RAJSHRI FOUNDATION, MUMBAI V. DIT (E), MUMBAI

ITA 5461/MUM/2013

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 5832 (ITAT-MUMBAI)
• Duration Of Justice: 7 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-03-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2013-2014
• Appeal Filed On: 13-08-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A C TEJPAL
• Assessee Lawyers: B V ZAVERI
• Keywords: Opportunity of being heard; Principle of natural justice
• Section: 12A; 12AA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH C, MUMBAI BEFORE SHRI R.C SHARMA, ACCOUNTANT MEMBER AND DR. S.T.M. PAVALAN, JUDICIAL MEMBER ITA NO. 5461/MUM/2013 ASSESSMENT YEAR: 2013-14 RAJSHRI FOUNDATION POONAM CHAMBERS, B WING, 2 ND FLOOR, DR. ANNIE BESANT ROAD, WORLI, MUMBAI-.400 018 VS. DIT(EXEMPTION) 6 TH FLOOR, PIRAMAL CHAMBERS, PAREL MUMBAI400 012 (APPELLANT) (RESPONDENT) PERMANENT ACCOUNT NO. :- AACTR 0035 N ASSESSEE BY : SHRI B. V. ZAVERI REVENUE BY : SHRI A. C. TEJPAL DATE OF HEARING : 13.03.2014 DATE OF PRONOUNCEMENT : 28.03.2014 O R D E R PER DR. S.T.M. PAVALAN, JM: THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAI NST THE ORDER OF THE LD.DIT (EXEMPTION) DATED 24.06.2013 REJECTING THE APPLICAT ION FOR REGISTRATION OF THE ASSESSEES TRUST UNDER THE INCOME-TAX ACT. 2. BRIEFLY STATED, THE ASSESSEES TRUST WAS CONSTIT UTED BY THE TRUST DEED DATED 30.04.2012 WHICH WAS REGISTERED WITH THE CHARITY CO MMISSIONER, MUMBAI ON 27.06.2012 AND FILED AN APPLICATION FOR REGISTRATIO N U/S 12A OF THE INCOME-TAX ACT ON 21.12.2012. THE LD. DIT(E) REJECTED THE REGISTRATIO N IN VIEW OF THE FACT THAT THE TRUST HAD MIXED CHARITABLE AND NON CHARITABLE/COMMERCIAL OBJECTS COUPLED WITH LACK OF BY THE LEGAL OBLIGATION ON TRUSTEE IN REGARD TO APPLIC ATION OF INCOME AND THEREBY NOT SATISFIED WITH THE CHARITABLE CHARACTER OF OBJECTS OF THE ASSESSEES TRUST WHICH IS A CONDITION PRECEDENT FOR GRANT OF REGISTRATION. THER EFORE, ACCORDING TO THE LD. DIT(E) THE ASSESSEES TRUST FAILED TO FULFILL MANDATORY RE QUIREMENTS PRESCRIBED U/S 12AA READ WITH RULE 12A FOR GRANT OF REGISTRATION AND ACCORDI NGLY THE REQUEST FOR REGISTRATION WAS REJECTED BY THE DIT(E). AGGRIEVED BY THE IMPUGN ED ORDER, THE ASSESSEE IS IN APPEAL BEFORE US. ITA NO. 5461/MUM/2013 RAJSHRI FOUNDATION ASSESSMENT YEAR: 2013-14 2 3. IN GROUND NO. 1, THE ASSESSEE HAS RAISED THE GRO UND THAT THE APPLICATION OF THE ASSESSEE FOR GRANT OF REGISTRATION HAS BEEN REJ ECTED BY THE LD.DIT(E) WITHOUT AFFORDING REASONABLE OPPORTUNITY OF BEING HEARD IN VIOLATION OF THE PRINCIPLES OF NATURAL JUSTICE AND EQUITY. IT IS OBSERVED THAT THE LD.DIT(E) HAS SENT A NOTICE DATED 13.03.2013 REQUIRING THE ASSESSEE TO FURNISH CERTAI N DETAILS/DOCUMENTS LIKE PAN CARDS OF SETTLER AND TRUSTEES, COPIES OF BANK ACCOU NTS, NOC IN RESPECT OF ITS OFFICE PREMISES, CERTIFICATE OF REGISTRATION ISSUED BY THE CHARITY COMMISSIONER ETC. AGAIN THE MANAGING TRUSTEE OF THE ASSESSEE WAS CALLED UPO N TO ATTEND THE OFFICE ON 02.04.2013 FOR VERIFICATION OF THE ORIGINAL DOCUMEN T. IT APPEARS THAT THE ASSESSEE HAS FILED LETTERS DATED 18.04.2013 AND 29.04.2013 B EFORE THE LD.DIT(E). HOWEVER, THE LD.DIT(E) HAS NOT GIVEN REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE BEFORE REJECTING THE APPLICATION FILED BY THE ASSES SEE. IT IS PERTINENT TO MENTION THAT ACCORDING TO SECTION 12AA OF THE ACT, IF THE COMMIS SIONER IS NOT SATISFIED WITH THE CONDITIONS PRESCRIBED IN THE SAID SECTION, HE CAN P ASS AN ORDER REFUSING TO REGISTER THE TRUST OR INSTITUTION. HOWEVER, NO SUCH ORDER CA N BE PASSED UNLESS THE ASSESSEE HAS BEEN GIVEN A REASONABLE OPPORTUNITY OF BEING HE ARD. IN THE INSTANT CASE, THOUGH THE ASSESSEE HAS FILED CERTAIN LETTERS BEFORE THE L D.DIT(E), THE ASSESSEE HAS NOT BEEN PROVIDED WITH REASONABLE OPPORTUNITY TO EXPLAI N ITS CASE AS REQUIRED BY THE PROVISIONS OF SECTION 12AA OF THE ACT. IN VIEW OF T HAT MATTER, WE SET ASIDE THIS ISSUE TO THE FILE OF THE LD.DIT(E) FOR CONSIDERING ISSUE OF GRANT OF REGISTRATION AFRESH AFTER GIVING REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. WE DIRECT AND ORDER ACCORDINGLY. SINCE WE ARE DIRECTING THE LD.DIT(E) T O DECIDE THE MATTER AFRESH, THE ADJUDICATION OF THE ISSUES RAISED ON MERITS IN GROU NDS NO. 3,4 AND 5 OF THE APPEAL IS NOT REQUIRED. 4. IN THE RESULT THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 28 TH DAY OF MARCH, 2014. SD/- SD/- (R.C. SHARMA) (DR. S.T.M. PAVALAN) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED: 28.03.2014. *SRIVASTAVA ITA NO. 5461/MUM/2013 RAJSHRI FOUNDATION ASSESSMENT YEAR: 2013-14 3 COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT(A) CONCERNED, MUMBAI THE DR C BENCH //TRUE COPY// BY ORDER DY/ASSTT. REGISTRAR, ITAT, MUMBAI.