Krishi Ptpanna Bazar Samiti, Dhule V. CIT I Nasik,

ITA 363/PUN/2009

• Counselvise Citation: [2010] 135 COUNSELVISE.COM (IT) 3348 (ITAT-PUNE)
• Duration Of Justice: 5 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-08-2010
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: misc
• Appeal Filed On: 25-03-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MUKULESH DUBEY
• Keywords: Charitable institution; Bonafide belief; Condonation of delay
• Section: 12A; 12AA; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH, B PUNE BEFORE SHRI I.C. SUDHIR, JM AND SHRI R.C. SHARMA, AM I.T.A. NO. 363/PN/2009 KRISHI UTPANNA BAZAR SAMITI, DONDAICHA, TAL. SHINDKHEDA, DIST. DHULE, PAN AABTA 7165 M APPELLANT VS. COMMISSIONER OF INCOME-TAX I, NASIK RESPONDENT APPELLANT BY : SHRI SUNIL GANOO RESPONDENT BY: SHRI MUKULESH DUBEY ORDER PER I.C. SUDHIR, JM THE APPELLANT HAS QUESTIONED THE ACTION OF LEARNED CIT MAINLY ON THE GROUND THAT THE LEARNED CIT IS NOT JU STIFIED IN NOT CONDONING THE DELAY WHEN THE APPELLANT HAS REAS ONABLE CAUSE FOR FAILURE TO FILE AN APPLICATION FOR REGIST RATION IN TIME AND REFUSING REGISTRATION FOR EARLIER PERIOD. 2. AT THE OUTSET OF HEARING, THE LEARNED AR POINTED OUT THAT THE ISSUE RAISED IS COVERED BY THE DECISION OF PUNE BENCH OF THE TRIBUNAL IN THE CASE OF PIMPRI CHINCHWAD NEW TO WN DEVELOPMENT AUTHORITY VS. ITO (HQ) (TECH) PUNE (ITA NO. 1432/PN/2009 VIDE ORDER DATED 19-5-2010). HE SUBMI TTED FURTHER THAT THE HONBLE SUPREME COURT RECENTLY HAS ITA NO. 363/PN/2009 KRISHI UTPANNA BAZAR SAMITI, NASIK 2 DISMISSED THE SLP IN THE CASE OF CIT VS. KRISHI UPA J MANDI SAMITI : SLP(C) NO. 27701 OF 2008 (2008) 307 ITR ( STATUTE) 7. PREFERRED BY THE REVENUE AGAINST THE JUDGMENT OF HO NBLE MADHYA PRADESH HIGH COURT IN ITA NOS. 253-312 OF 20 07 WHEREBY THE HONBLE HIGH COURT DISMISSED THE DEPART MENTS APPEALS HOLDING THAT THE MARKET COMMITTEE FULFILS A LL THE REQUIREMENTS OF SECTION 11 AND GOT EXEMPTION AND TH EREFORE, WERE ENTITLED TO REGISTRATION U/S 12, 12A AND 12AA OF THE ACT, REGARDING THE DELAY IN FILING AN APPLICATION FOR RE GISTRATION THE LEARNED AR SUBMITTED THAT THE APPELLANT TRUST IS FU NCTIONING IN A VILLAGE WHICH IS A BACKWARD AREA AND OFFICE BEARE RS ARE NOT WELL VERSED WITH THE PROVISIONS OF THE ACT. THE IN COME OF APPELLANT SAMITTEE WAS EXEMPT U/S 10(20)/10(22) OF THE ACT TILL 31-3-2003 AND FROM 1-4-2003 THE INCOME OF THE APPELLANT HAS BECOME TAXABLE. THE APPELLANT BEING FUNCTIONI NG IN BACKWARD RURAL AREA WAS NOT AWARE OF THE AMENDMENT IN THE INCOME-TAX ACT AND WAS THUS UNDER BONAFIDE BELIEF T HAT THE COMMITTEE IS DOING SOCIAL WORK AND IS COVERED BY SE CTION 2(15) OF THE ACT. ON REALIZING THE FACT THE APPELLANT HA D FILED AN APPLICATION FOR REGISTRATION U/S 12AA FROM 1-4-2002 ON 30-3- 2006. THE LEARNED CIT REFUSED REGISTRATION ON THE GROUND THAT THE COMMITTEE IS NOT A CHARITABLE INSTITUTION. AGAI NST THIS REFUSAL, THE APPELLANT PREFERRED AN APPEAL BEFORE T HE TRIBUNAL AND THE TRIBUNAL VIDE ITS ORDER DATED 22-6-2007 IN ITA NO. 1128/PN/2006 DIRECTED TO GRANT REGISTRATION U/S 12A A TO THE ITA NO. 363/PN/2009 KRISHI UTPANNA BAZAR SAMITI, NASIK 3 COMMITTEE. IN COMPLIANCE THERETO, THE LEARNED CIT HAS GRANTED REGISTRATION FROM 1-4-2005 INSTEAD OF 1-4-2 002 AS ASKED FOR WITHOUT CONDONING THE DELAY. 