Rogi Kalyan Samiti, Kangra V. ITO, Dharamashala

ITA 555/CHANDI/2015

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 95533 (ITAT-CHANDIGARH)
• Duration Of Justice: 3 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-09-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2010-2011
• Appeal Filed On: 21-05-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: D S SIDHU
• Assessee Lawyers: Y K SUD
• Keywords: Opportunity of being heard; Bonafide belief; Condonation of delay
• Section: 143(3); 142(1); 12A; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCHES SMC CHANDIGARH BEFORE SHRI H.L.KARWA, HON'BLE VICE PRESIDENT ITA NO. 555/CHD/2015 ASSESSMENT YEAR: 2010-11 ROGI KALYAN SIMITI, VS. THE ITO, FRU NAGROTA BHAGWAN, DHARAMSHALA TEHSIL & DISTT. KANGRA PAN NO. AAAAR9695K ITA NO. 556/CHD/2015 ASSESSMENT YEAR: 2010-11 ROGI KALYAN SIMITI, VS. THE ITO, PHC GOPALPUR, TEHSIL PALAMPUR, PALAMPUR DISTT. KANGRA PAN NO. AABAR01020L & ITA NO. 557/CHD/2015 ASSESSMENT YEAR: 2010-11 ROGI KALYAN SIMITI, VS. THE ITO, PHC BANURI, TEEHSIL PALAMPUR, PALAMPUR DISTT. KANGRA PAN NO. AABAR1531M (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI Y.K. SUD RESPONDENT BY : SH. D.S. SIDHU DATE OF HEARING : 14.09.2015 DATE OF PRONOUNCEMENT : 17.09.2015 ORDER PER H.L.KARWA, VP THESE THREE APPEALS BY DIFFERENT ASSESSES INVOLVING COMMON ISSUES WERE HEARD TOGETHER AND ARE BEING DISPOSED OF BY THIS CO MMON ORDER FOR THE SAKE OF 2 CONVENIENCE. FIRSTLY, I WILL TAKE UP ITA NO. 555/CHD/2015 RELATING TO ASSESSMENT YEAR 2010-11. IN THIS APPEAL, THE ASSES SEE HAS TAKEN FOLLOWING GROUNDS:- 1. THAT THE CIT(A) WAS NOT JUSTIFIED IN SUSTAINING TH E ACTION OF THE ITO IN ASSESSING THE INCOME OF RS. 300727/- AGA INST THE NIL INCOME DECLARED BY THE ASSESSEE. 2. THAT THE CIT(A) HAS FAILED TO DISPOSE OFF GROUND NO .2 OF DENIAL OF EXEMPTION CLAIMED BY THE ASSESSEE U/S 10( 23C) (IIIAE) AMOUNTING TO RS. 300727/-. 3. THAT CIT(A) FAILED TO APPRECIATE THAT ASSESSEE HAD FULFILLED ALL THE CONDITIONS PRESCRIBED U/S 10(23C)(IIIAE) TH EREFORE, THE EXEMPTION OUGHT TO HAVE BEEN ALLOWED BY HER WHICH W AS WRONGLY DENIED BY ITO. 4. THAT WITHOUT PREJUDICE TO THE GROUNDS RAISED IN 2 & 3 BOTH ASSESSING OFFICER AND CIT(A) FAILED TO APPRECIATE THAT THE GRANTS RECEIVED BY THE SOCIETY FROM THE GOVERNMENT. FOR SPECIFIC PURPOSES COULD NOT BE TREATED AS INCOME OF THE ASSESSEE AND THERE NO TAX COULD BE LEVIED ON THE SA ME. 2. IT IS OBSERVED THAT APPEAL FILED BY THE ASSESSEE IS BARRED BY 130 DAYS. THE IMPUGNED ORDER HAS BEEN PASSED ON 20.10.2014 AND TH E CERTIFIED COPY OF THE SAME WAS SERVED UPON THE ASSESSEE ON 12.11.2014. A S PER LAW, THE ASSESSEE WAS REQUIRED TO FILE THE APPEAL AGAINST THE IMPUGNED OR DER WITHIN 60 DAYS FROM THE DATE OF COMMUNICATION OF THE ORDER. HOWEVER, THE A SSESSEE FILED THE APPEAL IN THE TRIBUNAL ON 25.5.2015. THUS, THERE IS A DELAY OF 130 DAYS IN FILING THE APPEAL BEFORE THE TRIBUNAL. THE ASSESSEE SUBMITTED AN APPLICATION FOR CONDONATION OF DELAY IN FILING THE APPEAL, WHICH R EADS AS UNDER:- BEFORE THE INCOME TAX APPELLATE TRIBUNAL CHANDIGAR H (SMC) IN RE : ROGI KALYAN SARAITI VS. I.T.O. PHC