Shree Taralabalu Jagadguru Education Society, Bengaluru V. Assistant Commissioner Of Income Tax (CPC), Bangalore

ITA 472/BANG/2020

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 2078 (ITAT-BANGALORE)
• Duration Of Justice: 1 year(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-06-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 15-06-2021
• Assessment Year: 2016-2017
• Appeal Filed On: 05-06-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: C. SANDEEP
• Keywords: Charitable institution; Opportunity of being heard; Period of limitation; Condonation of delay; Set aside
• Section: 154; 12AA; 143(1); 201; 139(1); 20

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH : BANGALORE BEFORE SHRI N. V. VASUDEVAN, VICE PRESIDENT AND SHRI B. R. BASKARAN, ACCOUNTANT MEMBER ITA NO. 4 7 2 /BANG/20 20 ASSESSMENT Y EAR : 201 6 - 1 7 SHREE TARALABALU JAGADGURU EDUCATION SOCIETY, GROUND FLOOR, 3 RD MAIN, TARALABALU KENDRA,2 ND BLOCK, R. T. NAGAR, BENGALURU 560 032. PAN : AA AAS 3618 M VS. THE ASSISTANT COMMISSIONER OF INCOME TAX (CPC), BENGALURU. APPELLANT RESPONDENT ASSESSEE BY : SHRI. C. SANDEEP, CA REVENUE BY : SHRI. PRADEEP KUMAR, CIT(DR)(ITAT), BENGALURU DATE OF HEARING : 15 . 0 6 .20 21 DATE OF PRONOUNCEMENT : 18 . 0 6 .20 21 O R D E R PER N. V. VASUDEVAN, VICE PRESIDENT: THIS IS AN APPEAL BY THE ASSESSEE AGAINST THE ORDER OF THE CIT(A)-14, BENGALURU, DATED 28.02.2020, IN RELATION TO ASSESSMENT YEAR 2016-17. 2. THE ASSESSEE IS AN EDUCATIONAL INSTITUTION EXISTING SOLELY FOR EDUCATIONAL PURPOSES AND NOT FOR PROFIT. THE ASSESSEE IS REGISTERED UNDER U/S. 12AA OF INCOME- TAX ACT, 1961 (ACT) VIDE ORDER DATED 23.09.1974. THE ASSESSEE IS ALSO AN APPROVED EDUCATIONAL INSTITUTION U/S. 10(23C)(VI) OF THE ACT VIDE ORDER DATED 09.05.2017 EFFECTIVE FROM AY 2008-09. THE ASSESSEE FILED ITS RETURN OF INCOME ON 03.08.2016 DECLARING THE TOTAL INCOME AS NIL AFTER CLAIMING DEDUCTION OF RS.28,50,00,000/- U/S. 11(2) OF THE ACT. ITA NO.472/BANG/2020 PAGE 2 OF 5 3. THE ASSESSEE RECEIVED AN INTIMATION U/S 143(1) OF THE ACT FROM THE DEPUTY COMMISSIONER OF INCOME TAX (CPC) WHEREIN DEDUCTION OF RS.28,50,00,000/- U/S 11(2) OF THE ACT WAS DENIED AS THE ASSESSEE FAILED TO FURNISH FORM 10 WITH REGARD TO UTILIZATION OF INCOME FOR CHARITABLE PURPOSE, WITHIN THE DUE DATE SPECIFIED U/S 139(1) OF THE ACT. ACCORDING TO THE ASSESSEE, FORM 10 WAS INADVERTENTLY NOT FILED WITHIN DUE DATE. SUBSEQUENTLY, THE FORM 10 WAS FILED ON 05.09.2017. 4. THE ASSESSEE HAD NOT CLAIMED THE EXEMPTION U/S 10(23C)(VI) OF THE ACT SINCE ON THE DATE OF FILING THE RETURN, APPLICATION FOR EXEMPTION U/S.10(23C(VI) OF THE ACT WAS PENDING. THE EXEMPTION WAS GRANTED ON 09.05.2017 WITH EFFECT FROM ASSESSMENT YEAR 2008 - 2009. THE ASSESSEE FILED A RECTIFICATION APPLICATION U/S 154 TO THE INTIMATION U/S 143(1) OF THE ACT ON 30-4-2018, CLAIMING EXEMPTION U/S.10(23C)(VI) OF THE ACT ALONG WITH FORM 10BB DATED 10.04.2018. 5. THE ASSESSEE ALSO FILED AN APPEAL AGAINST THE ORDER U/S 143(1) OF THE ACT BEFORE COMMISSIONER OF INCOME TAX(APPEALS) - 14, BANGALORE (HEREINAFTER REFERRED TO AS THE COMMISSIONER OF INCOME TAX(APPEALS). DURING THE COURSE OF PROCEEDINGS, THE ASSESSEE FILED A LETTER WITH THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) STATING THAT THE ASSESSEE HAS FILED FORM NO. 10 ON 05.09.2017 AND APPLIED FOR RECTIFICATION U/S. 154 OF THE ACT AND THAT THE ASSESSEE HAS ALSO CLAIMED EXEMPTION U/S. 10(23C)(VI) OF THE ACT IN THE RECTIFICATION RETURN OF INCOME FILED AND REQUESTED TO KEEP THE PROCEEDINGS PENDING TILL THE DISPOSAL OF THE APPLICATION. