The South India Photographic & Allied, CHENNAI V. ITO, CHENNAI

ITA 2211/CHNY/1994

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 64104 (ITAT-CHENNAI)
• Duration Of Justice: 17 year(s) 9 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-08-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 1983-1984
• Appeal Filed On: 14-10-1994
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: K RAJAGOPAL
• Assessee Lawyers: T VASUDEVAN
• Keywords: Charitable institution; Principle of natural justice
• Section: 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH CHENNAI BEFORE DR. O. K. NARAYANAN, VICE PRESIDENT AND SHRI V. DURGA RAO, JUDICIAL MEMBER .. ITA NO. 2211/MDS/1994 ASSESSMENT YEAR:1983-84 THE SOUTH INDIA PHOTOGRAPHIC & ALLIED TRADERS ASSOCIATION, 640, MOUNT ROAD, CHENNAI-600 006. V. THE INCOME TAX OFFICER, TRUST CIRCLE-I(2), CHENNAI. GIR NO. 9792-S (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI T. VASUDEVAN, ADVOCATE RESPONDENT BY : SHRI K. RAJAGOPAL, JCIT DATE OF HEARING : 07.0 8.2012 DATE OF PRONOUNCEMENT : 07.08.201 2 O R D E R PER V. DURGA RAO, JUDICIAL MEMBER : THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF CIT(APPEALS)-I, CHENNAI DATED 23-03-1988 FOR THE A SSESSMENT YEAR 1983-84. ITA NO.2211/MDS/1994 2 2. THE FACTS IN BRIEF ARE THAT THE ASSESSEE IS A PU BLIC CHARITABLE TRUST. BY A RESOLUTION OF THE BOARD OF TRUSTEES MAD E ON 08-06-1974 THE ASSESSEE RESOLVED TO ACCUMULATE 90% OF THE SURP LUS OF EACH FINANCIAL YEAR FOR A PERIOD OF 10 YEARS FOR THE PUR CHASE OF A NEW BUILDING OR TO CONSTRUCT AN ADDITIONAL FLOOR ON THE EXISTING BUILDING AND TO KEEP THE ACCUMULATED MONEY IN A SEPARATE BAN K ACCOUNT. 3. THE ONLY ISSUE FOR CONSIDERATION BEFORE US IS WH ETHER THE ASSESSEE HAS TO FILE AN APPLICATION IN FORM NO.10 E VERY YEAR FOR THE PURPOSE OF EXEMPTION U/S 11 OF THE INCOME TAX ACT, 1961. AT THE TIME OF HEARING THE LEARNED COUNSEL FOR THE ASSESSE E HAS SUBMITTED THAT THE ISSUE INVOLVED IN THIS APPEAL IS COVERED B Y THE DECISION OF THE TRIBUNAL IN THE ASSESSEES OWN CASE IN ITA NO. 103 7/MDS/87 FOR ASSESSMENT YEAR 1982-83 DATED 30 TH APRIL, 1991. 4. ON THE OTHER HAND, THE LEARNED DR FAIRLY ACCEPTE D THAT THE ISSUE IS COVERED IN FAVOUR OF THE ASSESSEE. 5. WE HAVE HEARD BOTH THE SIDES, PERUSED THE RECORD S AND GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. THE TRIBUNAL IN THE ASSESSEES CASE IN ITA NO. 1037/MDS/87 FOR THE ASSE SSMENT YEAR 1982-83 VIDE ORDER DATED 30-04-1991 HAS OBSERVED AS UNDER : HOWEVER, HE WAS OF THE VIEW THAT APPLICATION IN FORM NO. 10 HAD TO BE FILED FOR EACH YEAR AND SINCE SUCH AN APPLICATION WAS NOT FILED, EXEMPTION IN ITA NO.2211/MDS/1994 3 RESPECT OF THE AMOUNT SET APART IN THIS YEAR HAD TO BE DENIED. THE ASSESSEE IS IN APPEAL TO POINT OUT THAT THIS VIEW OF THE AUTHORITIES BELOW IS UNTENABL E. THE REVENUE WAS UNABLE TO POINT OUT TO ANY PROVISIONS IN THE ACT OR RULES WHICH REQUIRE THAT A N APPLICATION IN FORM NO.10 HAS TO BE FILED EVERY YEA R OR THAT SUCH A REQUIREMENT IS INSISTED UPON IN RESPECT OF OTHER CHARITABLE TRUST. THE FORM PRESCRIBED ITSELF REFERS TO A PERIOD OF MORE THAN O NE YEAR AND ONCE SUCH A FORM IS FILED AT THE COMMENCEMENT OF THE FIRST YEAR OF ACCUMULATION, THE INSISTENCE OF FILING SUCH A FORM FOR EACH YEAR IS WHOLLY UNNECESSARY. EVEN IF IT WERE A TECHNICAL DEFECT, THE PRINCIPLES OF NATURAL JUSTICE REQUIRE T HAT THE I.T.O. SHOULD HAVE GIVEN AN OPPORTUNITY TO THE ASSESSEE TO CURE THAT DEFECT PARTICULARLY WHEN HIS VIEW OF THE ACT AND RULES DIFFERED FROM THAT OF THE ASSESSEE AS WELL AS THE DEPARTMENT ITSELF, THOUGH THE AUTHORIZED REPRESENTATIVE OF THE DEPARTMENT LACKS THE AUTHORITY TO CONCEDE THIS POSITION. IN T HE CIRCUMSTANCES, WE HAVE NO HESITATION IN SETTING ASIDE THE ORDERS OF THE AUTHORITIES BELOW AND DIRECTING THE I.T.O. TO GRANT THE EXEMPTION AS CLAIMED BY THE ASSESSEE. THE APPEAL IS ALLOWED. NO MATERIAL WAS BROUGHT TO OUR NOTICE THAT THE ORDE R PASSED BY THE TRIBUNAL IN THE ABOVE CASE HAS BEEN REVERSED OR MOD IFIED BY THE HON'BLE JURISDICTIONAL HIGH COURT. IN VIEW OF THE ABOVE, RESPECTFULLY ITA NO.2211/MDS/1994 4 FOLLOWING THE ORDER OF THE TRIBUNAL IN THE ASSESSEE S OWN CASE, THIS GROUND OF APPEAL RAISED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT AT THE TIME OF HEARING ON TUESDAY, THE 07 TH OF AUGUST, 2012, AT CHENNAI. SD/- SD/- (DR. O. K. NARAYANAN) ( V.DURGA RAO ) VICE PRESIDENT JUDICIAL MEMBER CHENNAI, DATED THE 07 TH AUGUST, 2012. H. COPY TO: ASSESSEE/AO/CIT (A)/CIT/D.R./GUARD FILE