BANURI TEHSIL PALAMPUR DISTT. KANGRA PALAMPUR 3 (APPELLANT) (RESPONDENT) SUB: (REVISED) APPLICATION FOR CONDONATION OF DELAY ASST. YEAR 2010-11 MOST MOST RESPECTFULLY IT IS SUBMITTED AS UNDER:- 1. THAT THE APPELLANT IS REGULARLY ASSESSED TO IN COME TAX WITH INCOME TAX OFFICER PALAMPUR, 2. THAT THE APPELLANT HAD PREFERRED AN APPEAL BEF ORE THE C1T(A) AGAINST THE ORDER OF THE AO PASSED U/S 143(3) OF TH E INCOME TAX ACT. 3. THAT C1T(A) DISPOSED OFF THE ABOVE APPEAL VIDE ITS ORDER DATED 20.10.2014 WHICH WAS SERVED UPON THE ASSESSEE ON 12 .11.2014. 4. THAT THE ASSESSEE THROUGH ITS COUNSEL MR. Y.K .. SUD C.A. PREPARED THE APPEAL ON 29.12.2014 AND AFTER DEPOSITING THE A PPEAL FEE OF RS. 3008/- ON 30.12.2014 HANDED OVER THE APPEAL TO HIS COUNSEL ALONGWITH POWER OF ATTORNEY DATED 29.12.2014 WHICH WAS NOTORI SED ON 31.12.2014.(COPY ENCLOSED) 5. THAT ON 2.1.2015 THE UNDERSIGNED COUNSEL SENT THESE APPEALS TO HIS SON MR. ROHIT SUD ADVOCATE WHO IS PRACTICING IN THE HIGH COURT TO FILE THESE APPEALS BEFORE ITAT WHO HANDED IT OVER T O HIS MUNSHI PANKAJ FOR FILING IN THE ITAT. 7. THAT IT IS ONLY ON ENQUIRY FROM THE REGISTRY O F THE ITAT IT CAME TO THE KNOWLEDGE OF THE UNDERSIGNED IN APRIL THAT THE APPEALS HAVE NOT BEEN FILED. 8. THAT THE UNDERSIGNED COUNSEL IMMEDIATELY GOT T HE FRESH APPEALS PREPARED AND FILED IT WITH THE REGISTRY WHICH ARE L ATE BY 130 DAYS. 9. THAT THE DELAY CAUSED IN FILING THE APPEALS IS NOT ATTRIBUTABLE TO THE ASSESSEE WHO WAS UNDER THE BONAFIDE BELIEF THAT THE APPEALS HAVE BEEN FILED THEREFORE THE SAME MAY KINDLY BE CONDONE D. THE AFFIDAVIT OF THE COUNSEL IN THIS REGARD IS ENCLOSED HEREWITH. 10. THAT FOR CONDONATION OF DELAY THE UNDERSIGNED C OUNSEL WOULD LIKE TO RELY ON THE FOLLOWING JUDGMENTS: A. ABSTRACTS FROM CHALURVEDI & PIRTHISARIA SUPRE ME COURT ON INCOME TAX CASE DIGEST (1922-2015) PAGE 4 TO 5. 4 B. COLLECTOR LAND ACQUISITION VS. MST. KATIJI AND OTHERS{ SUPREME COURT) (1987) 167 HR 471 PAGE 6 TO 9. C. VOLTAS LTD. VS. BY CIT (ANDHRA PRADESH) (2000 ) 163 CTR 249 PAGE 10 TO 12. D. SHAKTI CLEARING AGENCY (P) LTD. VS. LTO (RAJKOT BENCH)(2003) 80 TTJ(RAJKOT) 668 PAGE 13 TO 18. FOR ROGI KALYAN SAMITI PHC BANURI SD/- Y.K. SUD C.A. COUNSEL FOR THE ASSESSEE IN SUPPORT OF THE ABOVE APPLICATION, SHRI Y.K. SUD HAS ALSO SUBMITTED AN AFFIDAVIT. 3. I HAVE HEARD THE LD. REPRESENTATIVES OF BOTH THE PARTIES AT LENGTH. ON A PERUSAL OF THE ABOVE APPLICATION, IT WOULD BE CLEAR THAT MEMORANDUM OF APPEAL WAS PREPARED ON 29.12.2014 AND APPEAL FEE OF RS. 30 08/- WAS DEPOSITED ON 30.12.2014 WHICH IS EVIDENT FROM THE COPY OF THE T AX PAYER COUNTERFOIL RECEIPT SUBMITTED ALONG WITH MEMO OF APPEAL. IT IS FURTHER STATED THAT MEMO OF APPEAL WAS HANDED OVER TO MUNSHI PANKAJ FOR FILING THE S AME IN THE TRIBUNAL. HOWEVER, IT IS STATED THAT MUNSHI HAD MISPLACED THE MEMO OF APPEAL AND AT THE SAME TIME THE SAID MUNSHI HAD REPORTED THAT THE APP EAL HAS BEEN FILED AND THE COUNSEL WAS UNDER THE BONAFIDE BELIEF THAT THE APPE AL HAS BEEN FILED IN TIME. HOWEVER, ON ENQUIRY FROM THE REGISTRY OF THE TRIBUN AL, THE COUNSEL OF THE ASSESSEE IN THE MONTH OF APRIL 2015 CAME TO KNOW TH AT