M/s. Improvement Trust, Bathinda V. The Dy. Commissioner of Income-tax., Bathinda

ITA 409/ASR/2013

• Counselvise Citation: [2016] 121 COUNSELVISE.COM (IT) 2496 (ITAT-AMRITSAR)
• Duration Of Justice: 2 year(s) 6 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-01-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 14-12-2015
• Assessment Year: 2005-2006
• Appeal Filed On: 17-06-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: Y K SUD
• Keywords: Charitable institution; Cancellation of registration
• Section: 12A; 12AA; 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, AMRITSAR BENCH; AMRITSAR BEFORE SH. A.D. JAIN, JUDICIAL MEMBER AND SH. T.S. KAPOOR, ACCOUNTANT MEMBER ITA NOS. 65 & 66(ASR)/2015 ASSESSMENT YEARS:2005-06 & 2006-07 PAN: AAATE1563E IMPROVEMENT TRUST, VS. ASSTT. COMMR. OF INCOME TAX, DR. MELA RAM ROAD, CIRCLE-1, BATHINDA BATHINDA. (APPELLANT) (RESPONDENT) ITA NOS. 409 & 410(ASR)/2013 ASSESSMENT YEARS:2005-06 & 2006-07 PAN: AAATE1563E IMPROVEMENT TRUST, VS. DEPUTY COMMR. OF INCOME TAX, DR. MELA RAM ROAD, CIRCLE-1, BATHINDA BATHINDA. (APPELLANT) (RESPONDENT) ITA NO. 414(ASR)/2013 ASSESSMENT YEARS: 2006-07 PAN: AAATE1563E IMPROVEMENT TRUST, VS. ASSTT. COMMR. OF INCOME TAX, DR. MELA RAM ROAD, CIRCLE-1, BATHINDA BATHINDA. (APPELLANT) (RESPONDENT) APPELLANT BY: SH. Y.K. SUD, CA RESPONDENT BY: SMT. RATINDER KAUR, DR DATE OF HEARING: 14/12/2015 DATE OF PRONOUNCEMENT: 14/01/2016 ORDER ITA NOS.65 & 66(ASR)/2015 ITA NOS. 409, 410 & 414(ASR)/2013 2 PER A.D. JAIN, JM: THESE FIVE APPEALS FILED BY THE ASSESSEE ARE DIREC TED AGAINST DIFFERENT ORDERS OF THE CIT(A), BATHINDA, DATED 02. 12.2014, & 19.03.2013 RELATING TO ASSESSMENT YEARS 2005-06 & 2006-07. 2. FIRST, WE WILL DEAL WITH ITA NOS. 65 & 66(ASR)/2 015 FOR THE AYS 2005-06 & 2006-07. THE FACTS AS AVAILABLE FROM THE RECORD ARE THAT THE ASSESSEE-IMPROVEMENT TRUST IS A STATUTORY BODY CONS TITUTED BY THE PUNJAB TOWN IMPROVEMENT ACT, 1922. THERE ARE ABOUT 20 TRUSTS IN PUNJAB FOR THE DEVELOPMENT OF CITIES, HOUSING ACCOM MODATION, RE- HOUSING SCHEME, DEVELOPMENT AND EXPANSION SCHEME ET C. EARLIER THE INCOME OF SUCH TRUSTS WAS EXEMPT U/S 10(20A) OF THE I.T.ACT, UPTO 31.03.2002. THE SAID SECTION WAS OMITTED FROM THE STATUTE AND ALL THE TRUSTS IN PUNJAB APPLIED FOR REGISTRATION U/S 12A. THE AO FRAMED THE ASSESSMENT OF THE ASSESSEE TRUST FOR THE ASSTT. YEA RS 2005-06 & 2006-07 AND MADE ADDITIONS OF RS.4.06 CRORES AND RS.11.05, CRORES RESPECTIVELY, IN THE STATUS OF AOP BUT WITHOUT REGISTRATION. VIDE ORDER DATED 04.02.2010, THE LD. CIT(A) DISMISSED THE ASSESSEES APPEAL AND CONFIRMED THE ASSESSMENT ORDER. ON 16.08.2010 REGISTRATION WA S GRANTED BY THE LD. CIT TO THE ASSESSE W.E.F. 22.06.2003. THE ITAT, VID E ORDER DATED13.06.2011, SET ASIDE THE CIT(A)S AFORESAID O RDER DATED 04.02.2010. IT WAS OBSERVED AS UNDER: 5. WE HAVE HEARD BOTH THE PARTIES, CONSIDERED