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) PASSED AN ORDER ON 28.02.2020 DENYING THE DEDUCTION CLAIMED U/S 11(2) OF THE ACT ON THE FOLLOWING GROUNDS: A. THE TIME FRAME IN WHICH FORM-10 IS TO BE FILED IS PROVIDED IN RULE 17 OF THE INCOME TAX RULES, 1962 (RULES) WHICH IS FILING OF FORM-10 ITA NO.472/BANG/2020 PAGE 3 OF 5 BEFORE THE DUE DATE OF FILING THE RETURN AND NO PROVISION UNDER THE ACT PROVIDES FOR FILING OF FORM-10 BELATEDLY. B. FILING OF FORM-10 IS NOT A FORMALITY BUT REQUIRED TO BE FILED ON OR BEFORE THE DUE DATE FOR FILING RETURN. FILING OF FORM-10 AFTER THE DUE DATE PRESCRIBED WOULD NOT CURE THE DEFECT. C. NO EXPLANATION WAS MADE ON DELAYED FILING OF FORM-10 AT THE TIME OF HEARING NOR ANY CONDONATION OF DELAY WAS FILED. 6. THE EXEMPTION U/S. 10(23C)(VI) WAS NOT ALLOWED FOR THE REASONS MENTIONED BELOW; A. WITH REGARD TO ALLOWABILITY OF EXEMPTION U/S 10(23)(VI), SINCE CLAIM WAS NOT MADE IN THE RETURN OF INCOME AND FORM 1 OBB WAS NOT FILED. B. THE CLAIM OF EXEMPTION U/S. 10(23C)(VI) WAS SEPARATELY MADE BEFORE THE AO BY FILING RECTIFICATION U/S 154 OF THE ACT IS NOT ALLOWABLE. 7. AGGRIEVED BY THE AFORESAID ORDER, THE ASSESSEE HAS FILED THIS APPEAL BEFORE THE TRIBUNAL. 8. THE IMPUGNED ORDER OF THE CIT(A) WAS COMMUNICATED TO THE ASSESSE ON 10.03.2020 AS THE ASSESSEE HAD TO FILE THE APPEAL WITHIN 60 DAYS FROM 10.03.2020. THE APPEAL WAS HOWEVER FILED ON 05.06.2020. THE REGISTRY HAS RAISED AN ISSUE WITH REGARD TO THE APPEAL BEING TIME BARRED BY 27 DAYS. WE, HOWEVER, FIND THAT THE HONBLE SUPREME COURT IN SUO MOTO WP NO.3/2020 (CIVIL) BY AN ORDER DATED 23.03.2020 HAS EXTENDED THE PERIOD OF LIMITATION FOR FILING PETITIONS, APPLICATIONS, ETC., UNTIL FURTHER ORDERS. IN VIEW OF THE AFORESAID ORDER OF THE SUPREME COURT PASSED IN THE LIGHT OF THE COVID 19 PANDEMIC SITUATION, WE ARE OF THE VIEW THAT THERE IS NO DELAY IN FILING THE APPEAL. ITA NO.472/BANG/2020 PAGE 4 OF 5 9. AS FAR AS THE MERITS OF THE APPEAL IS CONCERNED, WE FIND THAT THE CIT(A) HAS PASSED AN EX-PARTE ORDER. THE REQUEST OF THE ASSESSEE FOR ADJOURNMENT WAS MADE ON THE GROUND THAT THE ASSESSEE HAS FILED APPLICATION UNDER SECTION 154 OF THE INCOME TAX ACT, 1961 (HEREINAFTER CALLED THE ACT), BEFORE THE AO. IN OUR VIEW, THE PROCEEDINGS BEFORE THE AO U/S.154 OF THE ACT, HAD A MATERIAL BEARING BEFORE THE APPEAL CAN BE TAKEN UP BY THE CIT(A). IN THOSE CIRCUMSTANCES, THE REQUEST FOR ADJOURNMENT OUGHT TO HAVE BEEN ACCEPTED BY THE CIT(A). IT WAS STATED BY THE LEARNED COUNSEL FOR THE ASSESSEE THAT THE APPLICATION UNDER SECTION 154 OF THE ACT IS STILL PENDING BEFORE THE AO. IN THESE CIRCUMSTANCES, WE ARE OF THE VIEW THAT IT WOULD BE JUST AND APPROPRIATE TO SET ASIDE THE ORDER OF THE CIT(A) AND REMAND THE ISSUES ARISING IN APPEAL BEFORE THE CIT(A) FOR A FRESH CONSIDERATION BY THE CIT(A), AFTER AFFORDING THE ASSESSE OPPORTUNITY OF BEING HEARD. WE ORDER ACCORDINGLY. ACCORDINGLY, THE APPEAL OF THE ASSESSEE IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES. 10. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES. PRONOUNCED IN THE OPEN COURT ON THE DATE MENTIONED ON THE CAPTION PAGE. SD/ - SD/ - (B. R. BASKARAN) ACCOUNTANT MEMBER (N. V. VASUDEVAN) VICE PRESIDENT BANGALORE. DATED: 18 TH JUNE, 2021. /NS/* ITA NO.472/BANG/2020 PAGE 5 OF 5 COPY TO: 1. APPELLANTS 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR 6. GUARD FILE BY ORDER ASSISTANT REGISTRAR, ITAT, BANGALORE.