APPEAL HAD NOT BEEN FILED. THEREAFTER, THE COUNSEL OF THE ASSESSEE PREP ARED A FRESH MEMO OF APPEAL AND FILED THE SAME WITH THE REGISTRY OF THE TRIBUNA L WHICH WAS LATE BY 130 DAYS. THERE IS NO MATERIAL ON RECORD TO CONTROVERT THE AB OVE CONTENTION MADE ON BEHALF OF THE ASSESSEE. I AGREE WITH THIS CONTENTI ON THAT THE LD. COUNSEL FOR THE 5 ASSESSEE THAT DELAY CAUSED IN FILING THE APPEAL IS NOT ATTRIBUTABLE TO THE ASSESSEE WHO WAS UNDER THE BONAFIDE BELIEF THAT THE APPEAL HAS BEEN FILED IN TIME. THE REASONS FOR DELAY APPEAR TO BE BONAFIDE AND I AM FU LLY SATISFIED WITH THE EXPLANATION GIVEN BY THE ASSESSEE FOR THE DELAY IN FILING THE APPEAL. THEREFORE, I AM SATISFIED THAT THERE WAS SUFFICIENT CAUSE WHICH PREVENTED THE ASSESSEE FORM FILING THE PRESENT APPEAL. IT IS WELL SETTLED THAT JURISDICTION TO CONDONE DELAY SHOULD BE EXERCISED LIBERALLY. MATTER RELATING TO C ONDONATION OF DELAY SHOULD BE JUDGED BROADLY AND NOT IN A PEDANTIC MANNER. IN TH E CASE OF LAXMAN DASS ARORA V. GANESHI LAL (1999) 8 SCC 532, 538 [1999], THE H ON'BLE SUPREME COURT HELD AS UNDER:- IF SUFFICIENT CAUSE FOR EXECUTING DELAY IS SHOWN, DISCRETION IS GIVEN TO THE COURT TO CONDONE DELAY AND ADMIT THE APPEAL. THIS DISCRETION HAS BEEN DELIBERATELY CONFERRED ON THE COURT IN ORD ER THAT JUDICIAL POWER AND DISCRETION IN THAT BEHALF SHOULD BE EXERC ISED TO ADVANCE SUBSTANTIAL JUSTICE. THE EXPRESSION SUFFICIENT CA USE MUST RECEIVED A LIBERAL CONSTRUCTION SO AS TO ADVANCE SUBSTANTIAL JUSTICE AND GENERALLY DELAYS BE CONDONED IN THE INTEREST OF JUS TICE WHERE GROSS NEGLIGENCE OR DELIBERATION INACTION OR LACK OF BONA FIDES IS NOT IMPUTABLE TO THE PARTY SEEKING CONDONATION OF DELAY CONSIDERING THE ENTIRE FACTS AND CIRCUMSTANCES OF T HE PRESENT CASE AND ALSO SETTLED LEGAL POSITION, I CONDONE THE DELAY OF 130 DAYS IN FILING THE APPEAL. 4. AS REGARDS MERITS OF THE CASE, THE FACTS ARE THA T THE ASSESSEE SOCIETY FILED ITS RETURN OF INCOME ON 13.10.2010 DECLARING TOTAL INCOME AT NIL. THE SAID RETURN WAS PROCESSED U/S 143(1) OF THE INCOME-TAX ACT, 196 1 (IN SHORT 'THE ACT') ON 26.11.2011. SUBSEQUENTLY, THE CASE WAS SELECTED FO R SCRUTINY, THE ASSESSING OFFICER ISSUED NOTICES U/S 143(2) AND 142(1) TO THE ASSESSEE. THE MAIN AIM AND OBJECTS OF THE SOCIETY ARE TO CREATE SOUND SOCIAL E NVIRONMENT, TO ENCOURAGE ADULTS FOR UNITY OF THE NATION TO PROVIDE SELF EMPL OYMENT TO YOUNG GIRLS, TO DRAW 6 ATTENTION OF YOUNGSTERS FOR RELIGIOUS WORK AND TO C REATE INTEREST OF YOUNGSTERS FOR SPORTS ACTIVITIES ETC.. THE ASSESSEE SOCIETY HA S SHOWN GROSS RECEIPTS OF RS. 16,44,801/- OUT OF WHICH AN AMOUNT OF RS. 3,00,727/ - WAS SHOWN AS EXCESS OF INCOME OVER EXPENDITURE AND CLAIMED IT EXEMPT U/S 1 2A OF THE ACT.. THE SOCIETY HAS BEEN GRANTED REGISTRATION U/S 12A OF THE ACT B Y THE COMMISSIONER, SHIMLA VIDE HIS ORDER DATED 8.2.2011 W.E.F. ASSESSMENT YEA R 2011-12 ONWARDS. AS PER THE ASSESSING OFFICER, FOR THIS YEAR NO REGISTRATIO N WAS GRANTED U/S 12A OF THE ACT AND, THEREFORE, INCOME CLAIMED AS EXEMPT AT RS. 3,00,727/- FOR THE YEAR UNDER CONSIDERATION WAS TREATED AS INCOME OF THE AS SESSEE. 