The Income Tax Officer (Exemptions), V. Guru Harkrishan Public School, Kapurthala

ITA 423/ASR/2016

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 8785 (ITAT-AMRITSAR)
• Duration Of Justice: 5 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-01-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 16-01-2017
• Assessment Year: 2011-2012
• Appeal Filed On: 16-08-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: BHAWANI SHANKAR; ALLOWING ITS CLAIM EXEMPTION US
• Keywords: Charitable institution; Benefit of exemption; Condonation of delay
• Section: 32; 147; 131; 68; 246; 69; 145; 27; 148; 54; 37; 6; 56; 263; 63; 132; 12; 28; 144; 10; 90; 154; 2; 11; 15; 271(1)(b); 139; 92; 12A; 12AA; 10B; 143(2); 13; 22; 10(23C)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH; AMRITSAR (CAMP AT JALANDH AR ) BEFORE SH. A.D.JAIN, JUDICIAL MEMBER AND SH. T.S. KAPOOR, ACCOUNTANT MEMBER I.T.A NO. 422 (ASR)/2016 ASSESSMENT YEAR:2011-12 ITO (EXEMPTION) WARD, JALANDHAR VS. GURU HARKRISHAN PUBLIC SCHOOL, OPP. RAIL COACH FACTORY, KAPURTHALA. PAN: AAITS-2981C (APPELLANT) (RESPONDENT) CROSS OBJECTION NO. 19 (ASR)/2016 ARISING OUT OF ITA NO.422(ASR)/2016 ASSESSMENT YEAR: 2011-12 GURU HARKRISHAN PUBLIC SCHOOL, OPP. RAIL COACH FACTORY, KAPURTHALA. PAN: AAITS-2981C VS. ITO (EXEMPTION) WARD, JALANDHAR (CROSS OBJECTOR ) (RESPONDENT) I.T.A NO. 423 (ASR)/2016 ASSESSMENT YEAR: 2011-12 ITO (EXEMPTION) WARD, JALANDHAR VS. GURU HARKRISHAN PUBLIC SCHOOL, SULTANPUR LODHI, KAPURTHALA. PAN: AABAS-2513A (APPELLANT ) (RESPONDENT) CROSS OBJECTION NO. 20(ASR)/2016 ARISING OUT OF ITA NO.423(ASR)/2016 ASSESSMENT YEAR: 2011-12 GURU HARKRISHAN PUBLIC SCHOOL, SULTANPUR LODHI, KAPURTHAL. PAN: AABAS-2513A VS. ITO (EXEMPTION) WARD, JALANDHAR (CROSS OBJECTOR ) (RESPONDENT) ITA NOS.4 22 & 423 (ASR)/2016 C.O.NOS. 19 & 20 (ASR)/2016 ASST. YEAR: 2011-12 2 APPELLANT BY: SH. SURINDER MAHAJAN(CA .) RESPONDENT BY: SH. BHAWANI SHANKAR (DR) DATE OF HEARING: 16.01. 2017 DATE OF PRONOUNCEMENT: 18.01.2017 ORDER PER T. S. KAPOOR (AM): THESE ARE TWO APPEALS FILED BY REVENUE AGAINST THE SEPARATE ORDERS OF LD. CIT(A), JALANDHAR, BOTH DATED 08.04.2016, FOR ASST. YEAR: 2011-12. THE ASSESSES HAVE ALSO PREFERRED CROSS OBJECTIONS TO THE APPEALS FILED B Y THE REVENUE. 2. THE REVENUE AS WELL AS ASSESSEE HAS TAKEN FOLLOWING COMMON GROUNDS OF APPEALS AND CROSS OBJECTIONS. GROUNDS OF APPEAL IN ITA NO.422(ASR)/2016 (I) THAT THE ASSESSEE SOCIETY U/S 12AA(I)(B)(I) BY THE COMMISSIONER OF INCOME TAX DATED 25.09.2012 WITH EFFECT FROM 01.04. 