Shri Gujarati Machhu Kathia Darji Gnati Trust, Rajkot V. Income Tax Officer,(Exemption)-1, Rajkot

ITA 413/RJT/2017

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 1652 (ITAT-RAJKOT)
• Duration Of Justice: 2 year(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-12-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2014-2015
• Appeal Filed On: 24-11-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: NITIN KAMDAR
• Keywords: Charitable institution; Retrospective amendment
• Section: 143(3); 12A; 12AA; 205; 201; 13

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL, RAJKOT BENCH, RAJKOT (CONDUCTED THROUGH E - COURT AT AHMEDABAD) BEFORE SHRI WASEEM AHMED, ACCOUNTANT MEMBER AND MS . MADHUMITA ROY, JUDICIAL MEMBER ./ ITA NO . 413 /RJT /2017 / ASSTT. YEAR : 2014 - 20 15 SHRI GUJARATI MACHHU KATHIA DARJI GNATI TRUST , DARJI WADI, IOO, ABC MEDICAL STORE , SANGANWA CHOWK , RAJKOT . PAN: AAATG1455F VS . I.T.O , EXEMPTION - 1 , RAJKOT . (APPLICANT) (RESPON D ENT) ASSESSEE BY : SHRI NITIN KAMDAR , A.R REVENUE BY : SHRI SANJEEV JAIN , SR .D R / DATE OF HEARING : 1 5 / 10 / 201 9 / DATE OF PRONOUNCEMENT: 10 / 12 /201 9 / O R D E R PER WASEEM AHMED, ACCOUNTANT MEMBER : THE CAPTIONED APPEAL HAS BEEN FILED AT THE INSTANCE OF THE ASSESSEE AGAINST THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) - 3, RAJKOT DATED 22 /09/2017 ( IN SHORT LD.CIT(A) ) ARISING IN THE MATTER OF ASSESSMENT ORDER PASSED UNDER S. 143(3) OF THE INCOME TAX ACT, 1961 ( HERE - IN - AFTER REFERRED TO AS 'THE ACT') DT. 24/11 /2016 RELEVANT TO THE ASSESSMENT YEAR 2014 - 205 . ITA NO.413 /RJT/2017 ASSTT. YEAR 2014 - 15 2 2. THE ASSESSEE VIDE LETTER DATED 16 JULY 2019 HAS FILED FRESH GROUNDS OF APPEAL WHICH ARE REPRODUCED AS UNDER: 1. APPELLANT TRUST WAS ESTABLISHED IN 1965 AND OBTAINED REGISTRATION U/S.12A OF THE INCOME TAX 1961 VIDE REGISTRATION NO.65/G - 37/74 - 75/C.I.T V DATED 4 TH APRIL 1976 AHMEDABAD BUT PRESENT TRUSTEE COULD NOT PRODUCE BEFORE THE LEARNED ITO (EXEMPTIONS) RAJKOT DURING THE ASSESSME NT PROCEEDING FOR ASST. YEAR 2014 - 15 AS IT WAS MISPLACED IN VERY OLD FILE. 2. APPELLANT RE - APPLIED TO C.I.T (EXEMPTIONS) AHMEDABAD REQUESTING TO ISSUE NEW CERTIFICATE AS 12A/12AA WITH ALL DOCUMENTS HON. CIT (EXEMPTION) ISSUED CERTIFICATE ON 26 TH DECEMBER, 20 16 WITH EFFECTIVE FROM ASST. YEAR 2017 - 18 F.Y. 2016 - 17 ''LD.AO''. I.T.O DID NOT ACCEPTED AND DISALLOWED BENEFIT US 11 TO 13 OF ACT AND TAX ON INCOME. 3. AGGRIEVED TRUST FILED APPEAL BEFORE HON. CIT(A) 3 RAJKOT TO ALLOW APPEAL ON THE GROUNDS OF NEW CERTIFICATES U/S 12AA DATED 26THDEC. 