5. AGGRIEVED BY THE ORDER OF ASSESSING OFFICER THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE CIT(A) AND THE ASSESSEE MADE FOLLOWING SUBMISSIONS:- 1. OUR SOCIETY IS REGISTERED UNDER THE SOCIETIES ACT 1860 IN ORDER TO FACILITIES AND TO PROVIDE THE MEDICAL FACILITIES TO NEARBY PEOPLE AT VERY NOMINAL RATES. 2. THE ASSESSING OFFICER HAS WRONGLY REJECTED THE EXEM PTION OF INCOME FOR THE ASSESSMENT YEAR 2010-11 AND DISOBEYE D THE JUDGEMENT OF THE HON'BLE HIGH COURT OF GAUHATI IN C ASE OF CIT VS. SHRIRMANTA SANKAR ACADEMY IN 2010, THE COMPLETE COPY OF THE JUDGEMENT OF ABOVE SAID ORDER IS PLACED ON THE RECORD IN PAGE 3 TO 5 FOR YOUR REFERENCE PLEASE. 3. THERE IS NO BENEFIT TAKEN BY THE ANY MEMBER OF THE SOCIETY IN KIND OR IN CASH U/S 13(1) (C) OF THE INCOME TAX ACT , 1961. 4. THIS SOCIETY IS WHOLLY FINANCED BY THE GOVERNMENT O F INDIA UNDER TO NATIONAL RURAL HEALTH MISSION TO PROVIDE THE HEA LTH FACILITIES ONLY. 5. THE WHOLE OF SOCIETY IS MANAGED BY THE GOVERNMENT O FFICERS AND NOT BY ANY INDIVIDUAL PERSON OR ENTITY AND THE SHAR ES OF ANY OR ALL OF THE MEMBERS ARE NOT KNOWN AND NOT IDENTIFIED . 7 6. THE MEMBER OF GOVERNING BODY USE TO RENDER THEIR SE RVICES TO THE SOCIETY FREE OF COST AND THEY ARE NOT CHARGING ANY SINGLE PENY FOR THE SAME. 7. IN THIS REGARD IT IS HUMBLY SUBMITTED THAT OUR CASE MAY BE DECIDED ON THE MERITS OF GROUND AND RELIEF MAY KIND LY BE GIVEN TO HOSPITAL.' 6. THE LD. CIT(A) REJECTED THE CLAIM OF THE ASSESSE E STATING THAT THE ASSESSING OFFICER HAS NOT ALLOWED THE BENEFIT U/S 12A AS ASSESSEE DID NOT HAVE REGISTRATION U/S 12A FOR ASSESSMENT YEAR 2010-11. HE FURTHER OBSERVED THAT THE ASSESSEE GOT REGISTRATION U/S 12A W.E.F. ASSESSMENT YEAR 2012-13 ONLY (AS PER ASSESSING OFFICER W.E.F. 2011-12) AND THERE WAS NOT VALID REGISTRATION U/S 12A FOR ASSESSMENT YEAR 2011-12. THE LD. CIT(A) FURTHER OBSERVED THAT PROVISION OF SECTION 12 ARE NOT APPLICABLE TO THIS CASE AS ASSES SEE HAS NOT RECEIVED ANY VOLUNTARY CONTRIBUTION. ACCORDING TO LD. CIT(A), T HE RECEIPTS OF THE ASSESSEE ARE IN THE NATURE OF FEE FOR BETTER HEALTH FACILITY FOR THE PATIENTS COMING TO THE HOSPITALS. THE LD. CIT(A) HAS ALSO OBSERVED THAT TH E ASSESSEE HAS NEITHER SPENT 85% OF THE RECEIPTS DURING THE YEAR NOR FURNISHED T HE REQUISITE FORM AS PROVIDED U/S 11(2) AND THEREFORE, EXEMPTION U/S 11 OF THE AC T ALSO CANNOT BE GRANTED. ACCORDINGLY, SHE DISMISSED THE APPEAL OF THE ASSESS EE. NOW THE ASSESSEE IS IN APPEAL AGAINST THE ORDER OF CIT(A) BEFORE THIS BENC H OF THE TRIBUNAL. 7. SHRI Y.K. SUD, LD. COUNSEL FOR THE ASSESSEE SUBM ITTED THAT THE ASSESSEE HAS CLAIMED INCOME OF RS. 3,00,727/- AS EXEMPT U/S 10(23C) (IIIAC) / 10(23C ) (IIIAE) IN ITS RETURN OF INCOME. HE FURTHER SUBMIT TED THAT THE ASSESSEE SOCIETY IS A REGISTERED SOCIETY UNDER THE SOCIETIES ACT, 1860 AND WAS CONSTITUTED WITH THE OBJECTIVES TO ACT AS AN AUTONOMOUS AND INDEPENDENT BODY IN THE HOSPITAL FOR STRENGTHENING OF EXISTING FACILITIES FOR TREATMENT, TO DECIDE THE PURCHASE OF EQUIPMENT RAISING RESOURCES IN ADDITION TO THE GRAN TS GIVEN BY THE GOVERNMENT 8 AS IT CAN LEVY USER CHARGES ON VARIOUS SERVICES AND FACILITIES PROVIDED AT THE HOSPITAL. THE SOCIETY