20111 I.E. FROM ASSESSMENT YEAR 2012-13 AND SUBSEQUENT YEARS. THUS ASSESSEE'S CLAIM FOR EXEMPTION OF INCOME U/S 11 & 1 2 OF INCOME TAX ACT, 1961 IS NOT SUSTAINABLE, THERE BEING NO RE GISTRATION U/S 12AA OF THE I.T. ACT 1961 FOR THE YEAR UNDER CONSID ERATION. (II) THAT THE ANNUAL RECEIPTS OF THE ASSESSEE AS PE R INCOME & EXPENDITURE ACCOUNT, AUDIT REPORT IN FORM NO 10B AN D BOOKS OF ACCOUNT ARE OF RS. 1,06,01,567/- AND CLAIM OF EXEMP TION U/S 10(23C)(IIIAD) IS THEREFORE ALSO NOT ALLOWABLE. IT IS THE AFTERTHOUGHT OF THE ASSESSEE SOCIETY TO EVADE TAX. (III) THAT THE ASSESSEE TRUST EARNING PROFITS FROM RUNNING BOOK SHOP, EARNING BANK INTEREST AND CANTEEN RENT ETC. THAT CA PITAL ASSETS HAVE BEEN PURCHASED OF SURPLUS WHICH ALSO AMOUNTS TO UTI LIZATION FOR CHARITABLE PURPOSES, BUT THE SURPLUS HAS TO BE MAIN TAINED AS REASONABLE WITHIN THE RANGE OF 6% TO 15% AS PER THE OBSERVATIONS OF SHRI SINHA HON'BLE JUDGE OF THE SUPREME COURT (IN T HE CASE OF P A ANDAR AND OTHER V/S STATE OF MAHARASHTRA (2005)/6 S CC 537). TO EARN SURPLUSES OF THE RANGES OF 39%, 37% AND 29% CLEARLY ITA NOS.4 22 & 423 (ASR)/2016 C.O.NOS. 19 & 20 (ASR)/2016 ASST. YEAR: 2011-12 3 MANIFESTS A HIGH PROFIT MOTIVE WHICH NOT SHOWS THE CHARITABLE ACTIVITIES OF THE ASSESSEE TRUST. GROUNDS OF CROSS OBJECTIONS NO.19(ASR)/2016 (I) THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE, LE ARNED COMMISSIONER OF INCOME-TAX(APPEALS)-2, JALANDHAR, H AS RIGHTLY HELD THAT INCOME OF THE ASSESSEE TRUST IS EXEMPT U/S 11/ 12 OF THE ACT SINCE AT THE TIME OF REGISTRATION U/S 12AA OF THE ACT, AS SESSMENT PROCEEDINGS FOR THE YEAR UNDER CONSIDERATION WERE PENDING BEFOR E THE LEARNED ASSESSING OFFICER. (II) THAT LEARNED CIT(A) IN PARA 8 PAGE 25 OF THE APPELL ANT ORDER HAS HELD THAT SINCE ASSESSEE TRUST IS ENTITLED FOR EXEMPTION U/S 11/12 OF THE ACT, IT IS NOT CONSIDERED NECESSARY TO ADJUDICATE ON GRO UNDS OF APPEAL NO.2,3,4,5 & 6. GROUNDS OF APPEAL NOT ADJUDICATE BY THE LEARNED CIT(A) AS DETAILED BELOW BE ADJUDICATED. 3. THE APPEALS WHERE HEARD TOGETHER, THEREFORE, FOR THE SAKE OF CONVENIENCE, A COMMON AND CONSOLIDATED ORDER IS BEING PASSED. 4. THE LD. DR, AT THE OUTSET, SUBMITTED THAT THE CIT(A) HA S WRONGLY ALLOWED RELIEF TO THE ASSESSEE BY ALLOWING ITS CLAIM FOR EXEMPTION U/S 11 /12 OF THE INCOME TAX ACT, AS REGISTRATION GRANTED TO THE ASSESSEE U /S 12AA WAS FOR ASST. YEAR 2012-13 AND SUBSEQUENT YEARS AND D URING THIS YEAR I.E., ASST. YEAR 2011-12, THE ASSESSEES WERE NOT HAVING REGISTR ATION U/S 12AA OF THE ACT. THE LD. DR FURTHER SUBMITTED THAT EXEM PTION U/S 10(23C) (IIIAD) WAS ALSO NOT ALLOWABLE TO THE ASSESSEES. 