Sri Guru Angad Dev College, Tarn Taran V. The Commissioner of Income-tax-I, Amritsar.

ITA 499/ASR/2014

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 8903 (ITAT-AMRITSAR)
• Duration Of Justice: 1 year(s) 5 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-01-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 20-01-2016
• Assessment Year: misc
• Appeal Filed On: 28-07-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R K SHARDA
• Assessee Lawyers: J P SINGH
• Keywords: Opportunity of being heard; Principle of natural justice; Source of fund
• Section: 12A; 10B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH; AMRITSAR BEFORE SH. A.D.JAIN, HONBLE JUDICIAL MEMBER AND SH. T.S. KAPOOR, HONBLE ACCOUNTANT MEMBER I.T.A NO. 499(ASR)/2014 ASSESSMENT YEAR: ....... SRI GURU ANGAD DEV COLLEGE, KHADUR SAHIB TARAN TARAN. PAN:AAABS-1442C VS. THE CIT I AMRITSAR. (APPELLANT) (RESPONDENT) APPELLANT BY: SH. J.P. SINGH (CA ) RESPONDENT BY: SH. R.K. SHARDA (DR.) DATE OF HEARING: 20.01. 2016 DATE OF PRONO UNCEMENT: 22.01.2016 ORDER PER T. S. KAPOOR (AM): THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINS T THE ORDER OF LEARNED CIT, PASSED U/S. 12AA(1)(B)(2). 2. THE GROUNDS OF APPEAL TAKEN BY ASSESSEE ARE REPR ODUCED BELOW. (I) THAT THE LEARNED COMMISSIONER OF INCOME TAX HA S WRONGLY DENIED US THE REGISTRATION U/S12AA WITHOUT RECORDIN G ANY SATISFACTION THAT THE ACTIVITIES OF OUR SOCIETY ARE NOT GENUINE OR ARE NOT AS PER OBJECTS OF THE SOCIETY AND THE LEARNED C IT HAS REJECTED OUR REGISTRATION APPLICATION FILED U/S 12A ON THE BASIS OF THE POINTS WHICH ARE NOT RELEVANT FOR THE PURPOSE OF REGISTRAT ION OF OUR SOCIETY U/S 12AA. 2. THAT THE LEARNED CIT IN ITS PARA 2.1 AND 2.2. OF HIS ORDER HAS WRONGLY HELD THAT THE SOCIETY HAS NOT PROVIDED ANY CLAUSE IN ITS CONSTITUTION DETERMINING THE SOURCE OF ITS FUNDS WH EREAS CLAUSE 4 IX OF OUR NEW CONSTITUTION AND CLAUSE 6(X) OF OUR OLD CONSTITUTION CLEARLY MENTIONS OUR SOURCES OF INCOME AND THESE INCOMES AR E ARISING TO US ITA NO.499 (ASR)/2014 2 OUT OF OUR PRINCIPAL ACTIVITY OF RUNNING OF EDUCATI ONAL INSTITUTION AND HE HAS MADE THIS AS A REASON FOR THE REJECTION OF O UR APPLICATION. 3. THAT THE LEARNED COMMISSIONER OF INCOME TAX IN I TS PARA 3.0 OF HIS ORDER HAS WRONGLY MADE NON FILING OF INCOME TAX RETURN AS REASON FOR REJECTING OUR APPLICATION WHEREAS WE HA VE CLEARLY EXPLAINED THE REASON FOR NON FILING OF INCOME TAX R ETURN THAT WE ARE COVERED U/S 1023C (IIIB) AS WE ARE A STATE GOVERNME NT AIDED COLLEGE AND GETTING SUBSTANTIAL GRANTS FROM THE COLLEGE AND THERE IS NO REQUIREMENT FOR FILING RETURN U/S F39(4C) FOR THE I NSTITUTIONS WHICH ARE COVERED U/S 10(23C)(IIIAB). 4. THAT THE LEARNED CIT HAS WRONGLY HELD IN PARA 4 OF HIS ORDER THAT THE AUDIT REPORT IN FORM 10B WAS REQUIRED TO B E ATTACHED WITH THE REGISTRATION APPLICATION AND HE HAS WRONGLY MAD E THIS NON FILING OF FORM 10B AS A REASON FOR THE REJECTION OF OUR AP PLICATION DESPITE THE FACT THAT THE DULY AUDITED ACCOUNTS WHICH HAVE BEEN REPORTED AS CORRECT BY THE CHARTERED ACCOUNT HAVE BEEN ATTACHED WITH THE REGISTRATION APPLICATION. 