IS EMPOWERED TO RETAIN THE RE VENUE SO COLLECTED AND UTILIZE IT FOR BRINING IMPROVEMENT IN QUALITY AND Q UANTITY OF SERVICES REQUIRED BY THE HOSPITAL AND IMPROVING THE INFRASTRUCTURE, REPA IR AND NEW CONSTRUCTION IN THE HOSPITAL AND ATTACHED BUILDING. HE FURTHER POINTED OUT THAT IN PARA 3.2 OF THE IMPUGNED ORDER, THE ASSESSEE HAS CLAIMED INCOME OF RS. 3,00,727/- AS EXEMPT U/S 10 IN ITS RETURN OF INCOME. SHRI Y.K. SUD, LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT BOTH THE AUTHORITIES BELOW HAVE NOT CONSIDERED AND DECIDED THE CLAIM OF THE ASSESSEE MADE U/S 10 OF THE ACT. HE TH EREFORE, SUBMITTED THAT IMPUGNED ORDER MAY BE SET ASIDE AND THE MATTER MAY BE REMANDED WITH A DIRECTION TO CONSIDER THE CLAIM OF THE ASSESSEE IN ACCORDANCE WITH LAW. SHRI D.S. SIDHU, LD. DR STRONGLY OBJECTED TO THE ABOVE SUBMISSIONS OF THE LD. COUNSEL FOR THE ASSESSEE. 8. I HAVE CONSIDERED THE RIVAL SUBMISSIONS AND HAVE ALSO PERUSED THE MATERIALS AVAILABLE ON RECORD. IT IS APPARENT FROM THE RECORDS THAT THE ASSESSEE HAS CLAIMED INCOME OF RS. 3,00,727/- AS EXEMPT U/S 10 OF THE ACT IN ITS RETURN OF INCOME. HOWEVER, ON THIS ISSUE NO FINDINGS HAVE BEEN GIVEN BY THE AUTHORITIES BELOW. SHRI Y.K. SUD,LD. COUNSEL FOR TH E ASSESSEE SUBMITTED THAT THE ASSESSEE IS ENTITLED TO EXEMPTION U/S 10(23C) (III AC) OR 10(23C) (IIIAE). THE RELEVANT FACTS RELATING TO THIS ISSUE ARE NOT AVAIL ABLE ON RECORD. IN THE ABSENCE OF THE RELEVANT FACTS, IT IS NOT POSSIBLE TO APPRECIAT E THE CLAIM MADE BY THE ASSESSEE. THEREFORE, CONSIDERING THE ENTIRE FACTS OF THE PRESENT CASE, I THINK IT PROPER TO SET ASIDE THE IMPUGNED ORDER AND REMAND T HE MATTER TO THE ASSESSING OFFICER WITH A DIRECTION TO DECIDE THIS LIMITED IS SUE AS TO WHETHER THE ASSESSEE IS ENTITLED TO EXEMPTION CLAIMED U/S 10(23C) (IIIAC) O R 10(23C)(IIIAE) OF THE ACT. THE ASSESSING OFFICER IS DIRECTED TO DECIDE THE ISS UES IN ACCORDANCE WITH LAW. NEEDLESS TO SAY THAT ASSESSING OFFICER WILL OFFER A N OPPORTUNITY OF BEING HEARD TO THE ASSESSEE IN THE MATTER 9 9. FOR STATISTICAL PURPOSES, THE APPEAL IS ALLOWED. ITA NO. 556/CHD/2015 10. IN THIS APPEAL, THE ASSESSEE HAS RAISED THE FOL LOWING GROUNDS:- 1. THAT THE CIT(A) WAS NOT JUSTIFIED IN SUSTAINI NG THE ACTION OF THE ITO IN ASSESSING THE INCOME OF RS. 277270/ - AGAINST THE NIL INCOME DECLARED BY THE ASSESSEE. 2. THAT THE CIT(A) HAS WRONGLY UPHELD THE ACTION OF THE ITO OF DENIAL OF THE EXEMPTION CLAIMED BY THE ASSES SEE U/S 10(23C) (IIIAE) AMOUNTING TO RS. 277270/-. 3. THAT CIT(A) FAILED TO APPRECIATE THAT THE ASS ESSEE HAD FULFILLED ALL THE CONDITIONS PRESCRIBED U/S 10(23C) (IIIAE) THEREFORE THE EXEMPTION OUGHT TO HAVE BEEN ALLOWED BY HER WHICH WAS WRONGLY DENIED BY THE ITO. 4. THAT WITHOUT PREJUDICE TO THE GROUNDS RAISED IN 2 & 3 BOTH AO AND CIT(A) FAILED TO APPRECIATE THAT THE GR ANTS RECEIVED BY THE SOCIETY FROM THE GOVT. FOR SPECIFIC PURPOSE COULD NOT BE TREATED AS INCOME OF THE ASSESSEE AND THEREFORE NO TAX COULD BE LEVIED ON THE SAME. 11. IT IS OBSERVED THAT THERE IS A DELAY OF 130 DAY S IN FILING THE APPEAL. THE EXPLANATION GIVEN BY THE ASSESSEE FOR THE DELAY IS SIMILAR IN ITA NO. 555/CHD/2015 RELATING TO ASSESSMENT YEAR 2010-11. FOR THE DETAILED REASONS GIVEN THEREIN, I CONDONE THE DELAY IN FILING THE A PPEAL. 