THE RIVAL SUBMISSIONS AND OTHER RELEVANT MATERIAL PLACED ON R ECORD. A REFERENCE TO DOCUMENTARY EVIDENCES FILED BY THE LD. COUNSEL FOR THE ASSESSEE CLEARLY REVEALS THAT THE ASSESSMEN T ORDER ITA NOS.65 & 66(ASR)/2015 ITA NOS. 409, 410 & 414(ASR)/2013 3 WAS FRAMED ON 19.03.2008. SIMILARLY, THE APPEAL OF THE AGAINST SUCH ORDER, WAS DECIDED BY THE CIT(A) ON 04 .02.2010. THE DATE OF THE ASSESSMENT ORDER AS WELL AS THE DA TE OF THE APPELLATE ORDER PRECEDES THE DATE OF REGISTRATION U NDER SECTION 12AA, GRANTED BY THE CIT(A) ON 16.08.2010. THEREFO RE, IT WOULD BE IN THE FITNESS OF THE FACTUAL POSITION O F THE CASE, AND IN THE LIGHT OF GRANT OF REGISTRATION TO THE AS SESSEE , THE ISSUE IS RESTORED TO THE FILE OF THE CIT(A), FOR FR ESH ADJUDICATION, IN ACCORDANCE WITH LAW, AFTER AFFORDING A REASONABL E OPPORTUNITY TO THE ASSESSEE. 3. THE LD. CIT(A), VIDE THE IMPUGNED ORDER PASSED O N 02.12.2014, AGAIN DECIDED THE MATTER AGAINST THE ASSESSEE TREA TING THE ASSESSEE AS THE ASSESSEE WITHOUT REGISTRATION U/S 12A OF THE A CT. IT WAS OBSERVED THAT THE LD. CIT HAD REVOKED THE REGISTRATION GRANT ED TO THE ASSESSEE, VIDE ORDER DATED 20.07.2012 AND THE ITAT, VIDE ORDER DAT ED 18.12.2012, PASSED IN ITA NO.366(ASR)/2012, HAD REFUSED TO INTE RFERE WITH THE LD. CITS ORDER PASSED U/S 12AA(3) OF THE ACT. IT WAS O BSERVED THAT THE SAID TRIBUNAL ORDER HAD BEEN CHALLENGED BY THE ASSESSEE BEFORE THE HONBLE HIGH COURT, WHICH MATTER HITHERTO WAS PENDING AND T HE OUTCOME THEREOF COULD NOT BE ANTICIPATED. THE HONBLE HIGH COURT, B Y VIRTUE OF ORDER DATED 06.08.2014, SET ASIDE THE TRIBUNAL ORDER AND RESTORED THE MATTER TO THE FILE OF THE ITAT, TO BE DECIDED AFRESH KEEP ING IN VIEW THE PUNJAB TOWN IMPROVEMENT TRUST ACT, 1922 AND THE PROVISO TO SECTION 2(15) INSERTED IN THE I.T. ACT W.E.F. 01.04.2009. THE ITA T PASSED ORDER DATED 31.08.2015, WHEREBY, THE CANCELLATION OF REGISTRATI ON OF THE ASSESSEE WAS QUASHED AND THE REGISTRATION WAS RESTORED TO THE AS SESSEE. ITA NOS.65 & 66(ASR)/2015 ITA NOS. 409, 410 & 414(ASR)/2013 4 4. THE LD. COUNSEL FOR THE ASSESSEE HAS CONTENDED B EFORE THIS BENCH THAT IN VIEW OF THE ABOVESAID DEVELOPMENTS, THESE A PPEALS OF THE ASSESSEE BE ALLOWED BY SETTING ASIDE THE ASSESSMENT ORDER AN D RESTORING THE MATTER TO THE FILE OF THE AO, TO MAKE ASSESSMENT OF THE ASSESSEE AFRESH, IN THE STATUS OF A REGISTERED CHARITABLE TRUST, ON THE LINES OF THE DECISION OF THE TRIBUNAL IN THE CASE OF HOSHIARPUR IMPROVEM ENT TRUST, 155 ITD (AMRITSAR) 570. 5. ON THE OTHER HAND, THE LD. DR PLACE STRONG RELIA NCE ON THE IMPUGNED ORDER. 6. ON CONSIDERING THE RIVAL CONTENTIONS IN THE LIGH T OF THE MATERIAL PLACED ON RECORD, IT IS SEEN THAT THE LD. CIT(A) PA SSED THE IMPUGNED ORDER HOLDING THE EARLIER FIRST APPELLATE ORDER DATED 04. 