5. THE LD. AR, ON THE OTHER HAND, SUBMITTED THAT ASSESSES WERE N O DOUBT GRANTED EXEMPTION VIDE ORDER DATED 25.09.2012, HOWEVER, THE ASSESSES WERE ELIGIBLE FOR EXEMPTION FOR THE PRESENT YEARS ALSO AS THE ASSESSMENT FOR THESE YEARS WAS PENDING BEFORE THE ASSESSING OFFICER AND IN VIEW OF THE AMENDED PROVISIONS OF SEC.12A OF THE ACT W.E.F. 1.10.2014, ITA NOS.4 22 & 423 (ASR)/2016 C.O.NOS. 19 & 20 (ASR)/2016 ASST. YEAR: 2011-12 4 THESE WERE APPLICABLE IN THE CASE OF ASSESSEES ALSO. THE LD. AR SUBMIT TED THAT DETAILED SUBMISSIONS WERE MADE TO LD. CIT(A) AND AN ADD ITIONAL GROUND WAS TAKEN TO CONSIDER AS TO WHETHER THE AMENDMENT BROUGH T IN SEC.12A BY FINANCE ACT 2014 WERE APPLICABLE TO THE YEAR UNDER CONSIDERATION OR NOT AND THE LD. CIT(A) RELYING ON THE CASE LAWS OF ALLIED MOTORS (P.) LTD. VS. CIT 224 ITR 0677(SC) AND FURTHER JURIDICAL PRONOUNCEMENTS HAS HELD THAT THE AMENDMENT BROUGHT BY FINANCE ACT, 2014 WAS NOT RETROSPECTIVE IN NATURE AND THEREFORE, APPLICABLE TO THE ASSESSEE COMPANY. 6. AS REGARDS CROSS OBJECTIONS FILED BY THE ASSESSEE, THE LD. AR SUBMITTED THAT THE LD. CIT(A) HAD NOT ADJUDICATED ON THE GROUNDS TAKEN BY ASSESSEE FOR ALLOWING EXEMPTION U/S 10(23C)(IIIAD) OF THE A CT, THEREFORE, THE ASSESSEES HAS PREFERRED THESE GROUNDS AS CROSS OBJECTIONS TO THE APPEALS FILED BY REVENUE. 7. THE LD. DR, ON THE OTHER HAND, RELIED ON THE ORDER OF A UTHORITIES BELOW. 8. WE HAVE HEARD THE RIVAL PARTIES AND HAVE GONE THROUGH THE MATERIAL PLACED ON RECORD. WE FIND THAT ASSESSES WERE RUNNING SCHOOLS IN DISTRICT KAPURTHALA AND HAD FILED RETURNS OF INCOME DECLARI NG TOTAL NIL INCOME AFTER CLAIMING EXEMPTION U/S 11/12 OF THE ACT. DURING HE ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER REQUIRED THE ASSESSEES TO EXPLAIN AS TO WHY EXEMPTION CLAIMED BY ASSESSEES SHOULD NOT BE ITA NOS.4 22 & 423 (ASR)/2016 C.O.NOS. 19 & 20 (ASR)/2016 ASST. YEAR: 2011-12 5 DISALLOWED AS IT WAS NOT REGISTERED U/S 12A/12AA OF THE ACT. IN RESPONSE THERETO THE ASSESSEES SUBMITTED THAT EXEMPTION TO THE TRUST BE ALL OWED U/S 10(23C)(IIIAD) OF THE ACT, ON THE GROUND THAT ASSESSEE TRU STS WERE RUNNING AS AN EDUCATIONAL INSTITUTIONS AS SUCH IT WAS ENTITLED FOR EXEMPTION OF INCOME UNDER THIS SECTION AS THE RECEIPTS OF THE ASSESEES WERE LESS THAN RS.1,00,000,00/. HOWEVER, THE ASSESSING OFFICER REJECTED THE