12. AS REGARDS THE MERITS OF THE CASE, THE BRIEF FA CTS ARE THAT ASSESSEE IS A REGISTERED SOCIETY UNDER SOCIETIES REGISTRATION ACT , 1860 AND WAS CONSTITUTED ON 15.2.2008 WITH THE OBJECTIVE TO STRENGTHENING THE E XISTING FACILITIES FOR TREATMENT, TO DECIDE THE PURCHASE OF EQUIPMENT RAIS ING RESOURCES IN ADDITION TO GRANTS GIVEN BY THE GOVERNMENT AS IT CAN LEVY USER CHARGES ON VARIOUS SERVICES 10 AND FACILITIES PROVIDED IN THE HOSPITAL AND ALSO EM POWERED TO RETAIN THE REVENUE SO COLLECTED AND UTILIZE FOR BRINING IMPROVEMENT IN QUALITY AND QUANTITY OF SERVICES RENDERED BY THE HOSPITAL AND IMPROVING INF RASTRUCTURE, REPAIR AND NEW CONSTRUCTION IN THE HOSPITAL AND ATTACHED BUILDING . THE ASSESSING OFFICER OBSERVED THAT REGISTRATION U/S12A WAS NOT AVAILABLE TO THE ASSESSEE FOR THE CURRENT YEAR. HOWEVER, REGISTRATION U/S 12A WAS AVA ILABLE FROM THE ASSESSMENT YEAR 2012-13. THE ASSESSEE CLAIMED INCOME OF RS. 2, 77,274/- AS EXEMPT U/S 10(23C)(IV) IN ITS RETURN OF INCOME. THE ASSESSING OFFICER HELD THAT NO EXEMPTION U/S 10(23C) IS AVAILABLE TO THE ASSESSEE AS THE INCOME TAX RETURN HAS NOT BEEN FURNISHED WITHIN THE PRESCRIBED TIME LIMIT U/S 139(1), NO BOOKS OF ACCOUNT HAVE BEEN MAINTAINED, NO REGISTRATION U/S 1 2A IS AVAILABLE TO THE ASSESSEE. THERE WAS NO APPROVAL OF COMPETENT AUTHO RITY WITH RESPECT TO SECTION 10(23C)(IV) OF THE ACT. THE EXCESS OF THE INCOME AND EXPENDITURE HAS BEEN CAPITALIZED AND CARRIED FORWARDED, THE ASSESSEE HA S NOT MADE INVESTMENT IN THE DEPOSITS AS PER THE PROVISIONS OF SECTION 11(5) AND THUS DISALLOWED THE EXEMPTION SOUGHT BY THE ASSESSEE. 13. ON APPEAL THE CIT(A) REJECTED THE CLAIM OF THE ASSESSEE, OBSERVING AS UNDER:- 5.2 THE ASSESSEE'S CONTENTION THAT SINCE IT IS A S OCIETY FINANCED WHOLLY OR PARTLY BY STATE AND CENTRAL GOVE RNMENT TO PROVIDE MEDICAL FACILITY TO THE POOR AND NEEDY PEOP LE, MERELY BY FORMATION GETS EXEMPTION U/S 10(23C) IS NOT CORR ECT AS ASSESSEE HAS TO BE GRANTED EXEMPTION BY THE CHIEF COMMISSIONER OF INCOME TAX OR DIRECTOR GENERAL SPECIFICALLY. THUS THERE IS NO FORCE IN THE CONTENT ION OF ASSESSEE AND THERE IS NO INFIRMITY IN THE ACTION OF A.O. I.E DENIAL OF BENEFIT OF 10(23C) OR SECTION 11 &12, HEN CE THESE GROUNDS OF APPEAL ARE DISMISSED. 11 14. I HAVE HEARD THE LD. REPRESENTATIVE OF BOTH TH E PARTIES. SHRI Y.K. SUD, LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ASS ESSING OFFICER HAS REJECTED THE CLAIM OF THE EXEMPTION U/S 10(23C) ON THE GROUN D THAT THE ASSESSEE HAS NOT FURNISHED INCOME TAX RETURN WITHIN THE PRESCRIBED T IME LIMIT OF SECTION 139(1) OF THE ACT, AND THAT THE ASSESSEE HAD NOT FURNISHED AN Y AUDIT REPORT IN FORM NO. 10BB. SHRI Y.K.SUD LD. COUNSEL FOR THE ASSESSEE F URTHER SUBMITTED THAT THE LD. CIT(A) HAS STATED THAT FOR CLAIMING EXEMPTION U/S 10(23C), THE ASSESSEE HAS TO BE GRANTED EXEMPTION BY THE COMMISSIONER OF INCO ME-TAX OR DIRECTOR GENERAL OF INCOME TAX. SHRI LD. COUNSEL FOR THE AS SESSEE VEHEMENTLY ARGUED THAT CLAIMING EXEMPTION U/S 10(23C) (IIIAE) OR 10( 