Growup Society, Dehradun V. CIT(E), Lucknow

ITA 5583/DEL/2015

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 4889 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 11 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-08-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: misc
• Appeal Filed On: 28-09-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NAVEEN CHANDRA
• Keywords: Charitable institution; Opportunity of being heard; Principle of natural justice
• Section: 80G; 12A; 12AA; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI C BEN CH, NEW DELHI BEFORE SHRI B.P. JAIN, ACCOUNTANT MEMBER AND SHRI KULDIP SINGH, JUDICIAL MEMBER. ITA NO. 5583/DEL/2015 GROW UP SOCIETY VS. THE CIT[EXEMPTION] GRAM MATAI P.O. MATAL LUCKNOW NANDPRAYAG DIST. CHAMOLI UTTARAKHAND PAN : AABAG 5187 A [APPELLANT] [RESPONDENT] DATE OF HEARING : 29.08.2017 DATE OF PRONOUNCEMENT : 30.08.2017 ASSESSEE BY : SHRI ANUBHAV JAI N, CA SHRI VINAY K. DAGH, ADV REVENUE BY : SHRI NAVEEN CHANDRA, CIT-DR ORDER PER B.P. JAIN, ACCOUNTANT MEMBER: THIS APPEAL OF THE ASSESSEE ARISES FROM THE ORDER OF THE LD. CIT(E), VIDE ORDER DATED 23.07.2015 PASSED U/S 12A A(1)(B)(II) OF THE INCOME-TAX ACT, 1961 [HEREINAFTER REFERRED TO AS 'T HE ACT' FOR SHORT]. - 2- ITA NO. 5583/DEL/2015 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: (I) 1. THAT THE LD. C.I.T.(EXEMPTIONS), LUCKNOW HAS ERRED IN LAW AND ON FACTS IN REJECTING THE APPLICATION FOR GRANT OF REGISTRATION UNDER SECTION 12AA OF THE INCOME TAX ACT, 1961, VID E HIS EX-PARTE ORDER DATED 23.07.2015. (II) THAT THE LD. C.I.T.(EXEMPTIONS), LUCKNOW HAS ALSO ERRED IN LAW AND ON FACTS IN PASSING AN EX-PARTE ORDER DATED 23. 07.2015 U/S 12AA (L)(B) (II) OF THE INCOME TAX ACT 1961, MERELY ON THE NON- APPEARANCE BY THE APPELLANT ON THE VERY FIRST DATE OF HEARING AND WITHOUT PROVIDING REASONABLE & SUFFICIENT OPPORTUNI TY OF BEING HEARD TO THE APPELLANT SOCIETY. (III) THAT THE IMPUGNED ORDER PASSED BY THE LD. C.I.T.(E XEMPTIONS), LUCKNOW U/S 12AA OF THE INCOME TAX ACT, 1961 DATED 23.07.2015 IS CONTRARY TO THE PRINCIPLES OF NATURAL JUSTICE AN D EQUITY AND DESERVES TO BE QUASHED. (IV) THAT WHILE REJECTING THE APPLICATION FOR GRANT OF REGISTRATION SOUGHT BY THE APPELLANT SOCIETY, VIDE HIS EX-PARTE ORDER DATED 23.07.2015, THE LD. C.I.T.