Sri Shirdi Sai Baba Satsang Seva Charitable Trust, Bhilai V. Commissioner of Income tax(Exemption, Bhopal

ITA 201/RPR/2019

• Counselvise Citation: [2022] 104 COUNSELVISE.COM (IT) 0596 (ITAT-RAIPUR)
• Duration Of Justice: 3 year(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-10-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 03-08-2022
• Assessment Year: 2018-2019
• Appeal Filed On: 13-10-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Depreciation; Charitable institution; Opportunity of being heard; Benefit of exemption
• Section: 11; 80G; 12AA

Judgement Text

आयकर अऩीऱीय अधधकरण, रायऩ ु र न्यायऩीठ, रायऩ ु र IN THE INCOME TAX APPELLATE TRIBUNAL RAIPUR BENCH, RAIPUR श्री रविश स ू द, न्याययक सदस्य एवं श्री अरुण खोड़वऩया, ऱेखा सदस्य के समक्ष । BEFORE SHRI RAVISH SOOD, JM & SHRI ARUN KHODPIA, AM आयकर अऩीऱ सं./ITA No.201/RPR/2019 (ननधाारण वषा / Assessment Year :NA) Sri Shirdi Sai Baba Satsang Seva Charitable Trust, Plot No.98, Pragati Nagar, Risali, Bhilai, Dist : Durgq Vs CIT(Exemption), Bhopal PAN No. : AAITS 4066 J (अऩीऱाथी /Appellant) .. (प्रत्यथी / Respondent) ननधााररती की ओर से /Assessee by : Shri R.B.Doshi, CA राजस्व की ओर से /Revenue by : Shri P.KMishra, CIT-DR स ु निाई की तारीख / Date of Hearing : 04/08/2022 घोषणा की तारीख/Date of Pronouncement : 17/10/2022 आदेश / O R D E R Per Arun Khodpia, AM : This appeal is filed by the assessee against the order passed by the CIT(E), Bhopal, dated 30.09.2019. 2. The sole ground raised by the assessee in this appeal is against the action of the CIT(E) in rejecting the application of the assessee filed for exemption u/s.80G of the Act. 3. Brief facts of the case are that the assessee trust filed an application seeking approval u/s.80G of the Act in form No.10G on 08.03.2019. The CIT(E) rejected the application of the assessee holding that the genuineness of the activities of the assessee could not verified. 4. Against the rejection of application of the assessee for approval u/s.80G of the Act by the CIT(E), the assessee is now in appeal before the Tribunal. ITA No.201/RPR/2019 2 5. Ld. AR before us submitted that the assessee has been granted registration u/s.12AA of the w.e.f. 21.02.2019 by accepting the genuineness of its objects and activities, however, rejecting the application for approval u/s.80G of the Act is not justified. Therefore, the ld. AR submitted that considering the objects and activities of the society, the assessee society is entitled for exemption u/s.80G of the Act. 6. On other hand, ld. Sr. DR relied on the order of ld. CIT(E). 7. We have heard submissions of the parties and perused the relevant documents placed on record. At the outset, we found that this issue has already been decided by the Hon’ble Punjab & Haryana High Court in the case of CIT Vs. Rajmala Educational Society, in IT Appeal No.820 of 2010, order dated 12.10.2011, wherein the Hon’ble High Court has held that once the exemption had been granted u/s.12AA and the same was continuing, the CIT was not justified in denying the approval u/s.80G of the Act. The relevant observations of the Hon’ble High Court are as under :- Charitable trust--Recognition under section 80G(c)(5)Surplus in hands of assessee society--In the present case, once the Tribunal had found that after depreciation and deducting the capital expenditure out of gross receipts, there was no surplus in the hands of the society, therefore, there was no violation of section 11 and there was no requirement to furnish intimation in Form 10 and once exemption had been granted under section 12AA on 29-8- 2002 and the same was continuing the CIT was not justified in denying the approval under section 80G. 8. The coordinate Bench of the Tribunal in the case of Dignity Education Society, in ITA No.31/RPR/2019, order dated 09.06.2022, wherein the Tribunal has held as under :- ITA No.201/RPR/2019 3 13. We have heard both the parties, perused materials available on record. The order of the Co-ordinate Bench and arguments of ld AR of the assessee, we hold that the assessee is eligible for approval of 80G of the Act since their 12AA registration is granted and continue. Even the assessment proceedings for A.Y.2016-2017 completed without any adverse observation on the issue and the activities of the trust are in accordance with the condition prescribed. Therefore, following the decision of Co-ordinate Bench. We set aside the order of ld. CIT(E) and direct ld. CIT(E) to grant an approval to the assessee u/s.80G of the Act. Thus, the grounds of appeal raised by the assessee is allowed. 