M/s Kund Kund Pravachan Prasaran Sansthan, Ujjain V. The Commissioner of Income Tax (Adm), Ujjain

ITA 611/IND/2010

• Counselvise Citation: 61122714 RSA 2010
• Duration Of Justice: 10 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-10-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: misc
• Appeal Filed On: 24-11-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ARUN DEWAN
• Keywords: Charitable institution; Competent authority
• Section: 12A; 12AA; 12

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, INDORE BENCH, INDORE BEFORE SHRI JOGINDER SINGH, J.M. AND SHRI R.C.SHARM A, A.M. PAN NO. : AAATK6588R I.T.A.NO. 611/IND/2010 KUND KUND PRAVACHAN PRASARAN SANSTHAN, COMMISSIONER OF INCOME- TAX, UJJAIN VS BHOPAL. APPELLANT RESPONDENT APPELLANT BY : SHRI PRAKASH JAIN, C. A. RESPONDENT BY : SHRI ARUN DEWAN, SR. DR DATE OF HEARING : 17.10.2011 DATE OF PRONOUNCEMENT : 20.10.2011 O R D E R PER R. C. SHARMA, A.M. THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF CIT, UJJAIN, DATED 05.10.2010 U/S 12A/12AA OF TH E INCOME- TAX ACT, 1961. 2. FOLLOWING GROUNDS OF APPEAL HAVE BEEN TAKEN BY THE ASSESSEE :- -: 2: - 2 1. THAT IMPUGNED ORDER PASSED BY THE LD. CIT (ADM) IS BAD IN LAW AS WELL AS ON THE FACTS. IT IS BASED ON INCORRECT INTERPRETATION OF LAW AND THE FACTS HAVE ALSO BEEN INCORRECTLY CONSTRUED. 2. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE , THE LD. CIT (ADM) ERRED IN REFUSING REGISTRATION U/S 12AA OF THE INCOME-TAX ACT W.E.F. 1.4.2000 WITHOUT FOLLOWING DIRECTION OF HON'BLE HIG H COURT BY ASSIGNING THE REASON THAT APPLICATION DATED 23.3.2001 WAS NOT DIRECTLY FILED BEFORE THE CIT(ADM), BHOPAL, AND THUS NO SUCH APPLICATION WAS PENDING BEFORE THE COMPETENT AUTHORITY INSPITE OF THE FACT THAT THE APPLICATION DATED 23.3.2001 WA S DULY FILED THROUGH JT. CIT, UJJAIN, AS PER THE PREVALENT PRACTICE AT THAT TIME. 3. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE , THE LD. CIT (ADM) ERRED IN NOT MAKING ANY COMMENT THAT WHERE THE APPLICATION FOR GRANT OF REGISTRATION U/S 12AA FILED ON 23.3.2001 DULY -: 3: - 3 ACKNOWLEDGED BY THE DEPARTMENT HAVE GONE/MISPLACED. 3. RIVAL CONTENTIONS HAVE BEEN HEARD AND RECORDS PERUSED. BRIEF FACTS ARE THAT THE ASSESSEE WHICH IS A RELIGIOUS TRUST HAD MADE AN APPLICATION FOR REGISTRATION U/S 12A OF THE INCOME-TAX ACT, ON 23.3.2001 TO THE CIT, M.P., BHOP AL. THE TRUST IS LOCATED AT UJJAIN BUT DURING THE RELEVANT TIME THE OFFICE OF CIT WAS NOT AT UJJAIN AND IT WAS UNDER TH E JURISDICTION OF CIT, BHOPAL, THEREFORE, THE APPLICATION WAS MADE TO CIT, BHOPAL. SUBSEQUENTLY THE OFFICE OF CIT, UJJAIN CAME INTO EXISTENCE ON 01.06.2001. THE PROVISION OF THE ACT R EQUIRES THE AUTHORITY TO PASS AN ORDER ACCEPTING OR REFUSING RE GISTRATION WITHIN SIX MONTHS, BUT NO DECISION ON THE ASSESSEE S APPLICATION FOR REGISTRATION WAS TAKEN AND THE ASSE SSEE PROCEEDED ON THE BASIS THAT THE REGISTRATION WAS GR ANTED TO IT. THE ASSESSEE SUBMITTED APPLICATION ON 30.4.03 TO TH E CIT, UJJAIN MAKING A