(EXEMPTIONS), LUCKNOW HAS MISDIRECTED HIMSELF IN NOT CONSIDERING THE FACTS ON RECORD AND FAILED TO APPRECIATE THAT THE OBJECTS OF THE SOCIETY ARE ONLY CHARITABLE ACTIVITIES AS DEFINED IN SECTION 2(15) OF THE INCO ME TAX ACT, 1961. (V) THAT ANY OTHER RELIEF OR RELIEFS AS MAY BE DEEMED F IT ON THE FACTS OF THE CASE, BE GRANTED. - 3- ITA NO. 5583/DEL/2015 3. BRIEF FACTS OF THE CASE ARE THAT ORDER IN THE PR ESENT CASE HAS BEEN PASSED BY THE LD. CIT(E) EXPARTE. IT IS RELEV ANT TO REPRODUCE THE ORDER OF THE LD. CIT(E) WHICH READS AS UNDER: THE ABOVE NAMED SOCIETY HAS FILED AN APPLICAT ION FOR REGISTRATION U/S 12AA OF THE INCOME TAX ACT, 1961 O N 09.02.2015 WITH THE COMMISSIONER OF INCOME TAX (EXEMPTIONS), L UCKNOW. 2. SUBSEQUENTLY, THE APPLICANT SOCIETY WAS ACCORDED AN OPPORTUNITY OF BEING HEARD VIDE THIS OFFICE LETTER F.NO. CIT(EXEMP,)/LKO/REGISTRATION U/S 12AA & 80G /2015-I 6 DATED 29.05.2015 SENT TO THE APPLICANT BY SPEED POST, CAL LING FOR SPECIFIC QUERIES REGARDING ITS APPLICATION FOR REGI STRATION U/S 12A FOR 11.06.2015. HOWEVER, ON THAT DATE I.E. NO ONE A PPEARED ON 11.06.2015 NOR ANY APPLICATION FOR ADJOURNMENT WAS RECEIVED. A LETTER F. NO. CIT(EXEMP.)/LKO/REGISTRAT ION U/S 12AA & 8OG/2015-16 DATED 11.06.2015 SENT TO THE APP LICANT FOR FIXING ANOTHER DATE OF HEARING I.E 19.06.2015. HOWE VER, ON THAT DATE I.E. 19.06.2015 NO ONE APPEARED ON 19.06.201S NOR ANY APPLICATION FOR ADJOURNMENT WAS RECEIVED. THEREAFTE R ON 10.07.2015, A LETTER FOR GRANTING AN OPPORTUNITY OF HEARING ON 23.07.2015 WAS SENT BY SPEED POST [RECEIPT NO. EU14 26S6165IN), AND DULY SERVED ON THE APPLICANT. HOWEVER, NO ONE A PPEARED ON 23.07.2015 NOR ANY APPLICATION FOR ADJOURNMENT WAS RECEIVED. THE APPLICANT IS WELL AWARE THAT THIS APPLICATION W ILL GET BARRED BY LIMITATION ON 31.07.2015, STILL NO COMPLIANCE HA S BEEN MADE BY APPLICANT. - 4- ITA NO. 5583/DEL/2015 3. I HAVE CONSIDERED THE MATERIAL AVAILABLE ON REC ORDS. ON PERUSAL OF MATERIAL AVAILABLE, IT IS SEEN THAT THE APPLICANT SOCIETY IS NOT CARRYING OUT ANY CHARITABLE ACTIVITI ES. AS PER PROVISION OF SECTION 12AA(1)(B) OF THE ACT, TWO FAC TORS NAMELY THE OBJECT OF CHARITABLE PURPOSE AND THE GENUINENES S OF ACTIVITIES HAVE TO BE PROVED BEFORE GRANTING THE RE GISTRATION. HOWEVER, THE APPLICANT FAILED TO PROVE THE SAME. HE NCE, THE APPLICANT SOCIETY HAS NOT MADE OUT A CASE FOR GRANT ING THE REGISTRATION U/S 12AA(1)(B). 