02.2010 TO REMAIN OPERATIVE IN THE ABSENCE OF THE REGISTRATION OF THE ASSESSEE, SINCE THE ISSUE OF REGISTRATION WAS HITHERTO PENDING ADJUDICA TION BEFORE THE HONBLE HIGH COURT. THE IMPUGNED ORDER WAS PASSED BY THE LD . CIT(A) ON 02.12.2014. AS NOTED, THE HONBLE HIGH COURT, VIDE ORDER DATED 06.08.2014, REMITTED THE MATTER TO THE TRIBUNAL FOR PASSING A FRESH ORDER KEEPING IN VIEW THE PROVISIONS OF PUNJAB TOWN IMPRO VEMENT TRUST ACT, 1922 AND THE PROVISO TO SECTION 2(15) OF THE ACT, W HICH WAS INTRODUCED W.E.F. 01.04.2009. ON 31.08.2015, THE TRIBUNAL QUAS HED THE ORDER OF THE CANCELLATION OF REGISTRATION OF THE ASSESSEE. ITA NOS.65 & 66(ASR)/2015 ITA NOS. 409, 410 & 414(ASR)/2013 5 7. THUS, AFTER THE PASSING OF THE IMPUGNED ORDER, T HE TRIBUNAL HAS RESTORED THE REGISTRATION OF THE ASSESSEE. THEREFOR E, THE MATER COMPRISING BOTH THESE APPEALS IS RESTORED TO THE AO WITH A DIR ECTION THAT THE ASSESSMENT FOR BOTH THESE YEARS BE FRAMED AFRESH IN VIEW OF THE AFORESAID TRIBUNAL ORDER DATED 31.08.2015, IN THE ASSESSEES STATUS OF A REGISTERED CHARITABLE TRUST U/S 12AA OF THE ACT, IN THE LIGHT OF THE TRIBUNAL DECISION IN THE CASE OF HOSHIARPUR IMPROVEMENT TRUST (SUPR A). 8. ITA NOS. 409 & 410(ASR)/2013 FOR THE ASSESSMENT YEARS 2005-06 & 2006-07: PENALTY LEVIED ON THE ASSESSEE FOR THE ASSESSMENT Y EARS 2005-06 & 2006-07 WAS CONFIRMED BY THE LD. CIT(A), AGAINST WH ICH THESE APPEALS HAVE BEEN FILED BY THE ASSESSEE. THE PENALTY IN QUE STION IS CONSEQUENTIAL TO ITA NOS. 65 & 66 (ASR)/2015, THE MATTER COMPRISI NG WHICH HAS BEEN RESTORED TO THE AO, AS ABOVE. ACCORDINGLY, THE SUBJ ECT MATTER OF ITA NOS. 409 & 410(ASR)/2013, I.E., THE LEVY OF PENALTY U/S 271(1)(C) OF THE ACT IS ALSO RESTORED TO THE FILE OF THE AO, TO BE DECIDED AFRESH AFTER THE PASSING OF THE QUANTUM ASSESSMENT ORDER WITH REGARD TO THE SUBJECT MATTER OF ITA NOS. 65 & 66(ASR)/2015. 9. ITA NO.414(ASR)/2013 FOR THE ASSESSMENT YEAR 200 6-07 FOR THE ASSESSMENT YEAR 2006-07, THE AO PASSED THE ORDER UNDER SECTION 154 OF THE ACT FOR CHARGING INTEREST U/S 23 4A. EVIDENTLY, THIS MATTER IS ALSO CONSEQUENTIAL IN NATURE. IT WOULD DE PEND ON THE DECISION TO BE TAKEN BY THE ITA NOS. 65 & 66(ASR)/2015, WHIC H HAS BEEN RESTORED ITA NOS.65 & 66(ASR)/2015 ITA NOS. 409, 410 & 414(ASR)/2013 6 TO THE AO. ACCORDINGLY, THERE REMAINING NO MERIT TH EREIN, THE IMPUGNED ORDER IS QUASHED. 10. IN THE RESULT, THE APPEALS IN ITA NOS. 65 & 66 (ASR)/2015 AND ITA NOS. 409 & 410(ASR)/2013 ARE TREATED AS ALLOWED FOR STATISTICAL PURPOSES, WHEREAS THE APPEAL IN ITA NO.414(ASR)/2013 IS ALLOW ED. ORDER PRONOUNCED IN THE OPEN COURT ON 14/01/2016 SD/- SD/- (T.S. KAPOOR) (A.D. JAIN) ACCOUNTANT MEMBER JUDICIAL MEM BER DATED: 14/01/2016 /SKR/ COPY OF ORDER FORWARDED TO: 1. THE ASSESSEE: IMPROVEMENT TRUST, BATHINDA. 2. THE ACIT/DCIT CIRCLE-1, BATHINDA. 3. THE CIT(A), BATHINDA. 4. THE CIT, BATHINDA. 5. THE SR. DR, ITAT, ASR. TRUE COPY BY ORDER (ASSISTANT REGISTRAR) INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH: AMRITSAR.