SDPS Trust, Noida V. CIT(E), Lucknow

ITA 5567/DEL/2015

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 4617 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 11 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-09-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: misc
• Appeal Filed On: 24-09-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: GAUTAM KUMAR BASU CHAIRMAN
• Keywords: Charitable institution; Opportunity of being heard
• Section: 80G; 12A; 12AA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI C BENCH, NEW DELHI BEFORE SHRI B.P. JAIN, ACCOUNTANT MEMBER AND SHRI K ULDIP SINGH , JUDICIAL MEMBER. ITA NO . 5 567 /DEL/20 1 5 SDPS TRUST VS. THE C IT [E] FLAT C 96, POCKET - 1 LUCKNOW KENDRIYA VIHAR 2, SECTOR 82 NOIDA PAN : AA NTS 4310 A [APPELLANT] [RESPONDENT] DATE OF HEARING : 3 0 .08.2017 DATE OF PRONOUNCEMENT : 19 .0 9 .2017 ASSESSEE BY : SHRI GAUTAM KUMAR BASU, CHAIRMAN REVENUE BY : SHRI ARUN KUMAR YADAV , SR. DR ORDER PER B. P. JAIN, ACCOUNTANT MEMBER: THIS APPEAL OF THE ASSESSEE ARISES FROM TH E ORDER OF THE LD. CIT( E ) , LUCKNOW VIDE ORDER DATED 13 D .09.2015 PASSED U/S 12AA(1)(B)(II) OF THE INCOME - TAX ACT, 1961 [HEREINAFTER REFERRED TO AS 'THE ACT' FOR SHORT] . 2. FACTS IN BRIEF ARE THAT APPELLANT SOCIETY HAS FILED AN APPLICATION FOR REGISTRATION U/S 12A(A) OF THE I NCOME TAX ACT, 1961 ON 16 .0 1 .2015 WITH THE COMMISSIONER OF INCOME TAX(EXEMPTIONS), - 2 - ITA NO. 5567 /DEL/201 5 LUCKNOW. SUBSEQUENTLY, THE APPLICANT SOCIETY WAS ACCO RDED AN OPPORTUNITY OF BEING HEARD V I D E LETTER F.NO. CIT (EXEMP.) / LKO/REGISTRATION U/S 12AA & 80G /2015 - 16/3198 DATED 1 8 .0 5 .2015 SENT TO T H E APPLICANT ON ADDRESS PROVIDE D BY HIM BY SPEED POST, CALLING FOR SPECIFIC QUERIES REGARDING ITS APPLICATIO N FOR REGISTRATION U/S 12A FOR 1 3.0 7 .2015, HOWEV ER, ON THAT DATE I.E. 1 3.0 7 .2015 NO ONE APPEARED, NO R ANY APPLICATION FOR ADJOURNM ENT WAS RECEIVED. THE APPLICANT WA S WELL AWARE THAT THIS APPLICATION WILL GET BARRED BY L IMITATION SHORTLY, STILL NO COMPLIANCE HAS BEE N M ADE BY APPLICANT. 3. AFTER CONSIDE R ING THE MATERIAL AVAILABLE ON R ECORD , THE LD. CIT(E) OBSERVED THAT THE APPLICANT SOCIETY COULD NOT PRODUCE THE BOOKS AND VOUC HERS IN R ESPECT OF EXPENSES CLAIMED BY THE APPLICANT FOR VERIFICATION OF ACTIVITIES OF THE TRUST. ON PERUSAL OF MA TERIAL AVAILABLE ON RECORD, IT WA S SEEN THAT THE APPLICANT SOCIETY WAS NOT CARRYING OUT ANY CHARITABLE ACTIVITIES. DUE TO THE FACT OF NOT PRODUCING THE BOOKS OF ACCOUNTS AND VOUCHERS BY THE APPLICANT, THE GENUINENESS OF ACTIVITIES COULD NOT BE VERIFIED. AS PER PROVISION O F SECTION 12AA( 1 )(B) OF THE ACT, TWO FACTORS NAMELY , THE OBJECT OF CHARITABLE PURPOSE AND THE GENUINENESS OF ACTIVITIES HAVE TO BE PROVED BEFORE GRANTING THE REGISTRATION. HOWEVER, THE APPLICANT FAILED TO PROVE THE SAME. THE LD. - 3 - ITA NO. 5567 /DEL/201 5 CIT(E) OBSERVED THAT THE AS SESSEE APPEARS