23C)(IIIAC) THERE ARE NO SUCH REQUIREMENTS AS ALLEGED BY THE ASSESSING OFFICER AN D THE CIT(A). HE FURTHER SUBMITTED THAT THE PROVISIONS OF THE ABOVE SECTIONS ARE BENEFICIAL FOR THE ASSESSEE AND, THEREFORE, THESE PROVISIONS NEEDS TO BE CONSTRUED LIBERALLY. IT IS OBSERVED THAT AT THE ASSESSMENT STAGE THE ASSESSEE HAD CLAIMED THAT ITS INCOME IS EXEMPT AS PER THE PROVISIONS OF CLAUSE (IV) OF SECT ION 10(23C) OF THE ACT. IN THIS CONTEXT, THE ASSESSING OFFICER OBSERVED THAT T HE ASSESSEE SOCIETY HAS NOT FURNISHED ITS RETURN OF INCOME WITHIN THE PRESCRIBE D TIME LIMIT OF SECTION 139(1) OF THE ACT AND, THEREFORE, THE ASSESSING OFFICER DI SALLOWED THE CLAIM OF THE ASSESSEE. NOW, FOR THE FIRST TIME THE ASSESSEE HAS CLAIMED THAT AUTHORITIES BELOW WERE NOT JUSTIFIED IN DISALLOWING THE EXEMPTION CLA IMED BY THE ASSESSEE U/S 10(23C)(IIIAE) OR SECTION 10(23C) (IIIAC) OF THE AC T. THE LD. COUNSEL FOR THE ASSESSEE REFERRED TO CIRCULAR NO. 14 DATED 11.4.195 5 ISSUED BY CBDT IN WHICH PARA 3 READS AS UNDER:- 3. OFFICERS OF THE DEPARTMENT MUST NOT TAKE ADVANT AGE OF IGNORANCE OF AN ASSESSEE AS TO HIS RIGHTS. IT IS ONE OF THEIR DU TIES TO ASSIST A TAXPAYER IN EVERY REASONABLE WAY, PARTICULARLY IN T HE MATTER OF CLAIMING AND SECURING RELIEFS AND IN THIS REGARD TH E OFFICERS SHOULD TAKE THE INITIATE IN GUIDING A TAXPAYER WHERE PROCE EDINGS OR OTHER PARTICULARS BEFORE THEM INDICATE THAT SOME REFUND O R RELIEF IS DUE TO HIM. THIS ATTITUDE WOULD, IN THE LONG RUN, BENEFIT THE DEPARTMENT FOR IT 12 WOULD CONFIDENCE IN HIM THAT HE MAY BE SURE OF GETT ING A SQUARE DEAL FROM THE DEPARTMENT. ALTHOUGH, THEREFORE, THE RESP ONSIBILITY FOR CLAIMING REFUNDS AND RELIEFS RESTS WITH ASSESSES ON WHOM IT IS IMPOSED BY LAW, OFFICER SHOULD :- (A) DRAW THEIR ATTENTION TO ANY REFUNDS OR RELIEFS TO WHICH THEY APPEAR TO BE CLEARLY ENTITLED BUT WHICH THEY HAVE O MITTED TO CLAIM FOR SOME REASON OR OTHER; (B) FREELY ADVISE THEM WHEN APPROACHED BY THEM AS TO T HEIR RIGHTS AND LIABILITIES AND AS TO THE PROCEDURE TO BE ADOPT ED FOR CLAIMING REFUNDS AND RELIEFS. FURTHER IN THE CASE OF CIT V MAHALAXMI SUGAR MILLS CO. LTD 160 ITR 920, THE HON'BLE SUPREME COURT HELD AS UNDER;- THERE IS A DUTY CAST ON THE INCOME-TAX OFFICER TO APPLY THE RELEVANT PROVISIONS OF THE INDIAN INCOME-TAX ACT FOR THE PUR POSE OF DETERMINING THE TRUE FIGURE OF THE ASSESSEES TAXAB LE INCOME AND THE CONSEQUENTIAL TAX LIABILITY. THAT THE ASSESSEE FAIL S TO CLAIM THE BENEFIT OF A SET-OFF CANNOT RELIEVE INCOME-TAX OFF ICER OF HIS DUTY TO APPLY SECTION 24 IN AN APPROPRIATE CASE. IN VIEW OF THE ABOVE BOARDS CIRCULAR AND THE DECIS ION IT IS THE DUTY OF THE ASSESSING OFFICER TO CONSIDER AND DECIDE THE CONTEN TION OF THE ASSESSEE. IT IS OBSERVED THAT HOSPITAL OR MEDICAL INSTITUTION S WHICH SATISFIES ANY ONE OF THE FOLLOWING TWO CONDITIONS ARE NOT REQUIRED TO APPLY FOR AVAILING EXEMPTION U/S 10(23C) OF THE ACT. 1. WHETHER TOTAL AGGREGATE RECEIPTS DOES NOT EXCEED RS . 1CRORE [COVERED BY SECTION 10(23C)(IIIAE)]: OR, 2. IT IS SUBSTANTIALLY FINANCED BY THE GOVERNMENT [COV ERED BY SECTION 10(23C)(IIIAC)]. 