REQUEST TO ALLOT THE REGISTRATION N UMBER AND ISSUE REGISTRATION CERTIFICATE. THE CIT, UJJAIN VID E COMMUNICATION DATED 10.6.03 CLOSED THE APPLICATION AND INFORMED THAT THE APPLICATION DATED 23.3.01 SHOULD HAVE BEEN -: 4: - 4 SUBMITTED TO CIT, UJJAIN AND THE CIT, BHOPAL, HAD N O JURISDICTION. THE ASSESSEE BY WAY OF ABUNDANT CAUTI ON FILED ANOTHER APPLICATION ON 19.8.08 BEFORE THE CIT, UJJA IN, MAKING A REQUEST FOR REGISTERING THE TRUST U/S 12 A OF THE ACT. THE CIT, UJJAIN, BY ORDER DATED 19.2.09 REJECTED ASSESS EES APPLICATION DATED 19.8.08 HOLDING THAT ASSESSEE TRU ST IS A RELIGIOUS AND CHARITABLE TRUST AND ITS OBJECT ARE F OR THE BENEFIT OF PARTICULAR COMMUNITY AND THE PROVISIONS OF SECTI ON 13(1)(B) ARE APPLICABLE. ASSESSEE PREFERRED APPEAL BEFORE TH E APPELLATE TRIBUNAL AGAINST THE ORDER OF CIT(APPEALS). THE TRI BUNAL VIDE ORDER DATED 10.8.09 HELD THAT ASSESSEE IS A PUBLIC RELIGIOUS TRUST AND THE ACTION OF CIT IN REFUSING TO GRANT RE GISTRATION TO THE ASSESSEE TRUST ON THE GROUND OF VIOLATION OF TH E PROVISIONS OF SECTION 13(1)(B) OF THE ACT IS NOT JUSTIFIED. TH E EFFECT OF THE ORDER OF THE TRIBUNAL IS THAT ASSESSEE BECOME ENTIT LED FOR REGISTRATION ON THE BASIS OF THE APPLICATION SUBMIT TED ON 19.8.08, BUT, ASSESSEES CLAIM FOR REGISTRATION ON THE BASIS OF APPLICATION DATED 23.3.01 WAS REJECTED BY REFERRING TO COMMUNICATION DATED 10.6.03. -: 5: - 5 4. AGAINST THIS ORDER OF THE TRIBUNAL DATED 10.8.2009, FOR NOT ALLOWING THE REGISTRATION TO ASSESSEE TRUST W.E .F. 1.4.2001 WITH RESPECT TO ITS APPLICATION DATED 23.3.2001, TH E ASSESSEE APPROACHED TO THE HON'BLE HIGH COURT, WHEREIN HIGH COURT OBSERVED AS UNDER VIDE ORDER DATED 28.2.2010 :- 8. A PERUSAL OF THE RECORD INDICATES THAT THE DEPARTMENT HAS NOT DISPUTED THE FACT OF SUBMISSION OF APPLICATION FOR REGISTRATION DATED 23.3.01. IT I S ALSO NOT DISPUTED THAT WHEN THE APPLICATION WAS SUBMITTED AT THAT TIME, CIT, BHOPAL, HAD JURISDICTION OVER UJJAIN. THEREFORE, EITHER CIT BHO PAL SHOULD HAVE DECIDED THE APPELLANTS APPLICATION DATED 23.3.01 OR IT SHOULD HAVE TRANSFERRED THE SAME ON COMING INTO EXISTENCE OF CIT, UJJAIN BUT NOTHING WAS DONE. THE APPELLANT CANNOT BE MADE TO SUFFER DUE TO INACTION ON THE PART OF THE DEPARTMEN T. THE COMMISSIONER WAS REQUIRED TO DISPOSE OFF THE APPLICATION DATED 23.3.01 BY FOLLOWING THE PROCEDURE PRESCRIBED U/S 12AA OF THE ACT. -: 6: - 6 9. THE PLEA RAISED BY THE APPELLANT THAT ITS APPLICATION DATED 23.3.01 HAS NOT BEEN DECIDED IS NOT CONSIDERED BY THE TRIBUNAL PROPERLY. THE TRIBUNAL REJECTED THIS PLEA MERELY BY REFERRING THE COMMUNICATION DATED 10.6.2003. BY THE COMMUNICATION DATED 10.6.03, THE APPLICATION DATED 30.4.03 WAS CLOSED BUT BY THIS COMMUNICATION EARLIER APPLICATION DATED 23.3.01 WAS NOT REJECTED. WHILE ISSUING THE COMMUNICATION DATED 10.6.03, THE COMMISSIONER DID NOT CONSIDER THE FACT THAT ON THE DATE OF MAKING OF THE APPLICATION DATED 23.3.01, CIT, BHOPAL HAD THE JURISDICTION AND THAT THE APPLICATION DATED 23.3.01 WAS NEVER REJECTED BY THE CIT, BHOPAL, ON THE GROUND OF JURISDICTION OR ON AN Y OTHER GROUND. 