CLAIM OF ASSESSEE U/S 10(23C)(IIIAD) OF THE ACT ON THE GROUN D THAT ASSESSEE HAD NOT MADE SUCH CLAIM WHILE FILING RETURNS OF INCOME. THE CLAIM OF SUCH EXEMPTION WAS ALSO REJECTED AS THE ASSESSING OFFICER HELD THAT APPLICATION FILED BY ASSESSEE FOR SUBSEQUENT YEARS FOR CLAIM O F EXEMPTION U/S 10(23C)(IIIAD) OF THE ACT WAS REJECTED BY THE COMMISSIONER OF INCOME TAX ACT. THE ASSESSING OFFICER FURTHER HELD THAT RECEIPT S OF THE ASSESSEE TRUSTS DURING THE YEAR UNDER CONSIDERATION EXCEEDED RS.1,00,000,00/-. THEREFORE, IN VIEW OF THESE FACTS AND CIRCUMST ANCES, THE ASSESSING OFFICER HELD THAT THE CLAIM OF THE ASSESSEE U/S 11/12 A ND U/S 10(23C)(VII) OF THE ACT WAS NOT TENABLE. 9. AGGRIEVED THE ASSESSEE FILED APPEALS BEFORE LD. CIT(A) AND SUBMITTED VARIOUS SUBMISSIONS. THE ASSESSEES ALSO FILED ADDITIONAL GROUNDS OF APPEAL, WHICH IS REPRODUCED HEREIN BELOW. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE, A SSESSEE HAS TO EXEMPTION UNDER SECTION 11 OF THE ACT BECAUSE OF AM ENDMENT BROUGHT IN SECTION 12A BY FINANCE ACT 2014 W.E.F.01.10.2014 BY WAY OF INSERTION OF FIRST PROVISO TO SECTION 12A(2) OF THE ACT WHICH RE ADS AS UNDER: PROVIDED THAT WHERE REGISTRATION HAS BEEN GRANTED TO THE TRUST OR INSTITUTION UNDER SECTION 12AA, THEN, THE PROVISION S OF SECTIONS 11 & 12 ITA NOS.4 22 & 423 (ASR)/2016 C.O.NOS. 19 & 20 (ASR)/2016 ASST. YEAR: 2011-12 6 SHALL APPLY IN RESPECT OF ANY INCOME DERIVED FROM P ROPERTY HELD UNDER TRUST OF ANY ASSESSMENT YEAR PRECEDING THE AFORESAID ASSE SSMENT YEAR, FOR WHICH ASSESSMENT PROCEEDINGS ARE PENDING BEFORE TH E ASSESSING OFFICER AS ON THE DATE OF SUCH REGISTRATION AND THE OBJECTS AND ACTIVITIES OF SUCH TRUST OR INSTITUTION REMAIN THE SAME FOR SUCH PRECE DING ASSESSMENT YEAR: THE LD. CIT(A) ADJUDICATED ON THE ADDITIONAL GROUNDS OF A PPEAL AND HELD THAT ASSESSES WERE ELIGIBLE FOR EXEMPTION U/S 11/12 OF THE ACT. H E HOWEVER DID NOT ADJUDICATE ON THE OTHER GROUNDS OF APPEAL WHI CH INCLUDED THE CLAIM OF ASSESSEE U/S 10(23C)(IIIAD) OF THE ACT. THE LD. CIT(A) IN THIS RESPECT HELD THAT SINCE THE ASSESSES WERE HELD TO BE ENTIT LED FOR EXEMPTION U/S 11/12 OF THE ACT, THEREFORE, HE DID NOT CO NSIDER NECESSARY TO ADJUDICATE ON THE CLAIM OF THE ASSESSEE U/S 10(23C) (I IAD) OF THE ACT. 10. AGGRIEVED BOTH PARTIES ARE IN APPEAL BEFORE US. 11. THE REVENUE IS IN APPEAL AGAINST THE ACTION OF LD. CIT(A ) BY WHICH HE HAD ALLOWED EXEMPTION U/S 11&12 OF THE ACT, WHEREAS ASSESSEE HAS FILED CROSS OBJECTIONS AGAINST THE ORDER OF CIT(A) ON