15. IN MY OPINION, THE OBSERVATION MADE IN PARA 5.2 OF THE IMPUGNED ORDER REPRODUCED HEREIN ABOVE ARE NOT SUSTAINABLE. IT IS NOT THE CASE OF THE REVENUE 13 THAT THE AGGREGATE RECEIPTS EXCEEDED RS. 1 CRORE AN D THAT THE SOCIETY WAS NOT SUBSTANTIALLY FINANCED BY THE GOVERNMENT. 16. AFTER CONSIDERING THE RELEVANT FACTS OF THE PRE SENT CASE AND THE SUBMISSIONS MADE ON BEHALF OF THE ASSESSEE I THINK IT PROPER TO SET ASIDE THE ORDER OF CIT(A) IN TOTO ON THIS ISSUE AND REMAND TH E MATTER TO THE ASSESSING OFFICER WITH A DIRECTION TO EXAMINE THE CLAIM OF TH E ASSESSEE IN ACCORDANCE WITH LAW. IF THE ASSESSEE IS FOUND TO BE ENTITLED TO EX EMPTION U/S 10(23C)(IIIAE) OR 10(23C)(IIIAC), THE SAME MAY BE ALLOWED TO THE ASSE SSEE. I DIRECT THE ASSESSING OFFICER TO PROVIDE A REASONABLE OPPORTUNITY OF BEIN G HEARD TO THE ASSESSEE BEFORE DECIDING THE ISSUES. 17. VIDE GROUND NO.4 OF THE APPEAL, THE ASSESSEE HA S ALTERNATIVELY SUBMITTED THAT GRANTS RECEIVED BY THE SOCIETY FROM THE GOVERN MENT FOR SPECIFIED PURPOSES COULD NOT BE TREATED AS INCOME OF THE ASSESSEE AND, THEREFORE, NO TAX CAN BE LEVIED ON THE SAME. SINCE I HAVE RESTORED THE MAIN ISSUE TO THE FILE OF THE ASSESSING OFFICER AND, THEREFORE, I THINK IT APPROP RIATE TO REMAND THIS ISSUE ALSO TO THE ASSESSING OFFICER FOR EXAMINATION AND FRESH ADJUDICATION IN ACCORDANCE WITH LAW. GROUND NO. 4 OF THE APPEAL IS ALSO ALLO WED FOR STATISTICAL PURPOSES. 18. FOR STATISTICAL PURPOSES, THE APPEAL IS ALLOWED . ITA NO. 557/CHD/2015 19. IN THIS APPEAL THE ASSESSEE HAS RAISED THE FOLL OWING GROUNDS:- 1. THAT THE CIT(A) WAS NOT JUSTIFIED IN SUSTAININ G THE ACTION OF THE 1TO IN ASSESSING THE INCOME OF RS. 178510/- AGAINST THE NIL INCOME DECLARED BY THE ASSESSES. 2. THAT THE CIT(A) HAS WRONGLY UPHELD THE ACTION OF THE ITO OF DENIAL OF THE EXEMPTION CLAIMED BY THE ASSESSEE U/S 10(23C) (IIIAE) AMOUNTING TO RS. 178510/-. 14 3. THAT CIT(A) FAILED TO APPRECIATE THAT THE ASSE SSEE HAD FULFILLED ALL THE CONDITIONS PRESCRIBED U/S 10(23C) (IIIAE) THEREFORE THE EXEMPTION OUGHT TO HAVE BEEN ALLOWED BY HER WHICH WAS WRONGLY DENIED BY THE ITO. 4. THAT WITHOUT PREJUDICE TO THE GROUNDS RAISED I N 2 & 3 BOTH AO AND CIT(A) FAILED TO APPRECIATE THAT THE GR ANTS RECEIVED BY THE SOCIETY FROM THE GOVT. FOR SPECIFIC PURPOSE COULD NOT BE TREATED AS INCOME OF THE ASSESSEE AND THEREFORE NO TAX COULD BE LEVIED ON THE SAME. 20. AS REGARDS THE MERITS OF THE CASE, IT IS OBSERVED THAT THE FACTS OF THE PRESENT CASE ARE SIMILAR TO THE FACTS OF THE CASE O F ROGI KALYAN SAMITI, PHC GOPALPUR, VS. ITO IN ITA NO. 556/CHD/2015. THE FIN DINGS GIVEN IN ITA NO. 556/CHD/2015 SHALL APPLY WITH EQUAL FORCE TO THIS A PPEAL ALSO. FOR THE DETAILED REASONS GIVEN THEREIN, THE IMPUGNED ORDER IS SET AS IDE AND MATTER IS REMANDED TO THE FILE OF ASSESSING OFFICER WITH A DIRECTION TO D ECIDE THE ISSUES IN ACCORDANCE WITH LAW AFTER AFFORDING DUE AND REASONABLE OPPORTU NITY OF BEING HEARD TO THE ASSESSEE. 21. FOR STATISTICAL PURPOSES, THE APPEAL IS ALLOWED . ORDER PRONOUNCED IN THE OPEN COURT ON 17.09.2015 SD/- (H.L.KARWA) VICE PRESIDENT DATED : 17 TH SEPT., 2015 RKK COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT(A) 5. THE DR 15