2016 TO GIVE RETROSPECTIVE EFFECT BUT IN MISTAKE A.R. S CLERK ATTACHED CERTIFICATE U/S.12AA OF ANOTHER TRUST HAVING SAME NAM E I.E GUJARATI MACHHU KATHIA DARJI GYANTI TRUST OF GONDAL CITY OF WHOM A.R. CHARTERED ACCOUNTANT IS AUDITOR OF GONDAL TRUST. THE HON. CIT (A) 3 RAJKOT REJECTED APPEAL DUE TO WRONG FILLING OF 12AA OF ANOTHER TRUST. HENCE APPEAL IS FILED TO I.T.A.T 3. THE LEARNED AR BEFORE US SUBMITTED THAT THE FRESH GROUND S OF APPEAL RAISED BY THE ASSESSEE GO TO THE ROOT OF THE MATTER. THUS HE PRAYED FOR THE ADMISSION OF THE FRESH GROUNDS OF APPEAL. ON THE CONTRARY THE LEARNED DR ALSO NOT OBJECTED ON THE ADMISSION OF THE F RESH GROUNDS OF APPEAL RAISED BY THE ASSESSEE. ADMITTEDLY, THE FRESH GROUNDS OF APPEAL HAVE BEARING ON THE CASE ON HAND AND ALL THE FACTS RELATED TO THE ISSUES RAISED IN THE FRESH GROUNDS OF APPEAL ARE EMANATING FROM THE ORDER OF THE AUTHORITIES BELOW. ACC ORDINGLY, WE ADMIT THE SAME AND PROCEED TO ADJUDICATE THE ISSUE RAISED BY THE ASSESSEE. 4. THE ONLY EFFECTIVE ISSUE RAISED BY THE ASSESSEE IS THAT THE LEARNED CIT (A) ERRED IN CONFIRMING THE ORDER OF THE AO BY DENYING THE EXEMPTION UNDER SECTION 11 OF THE ACT. 5. THE FACTS IN BRIEF ARE THAT THE ASSESSEE IS A PUBLIC CHARITABLE TRUST AND REGISTERED WITH THE CHARITY COMMISSIONER UNDER THE BOMBAY P UBLIC T RUST ACT 1950. THE ASSESSEE IS ENGAGED IN THE ACTIVITY OF PROMOTING THE BRIGHT STUDENTS AND IT IS ALSO RU NNING TWO COMMUNITY HALLS. THE ASSESSEE FILED THE RETURN OF ITA NO.413 /RJT/2017 ASSTT. YEAR 2014 - 15 3 INCOME DECLARING TOTAL INCOME AT RS. NIL AFTER CLAIMING EXEMPTION UNDER SECTION 11 OF THE ACT. HOWEVER THE ASSESSEE DURING THE ASSESSMENT PROCEEDINGS FAILED TO PRODUCE THE REGISTRATION CERTIFICATE GRANTED UNDER SECTION 12A OF THE ACT WHICH WAS NECESSARY FOR CLAIMING THE EXEMPTION UNDER SECTION 11 OF THE ACT. 5.1 THUS THE AO, IN THE ABSENCE OF CERTIFICATE UNDER SECTION 12A OF THE ACT, TREATED THE ASSESSEE AS AOP AND DENIED THE EXEMPTION CLAIMED BY THE ASSESSEE UNDER SECTION 11 OF THE ACT. HENCE, THE AO FRAME THE ASSESSMENT AT THE TOTAL INCOME OF 14,08,457.00 IN THE HANDS OF THE ASSESSEE. 6. AGGRIEVED ASSESSEE PREFERRED AN APPEAL TO THE LEARNED CIT (A) WHO ALSO CONFIRMED THE ORDER OF THE AO. B EING AGGRIEVED BY THE ORDER OF THE LEARNED CIT (A) THE ASSESSEE IS IN APPEAL BEFORE US. 7. THE LEARNED AR BEFORE US FILED A PAPER BOOK RUNNING FROM PAGES 1 TO 87 AND SUBMITTED AS UNDER: (1) THE ORIGINAL OF COPY OF REGISTRATION CERTIFICATE U/S 12A WAS MISPLACED BY PREVIOUS TRUSTEE NOT FOUND AFTER MANY EFFORTS, HENCE THE TRUST RE - APPLIED FOR REGISTRATION U/S I 12AA WITH HON. C.I.T (EXEMPTION) AHMADABAD. (2) THE OFFICE OF HON.C.I.T(EXEMPTION) DELAYED ABOUT 7 TO 8 MONTHS IN ISSUING THE CERTIFICATE (AS ORIGINAL) APPLICATION WAS MISPLACED IN OFFICE OF HON.C.I.T A'BAD THEY CALLED FOR EXTRA COPY OF APPLICATION SET ON TELEPHONE TO AR OF TRUST C.A. (3) THE TRUST PRODUCED THE NEW CERTIFICATE BEFORE THE I.T.O. WARD (EXEMPTION) RAJKOT BUT IT WAS EFFECTIVE FROM F.Y. 2016 - 2017 HENCE ID I.T.O DID NOT ACCEPTED IT AND DID NOT GIVEN | RETROSPECTIVE BENEFIT U/S 11 TO 13 OF INCOME TAX 1961 AND MADE ADDITION OF RS. 3,29. 4QO/ IN THE ASSESSMENT ORDER OF A.Y. 2014 - 2015 ( F.Y. 2013 - 14) & TAXED ON IT (4) THE AGGRIEVED TRUST FILED APPEAL BEFORE CIT (APPEAL) RAJKOT, BUT IN MISTAKE CERTIFICATE US 12AA OF SAME NAME TRUST ' GUAJARATI MACHHU KATHIA DARJI GYANTI TRUST' OF GONDAL WHICH HON. C.I.T.