Madarsa Asharaful Uloom Rashidi, Saharanpur V. CIT(E), Lucknow

ITA 2261/DEL/2016

• Counselvise Citation: [2018] 121 COUNSELVISE.COM (IT) 5392 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 11 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-04-2018
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: F
• Assessment Year: 2016-2017
• Appeal Filed On: 27-04-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: DEEPALI CHANDRA
• Assessee Lawyers: S.D. JAIN
• Keywords: Opportunity of being heard
• Section: 12; 11; 12A; 12AA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: F NEW DELHI BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBE R & SHRI P. MAHARISHI, ACCOUNTANT MEMBER ITA NO.-2261/DEL/2016 ( ASSESSMENT YEAR: 2016-17) MADARSA ASHARAFUL ULOOM RASHIDI BUS STAND, POST AND TOWN GANGOH, SAHARANPUR PAN NO. AADAM8242L VS CIT(E) LUCKNOW ASSESSEE BY SH. S.D. JAIN, CA REVENUE BY SMT. DEEPALI CHANDRA, CIT DR ORDER PER JOGINDER SINGH, J.M. THE ASSESSEE IS AGGRIEVED BY THE IMPUGNED ORDER DAT ED 24.02.2016 OF THE LD. COMMISSIONER OF INCOME TAX (E XEMPTION), LUCKNOW REJECTING THE APPLICATION FOR REGISTRATION U/S 12A(1) AND CONSEQUENT ORDER U/S 12AA(1)(B)(II) OF THE INCOME T AX ACT, 1961 (HEREINAFTER THE ACT). 2. DURING HEARING, THE LD. COUNSEL FOR THE ASSESSEE SHRI S.D. JAIN CONTENDED THAT PROPER OPPORTUNITY OF BEING HEARD WA S NOT PROVIDED TO DATE OF HEARING 03.04.2018 DATE OF PRONOUNCEMENT 03 .04.2018 ITA NO. 226 1 /DEL/2016 MADARSA ASHARAFUL ULOOM RASHIDI 2 THE ASSESSEE FOR WHICH OUR ATTENTION WAS INVITED TO THE IMPUGNED ORDER. IT WAS CONTENDED THAT THE APPLICATION OF TH E ASSESSEE WAS SUMMARILY REJECTED MERELY ON THE BASIS OF EARLIER O RDER DATED 12.08.2015. ON THE OTHER HAND, THE LD. CIT (DR) SM T. DEEPALI CHANDRA STRONGLY DEFENDED THE IMPUGNED ORDER BY CON TENDING THAT THE ASSESSEE COULD NOT SUBSTANTIATE ITS CASE AND EV EN DID NOT ELABORATE THE FACTS PROPERLY. 2.1 WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PE RUSED THE MATERIAL AVAILABLE ON RECORD. BEFORE ADVERTING FUR THER WE ARE REPRODUCING HEREUNDER THE PROVISION OF SECTION 12A OF THE ACT FOR READY REFERENCE AND ANALYSIS: - [(1)] THE PROVISIONS OF SECTION 11 AND SECTION 12 SHALL NOT APPLY IN RELATION TO THE INCOME OF ANY TRUST OR INSTITUTION UNLESS THE FOLLOWING CONDITIONS ARE FULFILLED, NAMELY: (A) THE PERSON IN RECEIPT OF THE INCOME HAS MADE AN APPLICATION FOR REGISTRATION OF THE TRUST OR INSTITUTION IN THE PRE SCRIBED FORM AND IN THE PRESCRIBED MANNER TO THE [***] COMMISSIONER BEFORE THE 1ST DAY OF JULY, 1973, OR BEFORE THE EXPIRY OF A PERIOD OF ONE YEAR FROM THE DATE OF THE CREATION OF THE TRUST OR THE ESTABLISHMENT OF T HE INSTITUTION, [WHICHEVER IS LATER AND SUCH TRUST OR INSTITUTION I S REGISTERED UNDER SECTION 12AA ] : [PROVIDED THAT WHERE AN APPLICATION FOR REGISTRATIO N OF THE TRUST OR INSTITUTION IS MADE AFTER THE EXPIRY OF THE PERIOD