5. THAT THE LEARNED COMMISSIONER OF INCOME TAX IN ITS PARA 5.0 OF HIS ORDER HAS WRONGLY TREATED THE DONATIONS TO T HE SOCIETY AS ANONYMOUS DONATIONS WITHOUT GIVING US ANY OPPORTU NITY OR WITHOUT ASKING US TO FILE DETAILS OF THE DONATIONS WHEREAS NONE OF OUR DONATIONS ARE ANONYMOUS DONATIONS AND THE LEARN ED CIT HAS WRONGLY MADE THIS AS A REASON FOR REJECTION OUR APP LICATION. 6. THAT THE ORDER OF THE LEARNED COMMISSIONER OF IN COME TAX IS BAD ON LAW AND ON THE FACTS 3. AT THE OUTSET, LEARNED AR INVITED OUR ATTENTION TO THE FINDINGS OF LEARNED CIT WITH REGARD TO HIS FIRST OBJECTION REGA RDING NON-EXISTENCE OF CLAUSE IN ITS CONSTITUTION DETERMINING THE SOURCE O F ITS FUNDS. THE LEARNED AR INVITED OUR ATTENTION TO COPY OF CONSTIT UTION OF THE SOCIETY AND SUBMITTED THAT AS PER CLAUSE V AND X OF THE AMENDED CONSTITUTION AND AS PER CLAUSE V AND IX OF THE ORIGINAL CONSTITUTIONS T HERE WERE SPECIFICALLY CLAUSES DETERMINING THE SOURCES OF FUNDS OF THE SOC IETY AND THEREFORE, HE SUBMITTED THAT LEARNED CITS FINDINGS IN THIS RESPE CT ARE NOT CORRECT. BEFORE HEARING THE ASSESSEE REGARDING ITS FURTHER G RIEVANCES IT WAS FOUND NECESSARY TO GO THROUGH SHOW CAUSE NOTICE DATED 5.5 .2014 AS MENTIONED ITA NO.499 (ASR)/2014 3 BY LEARNED CIT IN HIS ORDER AND ITS REPLY SUBMITTED BY ASSESSEE. THE LEARNED AR FILED A COPY OF SUCH SHOW CAUSE NOTICE A ND ALSO INVITED OUR ATTENTION TO REPLIES SUBMITTED BY ASSESSEE. IN VIEW OF THE SHOW CAUSE NOTICE AND ITS REPLY WHICH WAS PLACED AT PAPER BOOK PAGE 68, WE FIND THAT LEARNED CIT REQUIRED THE ASSESSEE TO FILE THE FOLLO WING DOCUMENTS (I) MINUTES BOOK (II) REGISTER OF MEMBERS (III) NOTES O N ACTIVITIES OF THE TRUST (IV) BOOKS OF ACCOUNT OF TRUST SINCE ITS INSPECTION TO DATE. THE ABOVE DOCUMENTS WERE FILED BY ASSESSEE VIDE LETTER DATED 8.5.2014 PLACED AT PAPER BOOK PAGE 68 TO 69 IN WHICH THE ASSESSEE HAD SUBMITTED ALL THE DETAILS REQUIRED BY COMMISSIONER OF INCOME TAX. WE FIND THAT AFTER RECEIPT OF THESE DOCUMENTS THE LEARNED CIT OBSERVED CERTAIN SHORT COMINGS AND NARRATED THEM IN HIS ORDER BUT DID NOT SEEM TO HAVE CONFRONTED THE SAME TO ASSESSEE. THE DOCUMENTS AS S OUGHT BY COMMISSIONER WAS FILED VIDE LETTER DATED 8.5.2014 A ND COMMISSIONER HAS PASSED THE ORDER ON 26.05.2014, THEREFORE, WE F IND THAT THE LEARNED CIT HAS NOT PASSED THE ORDER IN A NATURAL AND JUST MANNER WHICH REQUIRED HIM TO CONFRONT THE SHORT COMINGS TO THE A SSESSEE FIRST AND THEN AFTER HEARING THE ASSESSEE ON THE SHORT COMINGS SHO ULD HAVE PASSED THE ORDER. THE COMMISSIONER HAS NOT OFFERED ANY SUCH OP PORTUNITY TO THE ASSESSEE AND HAS PASSED THE ORDER IN VIOLATION OF R ULES OF NATURAL JUSTICE WHEREAS RIGHT OF HEARING IS AN IMPORTANT RULE OF NA TURAL JUSTICE. 4. IN VIEW OF THE ABOVE, WE SET ASIDE THE ORDER OF COMMISSIONER AND DIRECT HIM TO PASS A SPEAKING ORDER AFTER CONFRONTI NG THE ASSESSEE WITH ITA NO.499 (ASR)/2014 4 THE SHORT COMINGS AND AFTER OFFERING IT A REASONABL E OPPORTUNITY OF BEING HEARD. 5. IN VIEW OF THE ABOVE, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 22 ND JANUARY, 2016. SD/- SD/- (A.D. JAIN) (T. S. KAPOOR) JUDICIAL MEMBER ACCOUNTANT ME MBER DATED:22.01.2016. /PK/PS. COPY OF THE ORDER FORWARDED TO: (1) THE ASSESSEE: (2) THE (3) THE CIT(A), (4) THE CIT, (5) THE SR DR, I.T.A.T., TRUE COPY BY ORDER (ASSISTANT REGISTRAR) INCOME TAX APPELLATE TRIBUNAL, AMRITSAR BENCH: AMRITSAR.