(A) DISALLOWED THE APPEALDUE TO WRONG FILING OF 12AA CERTIFICATE HENCE THE TRUST HAVE TO APPROACH IT AT (RAJKOT BRANCH) RECENTLY THE NEW INCOMING CHAIRMAN OF THE TRUST FOUND THE ORIGINAL CERTIFICATE U/S 12A (5) RECENTLY THE NEW INCOMING CHAIRMAN OF THE TRUST FOUND THE ORIGINAL CERTIFICATE U/S.12A DATED 2 ND APRIL 1976 C ERTIFICATE REGISTRATIONS NO 6S/G - 37/74 - 75/C.I.T - V - AHMEDABAD FROM THEIR OLD FILES RECORDS. ITA NO.413 /RJT/2017 ASSTT. YEAR 2014 - 15 4 (6) SINCE THE TRUST HAD OBTAINED REGISTRATION U/S.12A SINCE 2 ND APRIL, 1976 THE DISALLOWANCE OF BENEFIT U/S.12A BY THE LD I.T.O (EXEMPTION) RAJKOT F.Y. 2013 - 14 ASST. YEAR 2014 - 15 IN A.Y. 2014 - 15 AND ADDITION IN INCOME IS DISALLOWABLE. (7) ACCORDINGLY THE PENALTY U/S.270(1)(A) CAN BE DISMISSED. PRAY TO HON BLE I.T.A.T 1. THE TRUST WAS ALREADY REGISTERED U/D 12A ON 2 APRIL 1976 THE BENEFIT A/S 11 TO 13 OF THE INCOME TAX ACT 1976 SHOULD BE ALLOWED, FROM THE FINANCE YEAR OF ISSUE I.E. 1976 THE CERTIFICATE U/S 12AA IS NOT REJECTED BY CIT/CIT (EXEMPTION) TILL TODAY. 2. PENALTY PROCEEDING A/S 271 (L)(C) IN INCITED BY THE LEARNED I.T.O(EXEMPTION) WARD 1 RAJKOT SHOULD BE DROPPED 8. ON THE OTHER HAND, THE LEARNED DR VEHEMENTLY SUPPORTED THE ORDER OF THE AUTHORITIES BELOW. 9. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PARTIES AND PERUSED THE MATERIALS AVAILABLE ON RECORD. I N THE CASE ON HAND THE ASSESSEE CLAIMED THE EXEMPTION UNDER SECTION 11 OF THE ACT WHICH WAS DENIED BY THE AUTHORITIES BELOW ON THE GROUND THAT THE ASSES SEE FAILED TO PRODUCE THE CERTIFICATE ISSUED UNDER SECTION 12A OF THE ACT. IN THIS REGARD THE LEARNED AR FOR THE ASSESSEE SUBMITTED BEFORE US THAT THE CERTIFICATE UNDER SECTION 12A OF THE ACT WAS NOT TRACEABLE /MISPLACED. THEREFORE THE SAME WAS NOT PRODUCE D BEFORE THE AUTHORITIES BELOW. HOWEVER, THE SAME IS AVAILABLE NOW. THE LEARNED AR ALSO FILED THE COPY OF THE CERTIFICATE ISSUED UNDER SECTION 12A OF THE ACT WHICH IS AVAILABLE ON RECORD. 9.1 ADMITTEDLY, THE CERTIFICATE ISSUED UNDER SECTION 12A OF THE AC T WAS NOT AVAILABLE BEFORE THE AUTHORITIES BELOW AT THE TIME OF PROCEEDINGS BEFORE THEM. HOWEVER, THE SAME WAS FILED BEFORE US WHICH IS NOW PLACED ON RECORD. THE ENTIRE CONTROVERSY RELATES TO THE NON - AVAILABILITY OF CERTIFICATE ISSUED UNDER SECTION 12A OF THE ACT BEFORE THE AUTHORITIES BELOW. AS CERTIFICATE IS AVAILABLE ITA NO.413 /RJT/2017 ASSTT. YEAR 2014 - 15 5 NOW, ACCORDINGLY WE, IN THE INTEREST OF JUSTICE AND FAIR PLAY, ARE INCLINED TO REFER THE MATTER TO THE AO FOR FRESH ADJUDICATION AFTER CONSIDERING THE CERTIFICATE ISSUED TO THE ASSESSEE UNDE R SECTION 12A OF THE ACT AND AS PER THE PROVISIONS OF LAW. HENCE THE GROUND OF APPEAL OF THE ASSESSEE IS ALLOWED FOR THE STATISTICAL PURPOSES. 10. IN THE RESULT, FOR THE STATISTICAL PURPOSES, THE APPEAL OF THE ASSESSEE IS ALLOWED. O RDER PRONOUNCED IN THE COURT ON 10 /12 / 2019 AT AHMEDABAD. - SD - - SD - (MS MADHUMITA ROY ) (WASEEM AHMED ) JUDICIAL MEMBER ACCOUNTANT MEMBER (TRUE COPY) A HMEDABAD; DATED 10 / 12 /2019 MANISH