9. Further, this Bench of this Bench of the Tribunal in the case of Sindhi Youth Association, in ITA No.29/RPR/2019, order dated 29.07.2022, has held the issue in favour of assessee after holding as under :- 11. Undisputedly, the assessee is continuing with the registration u/s.12A of the Act which also supports the claim of the assessee. In case of any violation finds by the CIT(E), the same would be subject to the withdrawal of the registration already granted u/s.12A of the Act. Moreover, the department is also satisfied with the genuineness of the activities of the assessee while framing the assessment u/s.143(3) of the Act for the assessment year 2016-17. Considering the overall factual aspects of the matter and the consistent judicial opinion in this regard, we are of the view that the CIT(E) is not justified in rejecting the application of the assessee-society for the benefit of exemption u/s 80G(5) of the Act. Thus, we allow the grounds of appeal of the assessee and direct the CIT(E) to grant exemption sought by the assessee-society u/s.80G of the Act. We order accordingly. 10. In view of the above judicial precedence and the facts and circumstances of the case, we hold that the CIT(E) is not justified in rejecting the application of the assessee. However, on perusal of the order u/s 80G(5)(vi), it is observed that opportunity of being heared was granted to assessee by notice dated 09/08/2019 fixing the date of hearing on 26/08/2019. Submissions of the assessee on 26/08/2019 were not found satisfactory by the Ld CIT(E) and following discrepancies were noted : ITA No.201/RPR/2019 4 (i) Proof of filing /uploading Electronic Form No.10B not filed hence 80G(5)(i) not fulfilled. (ii) Proper Seal Sign of the Chartered Accountant who Audited the Accounts not shown on the Final accounts submitted. 11. Apparently, these observations were not brought to the knowledge of assessee to rebut with a mention that due to paucity of time since the case was getting time bared on 30.09.2019, the Ld CIT(E) was left with no alternative but to decide the matter on the basis of material available, the application of assessee for grant of 80G was refused and rejected. 12. In view of the aforesaid facts, it is evident that the information sought by Ld CIT(E) was furnished by the assessee, wherein discrepancies were observed by the Ld CIT(E). Application of the assessee was rejected on technicalities with a plea of time limitation. Discrepancies noted were not brought to the notice of assessee to place its defence before issuing the order of rejection, thus the assessee was at no default. This is a clear violation of principle of natural justice and supports assessee’s claim that rejection was made without grant of opportunity of being heard. No reasonable or justified cause for rejection was offered by the Ld CIT(E). Rejection cannot be made without properly appreciating the matter on the facts and law. 13. Though, we are of the considered view that the assessee is eligible for grant of 80G as per principle of law laid down by the Honble High Court and findings of coordinate bench of the tribunal in judgments quoted above. But, the peculiar observations of the CIT(E) with regard to discrepancies in application representing procedural lapse cannot be ITA No.201/RPR/2019 5 ignored and are required to be addressed. For compliance of the said deficiencies observed by the Ld CIT(E) in its order, a reasonable opportunity of being heard is to be granted to the assessee. Thus, we restore the matter back to the files of Ld CIT(E) having jurisdiction over the assessee to grand a reasonable opportunity of being heard and liberty to submit necessary information. It is directed that on satisfactory compliance in the matter by the assessee, the approval u/s 80G shall be granted to the assessee. 14. Thus, the sole ground raised by the assessee is partly allowed for statistical purposes. 15. In the result, the appeal of the assessee is partly allowed for statistical purposes. Order pronounced in pursuance to Rule 34(4) of ITAT Rules, 1963 on 17/10 / 2022. Sd/- (RAVISH SOOD) Sd/- (ARUN KHODPIA) न्यानयक सदस्य / JUDICIAL MEMBER ऱेखा सदस्य / ACCOUNTANT MEMBER रायऩ ु र/Raipur; ददनाांक Dated 17/10/2022 Prakash Kumar Mishra, Sr.P.S आदेश की प्रनतलऱपऩ अग्रेपषत/Copy of the Order forwarded to : आदेशान ु सार/ BY ORDER, (Assistant Registrar) आयकर अऩीऱीय अधधकरण, रायऩ ु र/ITAT, Raipur 1. अऩीऱाथी / The Appellant- 2. प्रत्यथी / The Respondent- 3. आयकर आय ु क्त(अऩीऱ) / The CIT(A), 4. आयकर आय ु क्त / CIT 5. विभागीय प्रयतयनधध, आयकर अऩीऱीय अधधकरण, रायऩ ु र/ DR, ITAT, Raipur 6. गार्ड पाईऱ / Guard file. सत्यावऩत प्रयत //True Copy//