THE GROU ND THAT LD. CIT(A) HAS NOT ADJUDICATED ON GROUNDS RELATING TO EXEMPTI ON U/S 10(23C)(IIIAD) OF THE ACT. WE FIND THAT LD. CIT(A) HAS P ASSED SIMILAR ORDERS IN TWO APPEALS AND WHEREBY HE HAS DECIDED THE ADDITIONAL GROUNDS OF APPEAL IN FAVOUR OF ASSESSEE AND HAS HELD THAT ASSESSEES WER E ENTITLED FOR EXEMPTION U/S 11/12 OF THE ACT AS AMENDMENT BR OUGHT IN BY THE FINANCE ACT, 2014 WAS RETROSPECTIVE IN NATURE BECAUSE THE ASSESSMENTS WERE PENDING BEFORE THE ASSESSING OFFICER. IT IS AN ITA NOS.4 22 & 423 (ASR)/2016 C.O.NOS. 19 & 20 (ASR)/2016 ASST. YEAR: 2011-12 7 UNDISPUTED FACT THAT ASSESSMENTS IN THESE CASES WERE PENDING BEFORE THE ASSESSING OFFICER ON THE DATE OF REGISTRATION OF TRUST I.E., 25.09 .2012 AS IS APPARENT FROM THE FOLLOWING CHARTS. SR. NO. PARTICULARS DATE 1. APPLICATION UNDER SECTION 12A(A) OF THE ACT FILED B EFORE C.I.T., JALANDHAR-II, JALANDHAR 30.03.2012 2. RETURN FOR A.Y. 2011-12 FILED WITH INCOME TAX DEPT. 29.09.201 3. CASE FOR A.Y. 2011 - 12 SELECTED FOR SCRUTINY & NOTICE UNDER SECTION 143(2) OF THE ACT ISSUED 25.09.2012 4. ORDER UNDER SECTION 12AA(L)(B)(I) OF THE ACT PASSED BY C.I.T., JALANDHAR-II, JALANDHAR 25.09.2012 5. ASSESSMENT FOR THE A.Y. 2011 - 12 COMPLETED BY DY. C.I.T., CIRCLE-IV, JALANDHAR 28.03.2014 WE FURTHER FIND THAT CBDT VIDE CIRCULAR NO.01/2015, DATED 21.01.2015 HAS ISSUED EXPLANATORY NOTES TO PROVISIONS OF FI NANCE ACT (NO.2) FINANCE ACT, 2014 WHICH ARE REPRODUCED BELOW. 8. APPLICABILITY OF THE REGISTRATION GRANTED TO A TRUST OR INSTITUTION TO E ARLIER YEARS 8.1 THE PROVISIONS OF SECTION 12A OF THE INCOME-TAX ACT , BEFORE AMENDMENT BY THE ACT, PROVIDED THAT A TRUST OR AN INSTITUTION CAN CLAIM EXEMPTION UNDER SE CTIONS 11 AND 12 ONLY AFTER REGISTRATION UNDER SECTION 12AA OF THE SAID ACT HAS BEEN GRANT ED. IN CASE OF TRUSTS OR INSTITUTIONS WHICH APPLY FOR REGISTRATION AFTER 1ST JUNE, 20 07, THE REGISTRATION SHALL BE EFFECTIVE ONLY PROSPECTIVELY. 8.2 NON-APPLICATION OF REGISTRATION FOR THE PERIOD PRIOR TO THE YEAR OF REGISTRATION CAUSED GENUINE HARDSHIP TO CHARITABLE ORGANIZATIONS. DUE TO ABSENCE OF REGISTRATION, TAX LIABILITY IS FASTENED EVEN THOUGH THEY MAY OTHERWISE BE ELIGIBLE FOR EX EMPTION AND FULFILL OTHER SUBSTANTIVE CONDITIONS. HOWEVER, THE POWER OF CONDONATION OF DELAY IN SEEKIN G REGISTRATION WAS NOT AVAILABLE. 