Kadiri Babu Rao Educational Society, Prakasam V. Commissioner of Income Tax (Exemption ), Hyderabad

ITA 49/Hyd/2020

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 0873 (ITAT-HYDERABAD)
• Duration Of Justice: 1 year(s) 6 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-07-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB-A
• Next Hearing Date: 05-07-2021
• Assessment Year: misc
• Appeal Filed On: 13-01-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NARAYANA MURTHY NAIK
• Assessee Lawyers: Y V BHANUNARAYANA RAO
• Keywords: Opportunity of being heard
• Section: 13

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES A : HYDERABAD (THROUGH VIRTUAL CONFERENCE) BEFORE SHRI SATBEER SINGH GODARA, JUDICIAL MEMBER AND SHRI LAXMI PRASAD SAHU, ACCOUNTANT MEMBER IT A NO. 49 /H/20 20 KADIRI BABU RAO EDUCATIONAL SOCIETY, PRAKASAM DIST. PAN AARFK 1366N VS. COMMISSIONER OF INCOME - TAX (EXEMPTIONS), HYDERABAD. (APPELLANT) (RESPONDENT) ASSESSEE BY: S HRI Y.V. BHANU NARAYANA RAO REVENUE BY: S HRI NARAYANAMURTHY NAIK DATE OF HEARING: 0 5 /0 7 /2021 DATE OF PRONOUNCEMENT: 13 /0 7 /2021 O R D E R PER L.P. SAHU, A.M. : THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST CIT( E ), HYDERABADS ORDER , DATED 12 / 0 9 /201 9 INVOLVING PROCEEDINGS U/S 10(23C)(VI) OF THE INCOME TAX ACT, 1961 ; IN SHORT THE ACT. ON THE FOLLOWING GROUNDS OF APPEAL: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (EXEMPTIONS), HYDERABAD REJECTING THE APPLICATION FILED FOR APPROVAL U/S.1O(23C)(VI) OF THE INCOME TAX ACT, 1961 IS ERRONEOUS AND BAD IN LAW. I TA NO. 49 /HYD /20 20 KADIRI BABU RAO EDUCATIONAL SOCIETY, PRAKASAM DT. : - 2 - : 2 IAN THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (EXEMPTIONS), HYDERABAD OUGHT TO HAVE GRANTED APPROVAL U/S. 1O(23C)(VI) OF THE INCOME TAX ACT, 1961. 3 . IAN THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED COMMISSIONER OF INCOME TAX (EXEMPTIONS), HYDERABAD OUGHT TO HAVE APPRECIATED THE FACT THAT THE MAIN AIM OF THE EDUCATIONAL SOCIETY WAS TO RUN EDUCATIONAL INSTITUTIONS LIKE SCHOOLS, COLLEGES E TC., AS PER THE AIMS AND OBJECTS NO.1 AND OUGHT TO HAVE CONSIDERED THE APPLICATION FOR GRANT OF APPROVAL U/S.1O(23C)(VI) OF THE INCOME TAX ACT, 1961 . 4 . O N THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED COMMISSIONER OF INCOME TAX (EXEMPTION S), HYDERABAD OUGHT NOT HAVE REJECTED THE APPROVAL U/S. 10(23C)(VI) OF THE INCOME TAX ACT, 1961 ONLY FOR THE REASON THAT THE APPELLANT WILL ALSO PROVIDE FACILITIES FOR INDOOR AND OUTDOOR GAMES FOR RECREATION OF MEMBERS APART FROM DOING MANY OTHER CHARITABL E WORKS. 2 . WE NOTICE AT THE OUTSET THAT ASSESSEES INSTANT APPEAL SUFFERS FROM 55 DAYS DELAY IN FILING. TO THIS EFFECT, THE ASSESSEE FILED A PETITION FOR CONDONATION OF THE SAID DELAY ALONG WITH AN AFFIDAVIT AFFIRMING THEREIN THAT THE DEPONENT FELL A T THE RELEVANT POINT OF TIME AND HENCE THE SOCIETY COULD NOT PURSUE THE TAX ISSUES IN HIS ABSENCE, WHICH CAUSED THE IMPUGNED DELAY IN FILING OF THE INSTANT APPEAL. CASE LAW COLLECTOR LAND ACQUISITION VS MST. KATIJI & ORS, 1987 AIR 1353 (SC) AND UNIVERSIT Y OF DELHI VS. UNION OF INDIA, CIVIL APPEAL NO. 9488 & 9489/2019 DATED 17 DECEMBER, 2019, HOLD THAT SUCH A DELA Y; SUPPORTED BY COGENT REASONS, DESERVES TO BE CONDONED SO AS TO MAKE WAY FOR THE CAUSE OF I TA NO. 49 /HYD /20 20 KADIRI BABU RAO EDUCATIONAL SOCIETY, PRAKASAM DT. : - 3 - : SUBSTANTIAL JUSTICE. WE ACCORDINGLY HOLD THAT ASSESSEES IMPUGNED DELAY OF 55 DAYS IS NEITHER INTENTIONAL NOR DELIBERATE BUT DUE TO THE CIRCUMSTANCES BEYOND ITS CON TROL. THE SAME STANDS CONDONED. CASE IS NOW TAKEN UP FOR ADJUDICATION ON MERITS. 