Shaktipada Bhattarjee Technical Institute, Burdwan V. The Commissioner of Income Tax Burdwan, Burdwan

ITA 2783/KOL/2013

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 9173 (ITAT-KOLKATA)
• Duration Of Justice: 3 year(s) 3 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-03-2017
• Appeal Filed By: Assessee
• Bench Allotted: C
• Next Hearing Date: 14-09-2016
• Assessment Year: misc
• Appeal Filed On: 16-12-2013
• Court: TRIBUNAL
• Department Lawyers: G MALLIKARJUNA
• Assessee Lawyers: P S GUPTA
• Keywords: Principle of natural justice
• Section: 80G; 12A

Judgement Text

1 ITA NOS.2783 & 2785/KOL/2013 SHAKTIPADA BHATTACHARJEE TECHNICAL INSTITUTE, IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH: KOL KATA [BEFORE SHRI A. T. VARKEY, JM & DR. A. L. SAINI, A M] I.TA NOS. 2783 & 2785/KOL/2013 ASSESSMENT YEAR: SHAKTIPADA BHATTACHARJEE TECHNICAL INSTITUTE (PAN: AAEAS1223L) VS. COMMISSIONER OF INCOME-TAX, BURDWAN APPELLANT RESPONDENT DATE OF HEARING 17.01.2017 DATE OF PRONOUNCEMENT 29.03.2017 FOR THE APPELLANT SHRI P. S. GUPTA, ADVOCATE FOR THE RESPONDENT SHRI G. MALLIKARJUNA, CIT, DR ORDER PER SHRI A.T.VARKEY, JM BOTH THESE APPEALS PREFERRED BY THE ASSESSEE SOCIET Y AGAINST THE COMMON ORDER OF LD. CIT, BURDWAN DATED 30.09.2013 REJECTING THE APPLICATION FOR REGISTRATION U/S. 12A AND APPROVAL U/S. 80G(5)(VI) OF THE INCOME-TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT). 2. THE MAIN GRIEVANCE OF THE ASSESSEE IS AGAINST TH E REJECTION OF THE APPLICATION U/S. 12A AND THE APPROVAL U/S. 80G OF THE ACT. BRIEF FA CTS OF THE CASE IS THAT THE ASSESSEE SOCIETY FILED AN APPLICATION ON 03.04.2013 FOR REGI STRATION U/S. 12A OF THE ACT AND FOR APPROVAL U/S. 80G(5)(VI) OF THE ACT. HOWEVER, THE LD. CIT WAS PLEASED TO REJECT BOTH THE APPLICATIONS ON THE GROUND THAT THE ENQUIRY CON DUCTED BY HIM COULD NOT YIELD ANY EVIDENCE AS TO THE ASSESSEE IS ENGAGED IN ANY ACTIV ITY OF CHARITY AND THERE WAS NO PROOF OR ELEMENT OF CHARITY IN ITS ACTIVITY. ACCORDING T O THE LD. CIT, FROM THE ENQUIRY REPORT IT APPEARS THAT THE SOCIETY IS ENGAGED ONLY F OR ANY OTHER OBJECT OF GENERAL PUBLIC 2 ITA NOS.2783 & 2785/KOL/2013 SHAKTIPADA BHATTACHARJEE TECHNICAL INSTITUTE, UTILITY AND HE FOUND FAULT WITH THE DISSOLUTION CLAUSE OF T HE REGULATION OF THE ASSOCIATION AND HE OBSERVED THAT THE ASSESSEE SOCIE TY COULD NOT PRODUCE THE INCOME AND EXPENDITURE ACCOUNT FOR THE FY 2012-13 THOUGH O PPORTUNITY WAS GRANTED TO IT SEVERAL TIMES. ON THESE GROUNDS BOTH THE APPLICATI ONS WERE DISMISSED. AGGRIEVED BY THE DENIAL OF REGISTRATION U/S. 12A AND APPROVAL U/ S. 80G OF THE ACT, THE ASSESSEE IS BEFORE US. 3. WE HAVE HEARD RIVAL SUBMISSIONS AND GONE THROUGH FACTS OF THE CASE. WE NOTE THAT ON THE BASIS OF AN ENQUIRY REPORT, REGISTRATIO