8.3. IN ORDER TO PROVIDE RELIEF TO SUCH TRUSTS AND REMOVE HARDSHIP IN GENUINE CASES, SECTION 12A OF THE INCOME-TAX ACT HAS BEEN AMENDED TO PROVIDE THAT IN A CASE WHERE A \ TRUST OR INSTITUTION HAS BEEN GRANTED REGISTRATION UNDER SECTION 1 2AA OF THE INCOME-TAX ACT, THE BENEFIT OF SECTIONS 11 AND 12 OF THE SAID ACT SHALL BE AVAILABL E IN RESPECT OF ANY ITA NOS.4 22 & 423 (ASR)/2016 C.O.NOS. 19 & 20 (ASR)/2016 ASST. YEAR: 2011-12 8 INCOME DERIVED FROM PROPERTY HELD UNDER TRUST IN ANY ASSESSMENT PR OCEEDING FOR AN 1 EARLIER ASSESSMENT YEAR WHICH IS PENDING BEFORE THE ASSESSING OFFICER AS ON THE DATE OF SUCH REGISTRATION, IF THE OBJECTS AND ACTIVITIES OF SUCH TRUST OR INSTITUTION IN THE RE EARLIER ASSESSMENT YEAR ARE THE SAME AS THOSE ON THE BASIS OF WHICH SUCH REGIS TRATION BEEN GRANTED. 8.4. FURTHER, IT HAS BEEN PROVIDED THAT NO ACTION FOR REOPENING OF AN ASSES SMENT SECTION 147 OF THE INCOME-TAX ACT SHALL BE TAKEN BY THE ASSESSING OFFICER IN THE C. SUCH TRUST OR INSTITUTION FOR ANY ASSESSMENT YEAR PRECEDING THE FIRST ASSESSMENT YEAR WHICH THE REGISTRATION APPLIES, MERELY FOR THE REASON THAT SUCH TRUST OR INST ITUTION HAS OBTAINED THE REGISTRATION UNDER SECTION 12AA FOR THE SAID ASSESSMENT YEAR. 8.5..HOWEVER, THE ABOVE BENEFITS WOULD NOT BE AVAILABLE IN THE CASE OF ANY TRUST INSTITUTION WHICH AT ANY TIME HAD APPLIED FOR REGISTRATION AND THE SAME WAS REFUSED UNDER SECTION 12AA OF THE INCOME-TAX ACT OR A REGISTRATION ONCE GRANTED WAS CANCELLE D. APPLICABILITY: - THESE AMENDMENTS TAKE EFFECT FROM F' OCTOBER, 2014. WE FURTHER FIND THAT THE AMENDMENT IN SEC.12A(2) OF THE ACT WERE BROUGHT IN THE STATUTE WITH A VIEW TO GRANT TAX BENEFIT TO GENUINE CHARITABLE TRUST AND SOCIETIES CARRYING ON GENUINE CHARITABLE OBJ ECTS IN THE EARLIER YEARS AND WHICH WERE FULFILLING SUBSTANTIVE CONDITION S STIPULATED IN SEC.11 TO 13 OF THE ACT. THE HONBLE ITAT KO LKATA BENCH IN THE CASE OF SREE SREE RAMKRISHNA SAMITY VS. DCIT VIDE ORDER DATED 09.10.2015 HAS HELD THAT C) INSERTION OF PROVISIONS, THE PROVISO TO SEC.12A (2) OF THE ACT HAS TO BE CONSTRUED AS RETROSPECTIVE IN OPERATION. WE HOLD THAT SINCE THE ONLY REASON FOR DENIAL OF E XEMPTION U/S 11 WAS ABSENCE OF REGISTRATION U/S 12AA (WHICH WAS GRANTED TO ASSESSEE SOCIETY ON 29.10.2010 WITH EFFECT FROM 1.4.2010) FOR THE RE LEVANT ASSESSMENT YEARS AND ON NO OTHER GROUND, THE BENEFIT OF CHANGE IN LAW AS ABOVE BY FINANCE ACT 2014 SHOULD BE AVAILABLE AND FOR ALL TH E YEARS, THE BENEFIT OF EXEMPTION SHOULD BE AVAILABLE ON THE DATE OF REGIST RATION AS ALL THE ASSESSMENTS WERE PENDING AS SHOWN ABOVE. AS THE ASSESSMENTS WERE PENDING ON THE DATE OF REGISTRATION, THE LD. CIT(A) HAS RIGHTLY ALLOWED EXEMPTION U/S 11 OF THE ACT. FO R THE SAKE OF ITA NOS.4 22 & 423 (ASR)/2016 C.O.NOS. 19 & 20 (ASR)/2016 ASST. YEAR: 2011-12 9 COMPLETENESS THE OPERATIVE PART OF THE LD. CIT(A) ORDER IS REPRO DUCED HEREIN BELOW. 