RELIED UPON IMPUGNED O RDER AND SUBMITTED THAT IN THE SIMILAR CIRCUMSTANCES, AMRITS AR BENCH HAS REJECTED THE REGISTRATION APPLICATION. 3 5. ON CONSIDERATION OF THE RIVAL SUBMISSIONS, WE AR E OF THE VIEW THE MATTER REQUIRED RE-CONSIDERATION AT THE LE VEL OF THE LD. COMMISSIONER OF INCOME TAX-II CHANDIGARH. THE INCO ME & EXPENDITURE ACCOUNT FILED FOR VARIOUS YEARS IN THE PAPER BOOK CLEARLY SHOW THAT THERE WAS AN EXCESS OF EXPENDITUR E OVER INCOME. THEREFORE, IT MAY NOT BE A CASE OF EARNING PROFIT AS IS SUGGESTED THROUGH THE IMPUGNED ORDER. IT IS ADMITT ED FACT THAT THE RECEIPTS OF THE ASSESSEE SOCIETY ARE FROM GOVER NMENT DEPARTMENTS, SALE OF TENDER FORMS AND FACILITATION CHARGES. THE ASSESSEE IS, THEREFORE, WORKING FOR THE GOVERNMENT OF PUNJAB AND AS SUCH MAY NOT BE DOING THE COMMERCIAL ACTIVIT Y IN ORDER TO VIOLATE THE PROVISIONS OF SECTION 2(15) OF THE A CT. THE LD. COMMISSIONER OF INCOME TAX, AT THE END OF THE IMPUG NED ORDER NOTED THAT SINCE THE ASSESSEE COULD NOT FURNISH THE EXPLANATION, THEREFORE, APPLICATION OF THE ASSESSEE WAS REJECTED. THE LD. COUNSEL FOR THE ASSESSEE, HOWEVER, SUBMITTE D THAT COMPLETE DETAILS WERE FILED, THEREFORE THERE WAS NO JUSTIFICATION TO REJECT THE APPLICATION FOR REGISTRATION. 6. IN VIEW OF THE ABOVE, WE ARE OF THE VIEW THE MAT TER REQUIRES RE-CONSIDERATION AT THE LEVEL OF THE LD. C IT(APPEALS). WE, ACCORDINGLY, SET ASIDE THE IMPUGNED ORDER AND R ESTORE THE MATTER AND ISSUE TO THE FILE OF LD. COMMISSIONER OF INCOME TAX- II CHANDIGARH WITH DIRECTION TO RE-DECIDE REGISTRAT ION APPLICATION IN ACCORDANCE WITH LAW AND LD. COMMISSI ONER OF INCOME TAX SHALL PASS DETAILED SPEAKING ORDER BY GI VING REASONABLE SUFFICIENT OPPORTUNITY OF BEING HEARD TO THE ASSESSEE 4 AND THE APPLICATION BE DECIDED PREFERABLY WITHIN A PERIOD OF TWO MONTHS FROM THE RECEIPT OF THIS ORDER. 7. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 31 ST MARCH,2015. SD/- SD/- (T.R.SOOD) (BHAVNESH SAINI) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 31 ST MARCH,2015. POONAM COPY TO: THE APPELLANT, THE RESPONDENT, THE CIT(A), THE CIT, DR ASSISTANT REGISTRAR, ITAT CHANDIGARH