3. BRIEFLY THE FACTS OF THE CASE ARE THAT THE ASSESSEE FILED AN APPLICATION SEEKING APPROVAL U/S 10(23C)(VI) OF THE ACT IN FORM NO. 56D ON 30/09/2018. A NOTICE DATED 27/05 /2019 WAS SERVED ON THE ASSESSEE TO ATTEND ON 05/06/2019. SINCE THERE WAS NO COMPLIANCE FROM THE ASSESSEE, THE CIT(E) OBSERVED THAT IN THE ABSENCE OF ANY INFORMATION WITH REGARD TO BOOKS OF ACCOUNT AND BILLS & VOUCHERS ON RECORD, THE GENUINENESS OF THE ASS ESSEE AND GENUINENESS OF THE ACTIVITIES COULD NOT BE VERIFIED. ON PERUSAL OF THE AIMS & OBJECTS OF THE SOCIETY, WHICH WERE MENTIONED IN HIS ORDER AT PAGE 2, THE CIT(E) OBSERVED THAT THE OBJECTS OF THE ASSESSEE ARE NOT FOR EDUCATIONAL PURPOSES MAKES AMPLY C LEAR THAT THE INTENTION OF THE SOCIETY IS NOT SOLELY AND EXCLUSIVELY FOR THE PURPOSE OF EDUCATION. REFERRING TO THE PROVISIONS OF SECTION 10(23C ) (VI) OF THE ACT AND RELYING ON THE DECISION OF THE ITAT, VIZAG IN THE CASE OF HAMSAVAHINI EDUCATIONAL SOCIETY I N ITA NO. 390/VIZ/2015, DATED 18/04/2018, THE CIT(E) REJECTED THE APPLICATION FILED BY THE ASSESSEE SEEKING APPROVAL U/S 10(23C ((VI) OF THE ACT. I TA NO. 49 /HYD /20 20 KADIRI BABU RAO EDUCATIONAL SOCIETY, PRAKASAM DT. : - 4 - : 4 . AGGRIEVED BY THE ORDER OF THE CIT(E), THE ASSESSEE IS IN APPEAL BEFORE THE ITAT. 5 . BEFORE US, THE LD. A R OF THE ASSESSEE SUBMITTED THAT THE CIT(E) OUGHT TO HAVE APPRECIATED THE FACT THAT THE MAIN AIM OF THE EDUCATIONAL SOCIETY WAS TO RUN EDUCATIONAL INSTITUTIONS LIKE SCHOOLS, COLLEGES ETC., AS PER THE AIMS AND OBJECTS NO.1 AND OUGHT TO HAVE CONSIDERED THE A PPLICATION FOR GRANT OF APPROVAL U/S.1O(23C)(VI) OF THE INCOME TAX ACT, 1961 . 6 . THE LD. DR, ON THE OTHER HAND, RELIED ON THE ORDER OF CIT(E). 7 . WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD AS WELL AS GONE THROUGH THE ORD ERS OF REVENUE AUTHORITIES. WE ARE OF THE VIEW THAT INTEREST OF JUSTICE WILL BE SERVED IF THE MATTER IS RESTORED TO THE FILE CIT(E) FOR DECIDING THE APPEAL ON MERITS , AS THE ASSESSEE DID NOT APPEAR AND REPRESENT ITS CASE ON MERITS. ACCORDINGLY, THE CIT( E ) IS DIRECTED TO AFFORD REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE AND THEREAFTER DECIDE THE APPEAL ON MERITS. WE DIRECT THE ASSESSEE TO APPEAR BEFORE CIT( E) ON OR BEFORE 30 TH SEPTEMBER, 2021 WITH ALL THE RELEVANT EVIDENCES; AT HIS OWN RISK AND RESPONSIBILITY TO BE FOLLOWED BY THREE EFFECTIVE OPPORTUNITIES OF HEARING. I TA NO. 49 /HYD /20 20 KADIRI BABU RAO EDUCATIONAL SOCIETY, PRAKASAM DT. : - 5 - : 8 . IN THE RESULT, APPEAL OF THE ASSESSEE IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES IN ABOVE TERMS. PRONOUNCED IN THE OPEN COURT ON 13 TH JULY , 2021 . SD/ - SD/ - ( S.S. GODARA ) (L . P . SAHU) JUDICIAL MEMBER ACCOUNTANT MEMBER HYDE RABAD, DATED : 13 TH JU LY , 20 2 1 . K V C OPY TO : 1 KADIRI BABU RAO EDUCATIONAL SOCIETY, 4 - 80, KV NARASAIAH NAGAR, SEELAMVARIPALLI, CHANDRASEKARAPURAM, PRAKASAM DIST. 2 C IT ( E ), 2 RD FLOOR, AAYAKAR BHAVAN, BASHEERBAGH, HYDERABAD 500 001 3 ADDL. C I T( E ) , VIJAYAWADA 4 IT O(E) , GUNTUR. 5 ITAT, DR, HYDERABAD. 6 GUARD FILE.