6.6 ON CAREFUL CONSIDERATION OF THE SUBMISSIONS OF THE ASSESSEE AND ON THE BASIS OF RELEVANT JUDICIAL PRONOUNCEMENTS RELIE D UPON BY THE ASSESSEE TRUST MORE PARTICULARLY OF THE HONOURABLE ITAT, C-B ENCH, KOLKATA WHICH IS DIRECTLY ON THE ISSUE AND AS THAT I HAVE NOT COME A CROSS ANY JUDICIAL PRONOUNCEMENT WHICH IS CONTRARY TO THAT AS OF TODAY , I AM OF THE VIEW THAT THERE IS A LOT OF FORCE IN THE ARGUMENTS PUT FORTH BY THE LEARNED AR OF THE ASSESSEE. I AM, THEREFORE, IN COMPLETE AGREEMENT WI TH THE ARGUMENTS OF THE LEARNED AR OF THE ASSESSEE THAT THE FIRST PROVISO T O SECTION 12A(2) OF THE ACT IS APPLICABLE TO TRUST/INSTITUTIONS WHICH HAVE BEEN GRANTED REGISTRATION UNDER SECTION 12AA OF THE ACT EVEN PRIOR TO AMENDME NT PROVIDED ASSESSMENTS ARE PENDING IN THEIR CASES AT THE RELEV ANT TIME. I AM ALSO OF THE OPINION THAT THE PROVISIONS OF SECTION 11/12 OF THE ACT SHALL APPLY IN RESPECT OF ANY INCOME DERIVED FROM ANY PROPERTY HEL D UNDER TRUST OF ANY ASSESSMENT YEAR PRECEDING THE AFORESAID ASSESSMENT YEAR FOR WHICH ASSESSMENT PROCEEDINGS ARE PENDING BEFORE THE ASSES SING OFFICER AS ON THE DATE OF SUCH REGISTRATION. I AM ALSO IN AGREEME NT WITH THE ARGUMENTS OF THE LEARNED AR OF THE ASSESSEE TRUST THAT A PROVISO WHICH IS INSERTED TO REMEDY UNINTENDED CONSEQUENCES AND TO MAKE THE PROV ISION WORKABLE, A PROVISO WHICH SUPPLIES AN OBVIOUS OMISSION IN THE S ECTION AND IS REQUIRED TO BE READ INTO THE SECTION TO GIVE THE SECTION A R EASONABLE INTERPRETATION, REQUIRES TO BE TREATED AS RETROSPECTIVE, IN OPERATI ON SO THAT A REASONABLE INTERPRETATION, CAN BE GIVEN TO THE SECTION AS A WH OLE. SO, INSERTION OF FIRST PROVISO TO SECTION 12A(2) OF THE ACT W.E.F. 01.10.2 014 SHOULD BE READ AS A RETROSPECTIVE IN OPERATION W.E.F. THE DATE WHEN THE CONDITION OF ELIGIBILITY FOR EXEMPTION UNDER SECTION 11/12 OF THE ACT AS MEN TIONED IN SECTION 12A OF THE ACT PROVIDED FOR REGISTRATION UNDER SECTION 12A OF THE ACT AS PER CONDITION FOR APPLICABILITY OF SECTION 12A OF THE ACT. THIS ARGUMENT OF THE L EARNED AR OF THE ASSESSEE TRUST ALSO GETS STRENGTHENED FROM THE JUDGMENT OF THE HON OURABLE SUPREME COURT IN THE CASE OF ALLIED MOTORS(P) LTD. ETC. VS. COMMISSIONER OF INCOME TAX (SC), COMMISSIONER OF INCOME TAX VS. SURESH N. GUPTA (SC), CIT VS VATIKA TOWNSHIP