10. THOUGH, THE TRIBUNAL HAS RECORDED A FINDING THAT IT IS A PUBLIC RELIGIOUS TRUST AND HAS SET ASI DE THE ORDER OF CIT REFUSING TO GRANT OF REGISTRATION, BUT ISSUE RELATING TO ENTITLEMENT OF THE APPELLANT FOR REGISTRATION ON THE BASIS OF APPLICATION DATED -: 7: - 7 23.3.01 HAS NOT BEEN EXAMINED IN CORRECT PERSPECTIVE EITHER BY THE COMMISSIONER OR BY THE TRIBUNAL. THE EFFECT OF THE ORDER OF TRIBUNAL IS TH AT THE APPELLANT WILL BE ISSUED THE REGISTRATION CERTIFICATE U/S 12A/12AA OF THE ACT ON THE BASIS OF THE APPLICATION DATED 19.8.08, BUT, SO FAR AS THE APPELLANTS CLAIM IN RESPECT OF REGISTRATION ON THE BASIS OF APPLICATION DATED 23.3.01 IS CONCERNED, TH E SAME REMAINED UNDECIDED. 11. THUS, IN THE BACKGROUND OF THE AFORESAID FACTS, THE QUESTION FORMULATED BY THIS COURT ABOVE IS ANSWERED IN AFFIRMATIVE BY REMANDING THE MATTER TO THE CIT, UJJAIN, WITHOUT DISTURBING THE FINDING OF THE TRIBUNAL IN RESPECT OF THE RELIGIOUS NATURE OF THE ASSESSEE TRUST, BUT BY SETTING ASIDE THAT PART OF T HE ORDER OF THE TRIBUNAL BY WHICH TRIBUNAL DECIDED GROUND NO. 3 RELATING TO APPLICATION DATED 23.3.01. THE CIT, UJJAIN, IS DIRECTED TO DECIDE THE CLAIM OF THE ASSESSEE ON MERIT FOR GRANT OF REGISTRATION UNDER SECTION 12A/12AA ON THE BASIS OF ITS APPLICATION -: 8: - 8 DATED 23.3.01. IF CIT, UJJAIN FINDS THAT THE APPLICATION DATED 23.3.01 WAS NOT TRANSFERRED TO IT , IT WILL BE OPEN TO CIT, UJJAIN TO SUMMON THE CONCERNED RECORD FROM THE OFFICE OF CIT, BHOPAL, RELATING TO THE APPLICATION DATED 23.3.01. 5. THE CIT, UJJAIN, VIDE ORDER DATED 5.10.10, HELD TH AT THERE WAS NO APPLICATION FILED BY THE ASSESSEE ON 2 3.3.01 BEFORE THE COMPETENT AUTHORITY, THEREFORE, THE CLAI M FOR ADJUDICATING THE MERITS OF THE CASE AS PER THE DIRE CTION OF THE HON'BLE COURT DOES NOT ARISE. THE LD. AUTHORIZED REPRESENTATIVE DREW OUR ATTENTION TO THE LETTER DAT ED 11.7.2011 NO.1697 WRITTEN BY THE CIT, UJJAIN TO THE ASSESSEE WHICH READS AS UNDER :- F.NO. CIT/UJN/TECH/UJN/11-12/1697 DATE : 11.07.20 11 THE MANAGING TRUSTEE, KUND KUND PRAVACHAN PRASARAN SANSTHAN, SHREE MAHAVEER DIGAMBER JAIN MANDIR, 197/198 CHIMANGANJ MANDI, UJJAIN (MP) SIR, SUB : YOUR APPLICATION DATED 5.7.11 REQUESTING COPY OF APPLICATION FOR REGISTRATION U/S 12A ADDRESSED TO CIT, BHOPAL, -: 9: - 9 SUBMITTED ON 23.3.2001- REGARDING. PLEASE REFER TO THE ABOVE. AS REQUESTED BY YOU, PLEASE FIND ENCLOSED HEREWITH COPY OF APPLICATION FOR REGISTRATION U/S 12A OF THE ACT ADDRESSED TO CIT, BHOPAL, ALONGWITH ITS ENCLOSURES SUBMITTED ON 23.03.2001. YOURS FAITHFULLY, SD (DILIP APTE ) INCOME-TAX OFFICER (TECH.) ENCL:AS ABOVE. FOR CIT, UJJAIN. 