AFORESAID, THE PROVISIONS OF SECTIONS 11 AND 12 SHALL APPLY IN REL ATION TO THE INCOME OF SUCH TRUST OR INSTITUTION, (I) FROM THE DATE OF THE CREATION OF THE TRUST OR T HE ESTABLISHMENT OF THE INSTITUTION IF THE [***] COMMISSIONER IS, FOR REASO NS TO BE RECORDED IN WRITING, SATISFIED THAT THE PERSON IN RECEIPT OF TH E INCOME WAS PREVENTED FROM MAKING THE APPLICATION BEFORE THE EXPIRY OF TH E PERIOD AFORESAID FOR SUFFICIENT REASONS; (II) FROM THE 1ST DAY OF THE FINANCIAL YEAR IN WHIC H THE APPLICATION IS MADE, IF THE [***] COMMISSIONER IS NOT SO SATISFIED :] [PROVIDED FURTHER THAT THE PROVISIONS OF THIS CLAUS E SHALL NOT APPLY IN RELATION TO ANY APPLICATION MADE ON OR AFTER THE 1S T DAY OF JUNE, 2007;] ITA NO. 226 1 /DEL/2016 MADARSA ASHARAFUL ULOOM RASHIDI 3 [(AA) THE PERSON IN RECEIPT OF THE INCOME HAS MADE AN APPLICATION FOR REGISTRATION OF THE TRUST OR INSTITUTION ON OR AFTE R THE 1ST DAY OF JUNE, 2007 IN THE PRESCRIBED FORM AND MANNER TO THE COMMI SSIONER AND SUCH TRUST OR INSTITUTION IS REGISTERED UNDER SECTI ON 12AA;] (B) WHERE THE TOTAL INCOME OF THE TRUST OR INSTITUT ION AS COMPUTED UNDER THIS ACT WITHOUT GIVING EFFECT TO [THE PROVISIONS O F SECTION 11 AND SECTION 12 EXCEEDS THE MAXIMUM AMOUNT WHICH IS NOT CHARGEABLE TO INCOME-TAX IN ANY PREVIOUS YEAR], THE ACCOUNTS OF T HE TRUST OR INSTITUTION FOR THAT YEAR HAVE BEEN AUDITED BY AN ACCOUNTANT AS DEFINED IN THE EXPLANATION BELOW SUB-SECTION (2) OF SECTION 288 AN D THE PERSON IN RECEIPT OF THE INCOME FURNISHES ALONG WITH THE RETU RN OF INCOME FOR THE RELEVANT ASSESSMENT YEAR THE REPORT OF SUCH AUDIT I N THE PRES-CRIBED FORM DULY SIGNED AND VERIFIED BY SUCH ACCOUNTANT AN D SETTING FORTH SUCH PARTICULARS AS MAY BE PRESCRIBED.] (C) [***] [(2) WHERE AN APPLICATION HAS BEEN MADE ON OR AFTER THE 1ST DAY OF JUNE, 2007, THE PROVISIONS OF SECTIONS 11 AND 12 SH ALL APPLY IN RELATION TO THE INCOME OF SUCH TRUST OR INSTITUTION FROM THE ASSESSMENT YEAR IMMEDIATELY FOLLOWING THE FINANCIAL YEAR IN WHICH S UCH APPLICATION IS MADE.] 2.2 WE ARE ALSO REPRODUCING HEREUNDER SECTION 12AA OF THE ACT WHERE PROCEDURE FOR REGISTRATION HAS BEEN PROVIDED: - (1) THE COMMISSIONER, ON RECEIPT OF AN APPLICATION FOR REGISTRATION OF A TRUST OR INSTITUTION MADE UNDER C LAUSE (A) [OR CLAUSE (AA) OF SUB-SECTION (1)] OF SECTION 12A , SHALL (A) CALL FOR SUCH DOCUMENTS OR INFORMATION FROM THE TRUST OR INSTITUTION AS HE THINKS NECESSARY IN ORDER TO SATI SFY HIMSELF ABOUT THE GENUINENESS OF ACTIVITIES OF THE TRUST OR INSTI TUTION AND MAY ALSO MAKE SUCH INQUIRIES AS HE MAY DEEM NECESSARY I N THIS BEHALF; AND (B) AFTER SATISFYING HIMSELF ABOUT THE OBJECTS OF T HE TRUST OR INSTITUTION AND THE GENUINENESS OF ITS ACTIVITIES, HE - (I) SHALL PASS AN ORDER IN WRITING REGISTERING THE TRUST OR INSTITUTION; (II) SHALL, IF HE IS NOT SO SATISFIED, PASS AN ORDE R IN WRITING REFUSING TO REGISTER THE TRUST OR INSTITUTION, AND A COPY OF SUCH ORDER SHALL BE SENT TO THE APPLICANT : PROVIDED THAT NO ORDER UNDER SUB-CLAUSE (II) SHALL BE PASSED UNLESS THE APPLICANT HAS BEEN GIVEN A REASONABLE OP PORTUNITY OF BEING HEARD. 