P LTD, COMMISSIONER OF INCOME TAX VS . J.H. GOTLA (SC) AND CBDT CIRCULAR NO. 1/2015 DATED 21.01.2015. FURTHERMORE , THE CASE OF SREE SREE RAMKRISHNA SAMITY VS. DCIT (ITAT KOLKATA) DATE D 09.10.2015 QUOTED BY THE LEARNED LD. A.R OF THE ASSESSEE TRUST AS PER WHICH PROVISO TO SECTION 12A(2) OF THE ACT HAS TO BE CONSTRUED RETROSPECTIVE IN OPERATION I S SQUARELY APPLICABLE TO THE CASE OF THE ASSESSEE TRUST. I AM, THEREFORE OF THE CONSIDER ED OPINION THAT THE ASSESSEE IS ENTITLED TO EXEMPTION UNDER SECTION 11 AND 12 OF THE ACT. RES PECTFULLY RELYING UPON THE JUDICIAL PRONOUNCEMENTS OF THE HONOURABLE SUPREME COURT AND ALSO THAT OF THE PLONOURABLE KOLKATA BENCH AS RELIED UPON BY THE LEARNED AR OF THE ASSESSEE TRUST, I AM ITA NOS.4 22 & 423 (ASR)/2016 C.O.NOS. 19 & 20 (ASR)/2016 ASST. YEAR: 2011-12 10 OF THE CONSIDERED OPINION THAT THE INCOME OF THE ASSESSEE TRUST IS EXEMPT UNDER SECTION 11/12 OF THE ACT SINCE AT THE TIME OF REGISTRATION UNDER SECTION 12AA OF THE ACT, THE ASSESSMENT PROCEEDINGS FOR THE YEAR UNDER CONSIDERATION WERE PENDING BEFORE THE ASSESSING OFFICER. THE ASSESSING OFFICER IS, THEREFORE, DIREC TED TO ALLOW EXEMPTION UNDER SECTION 11/12 OF THE ACT TO THE ASSESSEE TRUST. IN THE RESULT, ADDITIONAL GROUND OF APPEAL TAKEN BY THE ASSESSEE IS ALLOWED. WE FIND THAT LD. CIT(A) HAS PASSED A REASONED AND SPEAKING ORDER AND WE DO NOT FIND ANY INFIRMITY IN THE SAME. IN VIEW OF THE ABOVE APPEALS FILED BY REVENUE ARE DISMISSED. 12. AS REGARDS THE CROSS OBJECTIONS FILED BY THE ASSESSEE, WE FIND THA T LD. CIT(A) HAS NOT ADJUDICATED ON THE GROUNDS RAISED BY ASSESSEE WITH REGARD TO EXEMPTION U/S 10(23C)(IIIAD) OF THE ACT AND IN THE ABSENCE OF NON ADJUDICATION BY LD. CIT(A), WE CANNOT ADJUDICATE ON THE GROUNDS TAKEN BY ASSESSEES. THEREFORE, LD. CIT(A) IS DIRECTED TO ADJUDICATE ON THE GROUNDS TAKEN BY ASSESSEE IN GROUND NOS.2 TO 6 OF APPEALS FILED B EFORE HIM. IN VIEW OF THE ABOVE, THE CROSS OBJECTIONS FILED BY ASSESSEE AR E ALLOWED FOR STATISTICAL PURPOSES. 13. IN NUTSHELL, THE APPEALS FILED BY REVENUE ARE DISMISSED AND CR OSS OBJECTIONS FILED BY ASSESSES ARE ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 18.01. 2017. SD/- SD/- (A.D. JAIN) (T. S. KAPOOR) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 18.01.2017. /PK/ PS. COPY OF THE ORDER FORWARDED TO: (1) THE ASSESSEE: (2) THE ITA NOS.4 22 & 423 (ASR)/2016 C.O.NOS. 19 & 20 (ASR)/2016 ASST. YEAR: 2011-12 11 (3) THE CIT(A), (4) THE CIT, (5) THE SR DR, I.T.A.T., TRUE COPY BY ORDER