TO BE RUNNING THE ACTIVITIES PURELY ON COMMERCIAL LINES FOR PROFIT MOTIVE. HENCE, THE APPLICANT SOCIETY HAS NOT MADE OUT A CASE FOR GRAN TING THE REGISTRATION U/S 12AA(1 )(B). IT WA S CLEAR THAT SUFFICIENT MATERIAL REQUIRED FOR SATISFACTION RE GARDING CHARITABLE PURPOSE OF THE TRUST IN THIS CASE HAS NOT BEEN MADE AVAILABLE BY THE APPLICANT. IN VIEW OF THE FACTS AND ABOVE DECISIONS, THE LD. CIT(E) DID NOT ACCEPT THE APPLICANT'S CLAIM IN ABSENCE OF SUFFICIENT MATERIAL REQUIRED FOR FORMATION OF SA TISFACTION. THEREFORE, HE DID NOT FIND THE CASE FIT FOR GRANT OF REGISTRATION U/S 12A(1) OF THE INCOME - TAX ACT, 1961 AND REJECTED THE SAME. 4. FROM THE PERUSAL OF THE SAID ORDER OF THE LD. CIT(E), IT IS EVIDENT THAT THE DATE OF THE ORDER IN THE PRES ENT CA SE IS 13 .0 7 .2015. THE CASE WAS ADJOURNED FOR 18 .0 5 .2015 , 25.06.2015 AND 13.07.2015 ON WHICH DATE IT WAS ALLEGED THAT NO ONE APPEARED ON BEHALF OF THE ASSESSEE AND THE LD. CIT(E) REACHED TO A CONCLUSION THAT THERE IS NO SUFFICIENT MATERIAL ON RECORD THAT THE ASSESSEE IS AN INSTITUTION BEING CARRIED ON FOR CHARITABLE PURPOSES. THE LD. CIT( E ) FURTHER OBSERVED THAT IT IS NOT A FIT CASE FOR GRANT OF REGISTRATION U/S 12AA(1) OF THE ACT. - 4 - ITA NO. 5567 /DEL/201 5 5. AFTER HEARING TH E PARTIES, WE FIND THAT NO SHOW CAUSE NOTICE WAS GIVEN TO THE ASSESSEE BY THE LD. CIT(E) WITH REGARD TO THE PASSING OF THE ORDER AND ON THE DATE OF HEARING I.E. 13 .0 7 .2015 WHEN NONE APPEARED ON BEHALF OF THE ASSESSEE, HE PASSED THE ORDER WITHOUT PROVIDING ANY ADEQUATE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. SINCE U/S 12AA(II) THE CASE GETS TIME BARRED ON 3 1 .0 7 .2015 AND IN THE ABSENCE OF ANY SHOW CAUSE NOTICE TO THE ASSESSEE THE CASE WAS DECIDED BY THE LD. CIT(E) WITHOUT AFFORDING ADEQUATE OPPORTUNITY O F BEING HEARD TO THE ASSESSEE. WE FIND IT APPROPRIATE TO REPRODUCE THE RELEVANT PROVISIONS U/S 12AA(II) OF THE ACT AS HEREINBELOW: EVERY ORDER GRANTING OR REFUSING REGISTRATION UNDER CLAUSE (B) OF SUB SECTION(1) SHALL BE PASSED BEFORE THE EXPIRY OF SIX MONTHS FROM THE END OF THE MONTH IN WHICH THE APPLICATION WAS RECEIVED UNDER CLAUSE (A) OF SECTION 12A . 6. IN VIEW OF THE ABOVE FACTS AND CIRCUMSTANCES OF THE CASE AND IN THE INTEREST OF JUSTICE, THE MATTER IS SET ASIDE TO THE FILE OF THE LD. CIT(E) WITH THE DIRECTION TO DECIDE THE CASE DE NOVO. NEEDLESS TO MENTION THAT ADEQUATE OPPORTUNITY OF BEING HEARD WILL BE AFFORDED TO THE ASSESSEE. ACCORDINGLY, THE SOLE GROUND RAISED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. - 5 - ITA NO. 5567 /DEL/201 5 7 . IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES . THE ORDER IS PRONOU NCED IN THE OPEN COURT ON 19 .0 9 .2017. SD/ - SD/ - [K ULDIP SINGH ] [B.P. JAIN] JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 19 TH SEPTEMBER , 2017 V L/ COPY FORWARDED TO: 1 . APPELLANT 2 . RESPONDENT 3 . CIT 4 . CIT(A) 5 . DR ASST. REGISTRAR, ITAT, NEW DELHI