2.3 IF THE AFORESAID PROVISION OF SECTION 12AA OF T HE ACT ARE ANALYZED THE PR. COMMISSIONER OR THE COMMISSIONER O N RECEIPT OF AN ITA NO. 226 1 /DEL/2016 MADARSA ASHARAFUL ULOOM RASHIDI 4 APPLICATION FOR REGISTRATION OF A TRUST OR INSTITUT ION MADE UNDER CLAUSE (A) OR CLAUSE (AA) OF SUB-SECTION (1) OF SECTION 12 A IS TO CALL FOR SUCH DOCUMENTS OR INFORMATION FROM SUCH TRUST OR INSTITU TION AS HE THINKS NECESSARY IN ORDER TO SATISFY HIMSELF ABOUT THE GEN UINENESS OF ACTIVITIES OF SUCH TRUST OR INSTITUTION AND MAY ALS O MAKE SUCH ENQUIRIES AS HE DEEMED NECESSARY AND AFTER (B) SATI SFYING HIMSELF ABOUT THE OBJECTS OF THE TRUST/INSTITUTION AND THE GENUINENESS OF THE ACTIVITIES HE SHALL PASS AN ORDER IN WRITING PROVID ED THAT NO ORDER UNDER SUB-CLAUSE (II) SHALL BE PASSED UNLESS THE AP PLICANT HAS BEEN GIVEN A REASONABLE OPPORTUNITY OF BEING HEARD. IF THE PROVISION OF THE ACT IS ANALYZED IT IS THE BOUNDED DUTY OF THE AUTHO RITY TO PROVIDE REASONABLE OPPORTUNITY. BEFORE US THE CLAIM OF THE ASSESSEE IS THAT THE REASONABLE OPPORTUNITY WAS NOT PROVIDED TO THE ASSESSEE AND MERELY THE APPLICATION OF THE ASSESSEE OR REGISTRAT ION U/S 12AA WAS REJECTED MERELY ON THE BASIS OF EARLIER ORDER DATED 12.08.2015, REJECTED BY THE LD. CIT (E) AND THE ASSESSEE HAS NO T CHALLENGED THAT ORDER BEFORE THE TRIBUNAL. ON PERUSAL OF THE ORDER AND WITHOUT GOING INTO MUCH DELIBERATION, WE DEEM IT APPROPRIATE THAT THE ASSESSEE BE GIVEN PROPER OPPORTUNITY OF BEING HEARD AND DECIDE IN ACCORDANCE WITH LAW. THE ASSESSEE IS ALSO DIRECTED TO SUBSTAN TIATE ITS CLAIM, WITH RESPECT TO OBJECTS OF THE TRUST AND GENUINENESS OF ITS ACTIVITIES, THUS, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTIC AL PURPOSES ONLY. ITA NO. 226 1 /DEL/2016 MADARSA ASHARAFUL ULOOM RASHIDI 5 FINALLY, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES ONLY. THIS ORDER WAS PRONOUNCED IN THE OPEN COURT, IN THE PRESENCE OF LD. REPRESENTATIVES FROM BOTH SIDES AT THE CONCL USION OF THE HEARING ON 03.04.2018. SD/- SD/- (P. MAHARISHI) (JOGINDER S INGH) ACCOUNTANT MEMBER JUDICIAL M EMBER DATED: 03.04.2018 *KAVITA ARORA COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT TRUE COPY ASSISTANT REGISTRAR ITAT NEW DELHI ITA NO. 226 1 /DEL/2016 MADARSA ASHARAFUL ULOOM RASHIDI 6 THIS ORDER WAS DIRECTLY DICTATED ON COMPUTER TO THE P.S. 03.04.2018 DRAFT DICTATED ON 03.04.2018 DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER 03.04.2018 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER. 03.04.2018 APPROVED DRAFT COMES TO THE SR.PS/PS 03.04.2018 KEPT FOR PRONOUNCEMENT ON 03.04.2018 FILE SENT TO THE BENCH CLERK 03.04.2018 DATE ON WHICH FILE GOES TO THE AR DATE ON WHICH FILE GOES TO THE HEAD CLERK. DATE OF DISPATCH OF ORDER.