3. THE LEARNED DR ON THE OTHER HAND TRIED TO JUSTI FY THE ORDER IMPUGNED WITH THIS SUBMISSION THAT THE APPELL ANT HAS FAILED TO ESTABLISH SUFFICIENT REASONS FOR NOT FILI NG AN APPLICATION FOR REGISTRATION IN TIME AND THE LEARNE D CIT HAS RIGHTLY REJECTED THE CONDONATION OF DELAY APPLICATI ON MOVED BY THE APPELLANT BEFORE HIM. 4. THE WHOLE ISSUE IN THE PRESENT MATTER IS AS TO W HETHER THERE WAS SUFFICIENT REASON WITH THE APPELLANT PREV ENTING THEM TO FILE AN APPLICATION FOR ITS REGISTRATION U/S 12A (A) OF THE ACT IN TIME. THE LEARNED CIT WAS OF THE VIEW THAT REAS ONS SHOWN FOR THE DELAY IN FILING AN APPLICATION FOR REGISTRA TION WERE NOT SUFFICIENT TO CONDONE THE SAME TO ALLOW REGISTRATIO N WITH EFFECT FROM 1-4-2002. SIMILAR REASONS, AS DISCUSSED HEREIN ABOVE, IN THE SUBMISSIONS OF THE LEARNED AR, WERE SHOWN BEFO RE THE LEARNED CIT. THESE REASONS REMAINED THAT TILL 31-3 -2003, THE APPELLANT WAS ENJOYING EXEMPTION U/S 10(20)/10(22) OF THE ACT. THE APPELLANT IS FUNCTIONING IN BACKWARD RURA L AREA AND THUS WAS NOT AWARE OF THE AMENDMENT IN THE INCOME-T AX ACT WHEREBY ITS INCOME BECAME TAXABLE WITH EFFECT FROM 1-4-2003. THE APPELLANT WAS UNDER BOANFIDE BELIEF THAT IT IS DOING SOCIAL ITA NO. 363/PN/2009 KRISHI UTPANNA BAZAR SAMITI, NASIK 4 WORK AND IS COVERED BY SECTION 2(15) OF THE ACT FOR ADVANCEMENT OF ANY OTHER OBJECT OF GENERAL PUBLIC U TILITY. WHEN IT REALIZED, THE APPELLANT FILED AN APPLICATIO N FOR REGISTRATION U/S 12A ON 30-3-2006 FOR GETTING REGIS TRATION FROM 1-4-2002 I.E. FROM THE DATE WHEN THE INCOME OF THE APPELLANT BECAME TAXABLE. KEEPING IN MIND, THE TOTALITY OF T HE FACTS AND CIRCUMSTANCES OF THE CASE ESPECIALLY THAT THE APPEL LANT IS FUNCTIONING IN A BACKWARD RURAL AREA, WE ARE OF TH E VIEW THAT THE REASONS SHOWN FOR THE DELAY IN FILING THE APPLI CATION FOR REGISTRATION IS SUFFICIENT TO CONDONE THE DELAY IN FILING AN APPLICATION FOR REGISTRATION WITH EFFECT FROM 1-4-2 002. WE, THUS, WHILE CONDONING THE DELAY IN FILING AN APPLIC ATION FOR GRANTING REGISTRATION WITH EFFECT FROM 1-4-2002, SE T ASIDE THE ORDER IMPUGNED WITH DIRECTION TO LEARNED CIT TO GRA NT REGISTRATION U/S 12A READ WITH SECTION 12AA ON FULF ILLMENT OF ITS OTHER CONDITIONS WITH EFFECT FROM 1-4-2002. TH E GROUND IS ACCORDINGLY ALLOWED. CONSEQUENTLY THE APPEAL IS ALL OWED. 5. IN THE RESULT, THE APPEAL IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 31 ST AUGUST 2010. SD/- SD/- (R.C. SHARMA) (I.C. SUDHIR) ACCOUNTANT MEMBER JUDICIAL MEMBER PUNE,DATED THE 31 ST AUGUST 2010 ANKAM ITA NO. 363/PN/2009 KRISHI UTPANNA BAZAR SAMITI, NASIK 5 COPY FORWARDED TO: (1) ASSESSEE (2) DEPARTMENT (3) CIT- (A) I NASIK (4) CIT I NASIK (5) THE D.R. B BENCH, PUNE TRUE COPY BY ORDER, ASSISTANT REGISTRAR INCOME-TAX APPELLATE TRIBUNAL, PUNE BENCHES, PUNE