N U/S. 12A AND APPROVAL U/S. 80G OF THE ACT WAS DENIED TO THE ASSESSEE SOCIETY. THE MAIN GR IEVANCE OF THE ASSESSEE IS THAT THE SAID ENQUIRY REPORT HAS NOT BEEN GIVEN TO THE ASSES SEE SO THAT IT COULD HAVE BEEN ABLE TO DEFEND ITS CASE. WE TAKE NOTE THAT THE ASSESSEE HA S ASSERTED THAT THE P&L ACCOUNT WAS PRODUCED BEFORE THE LD. CIT ON 30.09.2013. SO, ACC ORDING TO LD AR, THE LD. CIT HAS MADE A FACTUAL ERROR BY HOLDING THAT THE ASSESSEE F AILED TO PRODUCE THE P&L ACCOUNT BEFORE HIM. THE ASSESSEE ALSO CLAIMS TO HAVE DULY INCORPORATED SAFEGUARD IN THE DEED BY AMENDMENT OF MEMORANDUM OF ASSOCIATION OF THE SO CIETY WHEREIN THE DISSOLUTION CLAUSE OF THE REGULATION OF ASSOCIATION TAKES CARE OF THE FUND OF THE SOCIETY. SO, ACCORDING TO THE ASSESSEE SOCIETY, THE REASONS ATTR IBUTED BY THE LD. CIT TO DENY THE REGISTRATION AND THE APPROVAL U/S. 80G OF THE ACT H AS BEEN ERRONEOUSLY DONE. WE NOTE THAT THE MAIN BASIS ON WHICH THE LD. CIT CAME TO TH E CONCLUSION THAT THE ASSESSEE IS NOT DOING ANY CHARITY WAS BASED ON AN ENQUIRY CONDUCTED BY HIM, ADMITTEDLY BEHIND THE BACK OF THE ASSESSEE AND THAT THE ASSESSEE WAS NOT GIVEN A COPY OF THE SAME. IT IS TRUE THAT THE LD. CIT HAS AMPLE POWER TO CONDUCT ENQUIRY , EVEN A DISCREET ONE WHICH IS AN ADMINISTRATIVE DECISION. HOWEVER, IF THAT REPORT B ECOMES THE BASIS FOR DRAWING ADVERSE INFERENCE AGAINST THE ASSESSEE THEN IT WAS INCUMBEN T UPON THE LD. CIT TO HAVE GIVEN A COPY TO THE ASSESSEE SO THAT IT COULD GIVE ITS DEFE NCE/EXPLANATION, WITHOUT DOING SO THE IMPUGNED ORDER IS FRAGILE FOR VIOLATION OF NATURAL JUSTICE. THEREFORE, WE ARE INCLINED TO SET ASIDE BOTH THE ORDERS (COMMON ORDER) OF LD. CIT AND REMIT THE SAME BACK TO HIM FOR DE NOVO CONSIDERATION OF BOTH APPLICATIONS. TH E LD. CIT IS DIRECTED TO GIVE A COPY OF THE ENQUIRY REPORT IF HE IS INTENDING TO USE IT AGAINST THE ASSESSEE. WITH THE AFORESAID 3 ITA NOS.2783 & 2785/KOL/2013 SHAKTIPADA BHATTACHARJEE TECHNICAL INSTITUTE, OBSERVATION, BOTH THE APPLICATIONS OF ASSESSEE ARE REMITTED BACK TO THE FILE OF LD. CIT FOR DE NOVO CONSIDERATION AND THE LD. CIT IS DIRECT ED TO DECIDE ON BOTH THE APPLICATIONS IN ACCORDANCE TO LAW. APPEALS OF ASSESSEE ARE ALLO WED FOR STATISTICAL PURPOSES. 4. IN THE RESULT, APPEALS OF ASSESSEE ARE ALLOWED F OR STATISTICAL PURPOSES. ORDER IS PRONOUNCED IN THE OPEN COURT ON 29.03.201 7 SD/- SD/- (DR. A. L. SAINI) (ABY. T. VARKEY) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 29TH MARCH, 2017 JD.(SR.P.S.) COPY OF THE ORDER FORWARDED TO: 1 . APPELLANT SHAKTIPADA BHATTACHARJEE TECHNICAL INST ITUTE, VILL- DIGHIRKONE, P.O. UCHALAN, DIST. BURDWAN, PIN-713427 2 RESPONDENT C.I.T.- BURDWAN. 3 . THE CIT(A), KOLKATA 4. 5. CIT , KOLKATA DR, KOLKATA BENCHES, KOLKATA / TRUE COPY, BY ORDER, ASSTT. REGISTRAR .