M/s Indo Global Education Foundation, Mohali V. DCIT, Chandigarh

ITA 533/CHANDI/2015

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 8537 (ITAT-CHANDIGARH)
• Duration Of Justice: 8 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-02-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2010-2011
• Appeal Filed On: 15-05-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: A K SOOD
• Keywords: Cancellation of registration
• Section: 12A; 12AA; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH, CHANDIGARH BEFORE SHRI H.L.KARWA, VICE PRESIDENT AND MS. RANO JAIN, ACCOUNTANT MEMBER ITA NO.533/CHD/2015 (ASSESSMENT YEAR : 2010-11) M/S INDO GLOBAL EDUCATION VS. THE D.C.I.T., FOUNDATION, VILLAGE ABHIPUR, CENTRAL CIRCLE I, TEHSIL MAJRI, KHARAR, CHANDIGARH. DISTT. MOHALI. PAN: AAAT12838L AND ITA NO.524/CHD/2015 (ASSESSMENT YEAR : 2010-11) THE D.C.I.T., VS. M/S INDO GLOBAL EDUCATION CENTRAL CIRCLE I, FOUNDATION, VILLAGE ABHIPUR, CHANDIGARH. TEHSIL MAJRI, KHARAR, DISTT. MOHALI. PAN: AAAT12838L (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI A.K. SOOD DEPARTMENT BY : SHRI SUSHIL KUMAR, DR DATE OF HEARING : 12.01.2016 DATE OF PRONOUNCEMENT : 01.02.2016 O R D E R PER RANO JAIN, A.M . : THE APPEAL OF THE ASSESSEE IN ITA NO.533/CHD/2015 AND THE APPEAL OF THE REVENUE IN I TA NO.524/CHD/2015 ARE DIRECTED AGAINST THE SEPARATE O RDERS 2 OF LEARNED PRINCIPAL COMMISSIONER OF INCOME TAX (OS D), GURGAON BOTH DATED 5.3.2015 ASSESSMENT YEAR 2010-11 . ITA NO.533/CHD/2015 (ASSESSEES APPEAL) : 2. BRIEFLY, THE FACTS OF THE CASE ARE THAT THE ASSESSEE FILED RETURN OF INCOME FOR THE RELEVANT ASSESSMENT YEAR AS ON 28.9.2010 DECLARING NIL INCOM E. THE ASSESSEE WAS GRANTED REGISTRATION UNDER SECTION 12AA OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT) BY THE CIT- II, CHANDIGARH VIDE ORDER DATED 17.1.2003 EFFECTIVE FROM 12.6.2002. THE SOCIETY WAS FURTHER APPROVED AS AN EDUCATIONAL INSTITUTION UNDER SECTION 10(23C)(VI) O F THE ACT BY THE CCIT, NORTH WEST REGION, CHANDIGARH VIDE ORDER DATED 27.7.2007. 3. THE REGISTRATION GRANTED UNDER SECTION 12A OF THE ACT WAS CANCELLED BY THE CIT(CENTRAL) VIDE ORDE R DATED 19.12.2011. SIMILARLY, THE DGIT(INV.), CHANDIGARH VIDE HIS ORDER DATED 21.3.2012 ALSO WITHDRAWN THE EXEMPT ION GRANTED UNDER SECTION 10(23C)(VI) OF THE ACT. 4. IN VIEW OF THESE CANCELLATIONS OF REGISTRATION BOTH UNDER SECTION 12A AS WELL AS UNDER SECTION 10(23C)(VI) OF THE ACT, THE ASSESSING OFFICER MADE AN ADDITION OF RS.1,64,98,475/- BEING EXCESS OF INCOME OVER EXPENDITURE. 5. THE ASSESSEE FILED AN APPEAL BEFORE THE CIT (APPEALS) AS ON 24.10.2013. BEFORE THE CIT (APPEAL S), IT 3 WAS SUBMITTED THAT THE ORDER CANCELLING THE REGISTR ATION UNDER SECTION 12A WAS CHALLENGED BEFORE THE I.T.A.T ., CHANDIGARH BENCH AND BY ORDER 22.1.2015, I.E. AFTER THE PASSING OF THE ASSESSMENT ORDER FOR THE RELEVANT ASSESSMENT YEAR, THE REGISTRATION UNDER SECTION 12A OF THE ACT WAS RESTORED TO THE ASSESSEE. IT WAS ALSO SUB MITTED THAT THE ORDER OF THE DGIT CANCELING THE REGISTRATI ON UNDER SECTION 10(23C)(VI) OF THE ACT WAS ALSO CHALL ENGED BEFORE THE HON'BLE HIGH COURT. THE CIT (APPEALS) A FTER ELABORATELY QUOTING THE ORDER OF THE I.T.A.T. HELD THAT AS ON DATE THE WRIT PETITION OF THE ASSESSEE AGAINST T HE WITHDRAWAL OF EXEMPTION UNDER SECTION 10(23C)(VI) O F THE ACT IS PENDING BEFORE THE PUNJAB & HARYANA HIGH COU RT, AS THE MATTER IS AWAITING ADJUDICATION, SHE PREFERR ED NOT TO INTERFERE IN THE ADDITION MADE BY THE ASSESSING OFFICER AND DISMISSED THE APPEAL. 