Access Development Services, New Delhi V. DIT (E), New Delhi

ITA 5252/DEL/2012

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 7048 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 8 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-06-2016
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 25-04-2016
• Assessment Year: misc
• Appeal Filed On: 11-10-2012
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: RAVI JAIN
• Assessee Lawyers: S D KAPILA; PRAVESH SHARMA
• Keywords: Principle of natural justice
• Section: 80G; 12AA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH A NEW DELHI BEFORE SHRI G.D. AGRAWAL, VICE PRESIDENT AND SHRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER ITA NO. 5252/DEL/2012 AY: -- ------ ACCESS DEVELOPMENT SERVICES, VS DIT (E), 28, FIRST FLOOR, NEW DELHI. HAUZ KHAS VILLAGE, NEW DELHI-110016 (PAN: AAFCA7335N) (APPELLANT) (RESPONDENT) APPELLANT BY : S/SHRI S.D. KAPILA, ADV. & PRAVESH SHARMA, ADV. RESPONDENT BY : SHRI RAVI JAIN, CIT DR DATE OF HEARING: 25.04.2016 DATE OF PRONOUNCEMENT: 29.06.2016 ORDER PER SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER THIS APPEAL HAS BEEN PREFERRED BY THE ASSESSEE AGA INST THE ORDER PASSED BY THE LD. DIRECTOR OF INCOME TAX (EXE MPTIONS), DELHI WHEREIN VIDE ORDER DATED 13.8.2012, THE ASSES SEES APPLICATION FOR RENEWAL OF APPROVAL U/S 80G OF THE INCOME TAX ACT, 1961 HAS BEEN REJECTED. 2. THE GROUNDS OF APPEAL READ AS UNDER:- 1. THAT ON FACTS OF THE CASE AND IN LAW, THE ORDE R PASSED BY THE LD. DIRECTOR OF INCOME TAX (EXEMPTI ONS) IS ILLEGAL. 2. THAT ON FACTS OF THE CASE AND IN LAW T HE LD. I.T.A. NO. 5252/D/2012 2 DIT (EXEMPTION) ERRED IN NOT RENEWING THE APPROVAL UNDER SECTION 80G(VI) ON THE GROUND THAT IT DOES NO T FULFIL THE CONDITIONS LAID DOWN IN SECTION 80G(5) OF THE I NCOME- TAX ACT. 3. THE APPELLANT CRAVES TO LEAVE TO ADD, ALTER AME ND/OR MODIFY ANY OF THE GROUNDS OF APPEAL AT OR BEFORE TH E HEARING OF APPEAL. 3. THE LD. AR SUBMITTED THAT THE ASSESSEE IS REG ISTERED U/S 12AA OF THE ACT AND WAS ALSO ENJOYING THE BENEFIT O F APPROVAL U/S 80G (VI) OF THE ACT WHICH WAS VALID UP TO 31.03 .2008. HOWEVER, THE APPLICATION FOR THE RENEWAL OF THE APP ROVAL HAS BEEN REJECTED WITHOUT AFFORDING A PROPER OPPORTUNIT Y TO THE ASSESSEE TO EXPLAIN ITS CASE. 4. LEARNED DEPARTMENTAL REPRESENTATIVE SUPPORTED THE ORDER OF THE LD. DIT (E). 5. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RELEVANT MATERIAL PLACED ON RECORD. IN PARA 3 OF T HE IMPUGNED ORDER, IT IS SEEN THAT THE LD. DIT(E) HAS REJECTED THE APPLICATION OF THE ASSESSEE ENTIRELY ON THE BASIS OF DOCUMENTS SUBMITTED BY THE ASSESSEE AND HAS NOTED AS UNDER:- 3. ON PERUSAL OF THE DETAILS OF SUBMITTED, IT IS FOUND FROM VARIOUS DOCUMENTS THAT THE COMPANY PROVIDES SERVICES ON CONTRACT BASIS AS IT BEING HAVING PROFESSIONAL SKILLS AND PERSONNEL/TECHNICAL RESOURC ES IN I.T.A. NO. 5252/D/2012 3 THE SO CALLED FIELD OF CLIENTS REQUIREMENT. IN LIEU OF THE SERVICES PROVIDED THE COMPANY GETS FEES FROM THE CL IENTS WITH WHOM THE CONTRACT IS MADE. IT IS VERIFIED FROM CONTRACT MADE WITH MADHYA PRADESH SOCIETY FOR RURAL LIVELIHOOD PROMOT ION DIRECTORATE OF FARMERS WELFARE AND AGRICULTURE DEVELOPMENT RAJASTHAN HORTICULTURE DEVELOPMENT SOCIETY WHEREAS, THE COMPANY HAS NOT DONE ANY CHARITY IN LAST FOUR YEARS FROM ITS OWN RESOURCES INSTEAD IT W ORKED AS AN AGENT OR SERVICE PROVIDER ON FEES BASIS THROU GH CONTRACT MADE WITH DIFFERENT ORGANISATIONS. THERE I S NO OWN CHARITABLE ACTIVITY OF THE COMPANY, THE FINANCI AL STATEMENT OF THE COMPANY SHOWS INCOME FROM GRANTS, CONSULTANCY INCOME, CONFERENCE RECEIPTS AND MICRO FINANCE ALLIANCE MEMBERSHIP FEES AND THE EXPENSES MADE ARE IN RESPECT OF THESE INCOME RECEIVED AS PER THE NORMS OF THE CLIENTS DEFINE/MENTIONED IN THE CONTRA CT. THE COMPANY IS EXACTLY SELLING ITS EXPERTISE IN LIE U OF FEES BY WAY OF CONSULTANCY, CONFERENCES AND ALSO BY MAKING MEMBER ALLIANCE FROM OTHER ORGANIZATIONS. TH E TDS WERE ALSO DEDUCTED ( RS.58,42,739/- FOR 2010 & RS.29,12,454/- FOR 2009) BY THE PARTIES WHO HAD MAD E THE PAYMENT TO THE APPLICANT. IT IS VERY CLEAR THES E ARE PROFESSIONAL RECEIPTS IT IS NOT AT ALL A CHARITABLE ACTIVITY IN ANY MANNER. 4. IN VIEW OF THE ABOVE FACTS, IT IS HELD THAT THE COMPANY DID NOT FULFILL THE CONDITIONS LAID DOWN FO R GRANT OF EXEMPTION U/S 80G(5) OF THE INCOME TAX ACT 1961. THE APPLICANTS APPLICATION FURNISHED IN FORM NO. 10G FOR RENEWAL OF EXEMPTION U/S 80G OF THE INCOME TAX ACT, 1961 IS HEREBY REJECTED. 6. THUS, IT IS SEEN THAT THE LD. DIT (EXEMPTIONS) H AS NOT CALLED FOR ANY CLARIFICATIONS/JUSTIFICATIONS FROM THE ASSE SSEE AND HAS PROCEEDED TO ADJUDICATE AND REJECT THE ASSESSEES A PPLICATION IN CONTRAVENTION OF THE PRINCIPLES OF NATURAL JUSTICE. THEREFORE, IN THE INTEREST OF JUSTICE, WE RESTORE THE ISSUE TO TH E FILE OF THE LD. DIT (EXEMPTIONS) FOR FRESH ADJUDICATION WITH THE DI RECTION THAT THE ASSESSEE BE AFFORDED A PROPER OPPORTUNITY OF BE ING HEARD I.T.A. NO. 5252/D/2012 4 BEFORE SUCH ADJUDICATION. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 29 TH JUNE, 2016. SD/- SD/- (G.D. AGRAWAL) (SUDHANSHU SRIVA STAVA) VICE PRESIDENT JUDICIAL MEMBER DATED: THE 29 TH OF JUNE 2016 GS COPY OF THE ORDER FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR 6. GUARD FILE BY ORDER ASSTT. REGISTRAR I.T.A. NO. 5252/D/2012 5