4. SECTION 13(1)(C) OF THE IT.ACT, 1961 PROVIDES TH AT WHERE A PART OF INCOME OF CHARITABLE AND RELIGIOUS TRUST OR INSTITUTIONS ENSURES OR IS USED OR APPLIED DIRECTLY OR INDIRECTL Y FOR THE BENEFIT OF THOSE PERSONS SPECIFIED IN SECTION 13(3) , THAT A TRUST OR INSTITUTIONS FORFEITS THE EXEMPTIONS U/S 11 EVEN IF ONLY A SMALL PORTION OF MONEY IS UTILIZED OR USED OR APPLI ED FOR BENEFIT OF A PERSON MENTIONED IN SECTION 13(3) AND ACCORDIN GLY THE TRUST DENIED THE EXCLUSION. IN VIEW OF THE FACTS AND ABOVE DECISIONS, I AM UNA BLE TO ACCEPT THE APPLICANT'S CLAIM IN ABSENCE OF SUFFICIENT MATE RIAL REQUIRED FOR FORMATION OF SATISFACTION. THEREFORE, I DO NOT FIND THE CASE FIT FOR GRANT OF REGISTRATION U/S 12A(1) OF THE INC OME-TAX ACT, 1961. 12. ACCORDINGLY, THE REGISTRATION SOUGHT BY THE APP LICANT U/S 12A(1) OF THE INCOME-TAX ACT, 1961 IS HEREBY REJECT ED. - 5- ITA NO. 5583/DEL/2015 4. IT WAS ARGUED BY THE LD. COUNSEL FOR THE ASSESSE E THAT SERVICE OF NOTICE AND DATE OF HEARING PLACED ON RECORD INDICAT E THAT THE NOTICES WERE RECEIVED BY THE ASSESSEE AFTER THE DATES FIXED FOR HEARING AND, THEREFORE, THERE IS GENUINE CAUSE FOR NOT BEING ABL E TO COMPLY WITH THE NOTICE. ACCORDING TO THE LD. COUNSEL FOR THE ASSES SEE, THE ORDER OF THE LD. CIT(E) IS NOT IN ACCORDANCE WITH THE PRINCIPLES OF NATURAL JUSTICE AND DESERVE TO BE QUASHED. 5. THE LD. DR, ON THE OTHER HAND, RELIED UPON THE O RDER OF THE LD. CIT(E) AND CONTENDED THAT THE LD. CIT(E) HAS GIVEN AMPLE OPPORTUNITIES TO THE ASSESSEE WHO DID NOT BOTHER TO APPEAR. 6. WE HAVE HEARD THE PARTIES AND PERUSED THE FACTS OF THE CASE. FROM THE SEQUENCE OF NOTICES ISSUED FOR HEARING AND DATE OF SERVICE OF NOTICE, AS PER ANNEXURE 1, PLACED ON RECORD BY TH E LD. COUNSEL FOR THE ASSESSEE, IT IS EVIDENT THAT THE ASSESSEE HAS BEEN SERVED THE NOTICES MOSTLY AFTER DUE DATE OF HEARING. IN ANY CASE, THE ASSESSEE HAS NOT SUBMITTED ANY DOCUMENTARY EVIDENCE IN SUPPORT OF HI S APPLICATION FILED FOR REGISTRATION U/S 12AA OF THE ACT AND THE ORDER PASSED IS EX PARTE ORDER BY THE LD. CIT(E). THEREFORE, IN THE INTERES T OF JUSTICE, ONE MORE OPPORTUNITY IS REQUIRED TO BE GIVEN TO THE ASSESSEE WHO SHALL COOPERATE IN THE PROCEEDINGS BEFORE THE LD. CIT(E) AND NO UNN ECESSARY - 6- ITA NO. 5583/DEL/2015 ADJOURNMENT SHALL BE AVAILED FROM THE LD. CIT(E). THUS, THE ORDER OF THE LD. CIT(E) IS SET ASIDE TO THE FILE OF THE LD. CIT(E) WHO IS DIRECTED TO DECIDE THE ISSUE DE NOVO BY AFFORDING ADEQUATE OPPO RTUNITY OF BEING HEARD TO THE ASSESSEE. THUS, GROUNDS RAISED BY THE ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED FOR STATISTICAL PURPOSES. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 30.08. 2017. SD/- SD/- [KULDIP SINGH] [B.P. JAIN] JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 30 TH AUGUST, 2017 VL/ COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR ASST. REGISTRAR, ITAT, NEW DELHI