6. AGGRIEVED, THE ASSESSEE HAS COME IN APPEAL BEFORE US, RAISING THE FOLLOWING GROUNDS OF APPEAL : 1 . THAT THE ORDERS OF THE LEARNED PRINCIPAL COMMISSIONER OF INCOME TAX (OSD), GURGAON WITH CHARGE OF CIT (A)-3, GURGAON, ARE CONTRARY TO LAW AND THE FACTS OF THE CASE. 2, THAT THE LD PRINCIPAL COMMISSIONER OF INCOME TAX (OSD) HAS ERRED IN CONFIRMING THE ADDITION OF RS1,64,98,475/- WHEREAS THE HON'BLE ITAT HAS RESTOR ED THE REGISTRATION OF THE ASSESSEE U/S 12AA FROM THE DATE OF APPROVAL AND ITS INCOME IS EXEMPT U/S 12AA AS MORE THAN 85% OF ITS INCOME HAS BEEN APPLIED FOR THE OBJ ECTS OF THE SOCIETY. 4 3. FOR THESE AND OTHER REASONS THAT MAY BE URGED AT THE TIME OF HEARING THE APPELLANT PRAYS FOR RELIEF. 7. THE LEARNED COUNSEL FOR THE ASSESSEE REITERATED THE SUBMISSION MADE BEFORE THE LEARNED CIT (APPEALS ). HIS CONTENTION WAS THAT SINCE REGISTRATION UNDER SE CTION 12A OF THE ACT HAS BEEN RESTORED TO THE ASSESSEE BY THE ORDER OF THE HON'BLE I.T.A.T., IRRESPECTIVE OF THE FATE OF WRIT PETITION AGAINST CANCELLATION OF REGISTRATION UNDER SECTION 10(23C)(VI) OF THE ACT, THE EXEMPTION UNDER SECTION 11 OF THE ACT SHOULD BE MADE AVAILABLE TO THE ASSES SEE. 8. THE LEARNED D.R. RELIED ON THE ORDER OF THE LEARNED CIT (APPEALS). 9. WE HAVE HEARD THE LEARNED REPRESENTATIVES OF BOTH THE PARTIES, PERUSED THE FINDINGS OF THE AUTHO RITIES BELOW AND CONSIDERED THE MATERIAL AVAILABLE ON RECO RD. THIS IS AN UNDISPUTED FACT THAT AS ON DATE THE REGI STRATION UNDER SECTION 12AA OF THE ACT IS AVAILABLE TO THE A SSESSEE, IN VIEW OF THE ORDER OF THE I.T.A.T. THE EXEMPTIO N UNDER SECTION 11 OF THE ACT IS AVAILABLE TO AN ASSESSEE S UBJECT TO THE PROVISIONS OF SECTIONS11 AND 13 OF THE ACT. THI S EXEMPTION IS AVAILABLE IRRESPECTIVE OF THE FACT WHE THER THE REGISTRATION UNDER SECTION 10(23C)(VI) OF THE ACT I S AVAILABLE TO IT OR NOT. IN VIEW OF THIS, WE THINK IT PROPER TO SEND THE CASE BACK TO THE FILE OF THE ASSESSING OFFICER TO ALLOW THE ASSESSEE EXEMPTION UNDER SECTION 11 OF THE ACT AFTER VERIFYING ITS ELIGIBILITY UNDER OTHER PRO VISION OF 5 THE ACT, IN THE BACKGROUND OF THE FACT THAT IT IS R EGISTERED UNDER SECTION 12A OF THE ACT. 10. THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ITA NO.524/CHD/2015 (REVENUES APPEAL) : 11. THIS IS AN APPEAL FILED BY THE DEPARTMENT AGAINST THE ACTION OF THE CIT (APPEALS) IN DELETING THE PENALTY UNDER SECTION 271(1)(C) OF THE ACT, IMPOSED BY THE ASSESSING OFFICER ON THE ADDITION MADE UNDER THE FA CTS NARRATED IN ITA NO.533/CHD/2015. SINCE THE QUANTUM PROCEEDINGS ARE SET ASIDE TO THE FILE OF THE ASSESS ING OFFICER TO DECIDE AFRESH, THE PENALTY UNDER SECTION 271(1)(C) OF THE ACT DOES NOT SURVIVE. 12. THE APPEAL OF THE DEPARTMENT IS DISMISSED. 13. IN THE RESULT, THE APPEAL OF THE ASSESSEE IN I TA NO.533/CHD/2015 IS ALLOWED FOR STATISTICAL PURPOSES AND THE APPEAL OF THE DEPARTMENT IN ITA NO.524/CHD/2015 IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 1 ST DAY OF FEBRUARY, 2016. SD/- SD/- (H.L. KARWA) (RANO JAIN) VICE PRESIDENT ACCOUNTANT MEMBER DATED : 1 ST FEBRUARY, 2016 *RATI* COPY TO: THE APPELLANT/THE RESPONDENT/THE CIT(A)/THE CIT/THE DR. ASSISTANT REGISTRAR, ITAT, CHANDIGARH 6