6. ORIGINAL COPY OF THE ABOVE LETTER WAS ALSO PLACED B EFORE THE BENCH. AFTER GOING THROUGH THE CONTENTS OF THIS LETTER, IT IS CLEAR THAT APPLICATION FOR REGISTRATION U/S 12A WAS SUBMITTED BY ASSESSEE BEFORE COMPETENT AUTHORITY ON 23.3.2001 . IN VIEW OF THIS LETTER OF CIT, UJJAIN, THE IMPUGNED ORDER P ASSED ON 5.10.2010 DOES NOT APPEAR TO BE IN ACCORDANCE WITH THE DIRECTION OF THE HON'BLE HIGH COURT. HON'BLE HIGH C OURT IN ITS ORDER HAD CLEARLY DIRECTED THE CIT, UJJAIN, TO DECI DE THE CLAIM OF THE ASSESSEE ON MERIT FOR GRANT OF REGISTRATION U/S 12A ON THE BASIS OF ASSESSEES APPLICATION DATED 23.3.2001 . IN CASE CIT, UJJAIN, DOES NOT FIND THIS APPLICATION IN HIS OFFICE, THE -: 10: - 10 RECORD WAS TO BE CALLED FROM CIT, BHOPAL. HOWEVER, WITHOUT MAKING ANY EFFORTS TO FIND OUT ASSESSEES APPLICATI ON DATED 23.3.2001, THE CIT, UJJAIN, DECLINED TO DECIDE THE SAME ON MERITS INSPITE OF CLEAR DIRECTION BY THE HON'BLE HI GH COURT. SINCE THE OFFICE OF THE CIT, UJJAIN, ITSELF SPEAKS VIDE LETTER DATED 11.7.2011 THAT THE APPLICATION OF ASSESSEE U/ S 12A WAS SUBMITTED ON 23.3.2001, THERE IS NO REASON TO GRANT REGISTRATION WITH REFERENCE TO THIS APPLICATION. TH E TRIBUNAL VIDE ITS ORDER DATED 10.8.2009 HAVE ALREADY HELD TH AT THE ASSESSEE IS A PUBLIC RELIGIOUS TRUST AND ACTION OF THE CIT REFUSING TO GRANT REGISTRATION TO THE ASSESSEE TRUS T ON THE GROUND OF VIOLATION OF PROVISIONS ON 13(1)(B) OF TH E ACT WAS NOT JUSTIFIED. GOING FURTHER BY THE PRECISE DIRECTION O F THE HON'BLE HIGH COURT. LETTER DATED 11.7.2011 ISSUED BY CIT, U JJAIN, CLEAR THE POSITION THAT ASSESSEES APPLICATION DATED 23.3 .2001 WAS IN ITS RECORD. IN TERMS OF DIRECTION OF HON'BLE HIG H COURT, THE GRANT OF REGISTRATION WAS TO BE DECIDED IN TERMS OF ASSESSEES APPLICATION DATED 23.3.2001, WHICH THE CIT FAILED A ND ASSESSEE IS AGAIN BEFORE US TO DECIDE THE ISSUE OF GRANT OF -: 11: - 11 REGISTRATION U/S 12A WITH REFERENCE TO ITS APPLICAT ION DATED 23.3.2001. 7. WE HAVE CONSIDERED THE RIVAL CONTENTIONS, CAREFULLY GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW, O RDER OF THE TRIBUNAL DATED 10.8.2009 AS WELL AS DIRECTIONS ISS UED BY THE HON'BLE HIGH COURT VIDE ITS ORDER DATED 28.1.2010 A ND ALSO LETTER DATED 11.7.2011 ISSUED BY CIT, UJJAIN. IT IS CLEAR FROM THE ORDER OF THE TRIBUNAL THAT THE ASSESSEE IS A PU BLIC RELIGIOUS TRUST ENTITLED FOR REGISTRATION U/S 12A/12AA. HOWEV ER, THE TRIBUNAL AFTER EXAMINING THE GENUINENESS OF TRUST A ND ITS ACTIVITIES ALLOWED REGISTRATION ON THE BASIS OF AP PLICATION DATED 19.8.2008 AND NOT ON THE BASIS OF APPLICATION DATED 23.3.2001 AS THE SAME WAS NOT TRACEABLE. NOW WHEN IT IS CLEAR THAT THE ASSESSEES APPLICATION DATED 23.3.2001 WAS ALREADY WITH THE DEPARTMENT, THEN ASSESSEES CLAIM FOR REGISTRATION IS REQUIRED TO BE ALLOWED W.E.F. 1.4.2000. 8. AFTER CONSIDERING THE ENTIRE MATERIAL PLACED ON REC ORD, WE ARE OF THE CONSIDERED VIEW THAT THE ASSESSEE SHO ULD BE GRANTED REGISTRATION W.E.F 1.4.2000 AS PER APPLICAT ION FILED ON 23.3.2001. WE DIRECT ACCORDINGLY. -: 12: - 12 9. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWE D IN TERMS INDICATED HEREINABOVE. THIS ORDER HAS BEEN PRONOUNCED IN THE OPEN COURT ON 20 TH OCTOBER, 2011. SD/- SD/- (JOGINDER SINGH) ( R.C.SHARMA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 20 TH OCTOBER, 2011. CPU* 1720