Shree Asandas B Murjani Education Trust, Ahmedabad V. The CIT (Exemption), Ahmedabad

ITA 65/AHD/2022

• Counselvise Citation: [2023] 100 COUNSELVISE.COM (IT) 4707 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 9 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-12-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 08-11-2023
• Assessment Year: 2019-2020
• Appeal Filed On: 06-03-2022
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Benefit of exemption
• Section: 6; 11; 143(3); 12AA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, AHMEDABAD BEFORE SMT. ANNAPURNA GUPTA, ACCOUNTANT MEMBER & SHRI SIDDHARTHA NAUTIYAL, JUDICIAL MEMBER I .T .A . No .6 5/ A h d / 2 02 2 ( A s se ss m e nt Y e a r : 20 19- 2 0 ) Sh r ee A sa nd a s B M ur j an i Ed uc a ti o n T r u s t, 28, A nk ur S oc ie t y, Nr . P r i ya C in e ma K r u s h n ag ar , Ah me da b ad -3 82 3 4 5 V s . C o m mi s s io n e r of I n co me Ta x – ( Ex e mp t io n) , A h m e da ba d [P AN N o. A A T T S9 4 9 6 D ] (Appellant) . . (Respondent) Appellant by : Shri Jaimin Shah, A.R. Respondent by: Shri Akhilendra Pratap Yadaw, CIT D.R. D a t e of H ea r i ng 09.11.2023 D a t e of P r o no u n ce me nt 13.12.2023 O R D E R PER SIDDHARTHA NAUTIYAL - JUDICIAL MEMBER: This appeal has been filed by the Assessee against the order passed by the Ld. Commissioner of Income Tax (Exemption) (in short “Ld. CIT(E)”), Ahmedabad in Order No. ITBA/EXM/S/EXM1/2019-20/1018092370(1) vide order dated 19.09.2019, passed for Assessment Year 2019-20. 2. The assessee has taken the following grounds of appeal:- “1. That the Ld. CIT(Exemption), Ahmedabad has erred in law and on Facts while rejected the registration application U/s 12AA of the Income Tax Act, 1961 and therefore the order passed by CIT(Exemption), Ahmedabad may please be deleted. 2. That the assessee has made application u/s 12AA of the I.T. Act, 1961. However, the same was rejected without giving proper opportunity of being heard and without considering the reply filed by the assessee on 19/09/2019 is against the ITA No. 65/Ahd/2022 Shree Asandas B Murjani Education Trust vs. CIT(E) Asst.Year –2019-20 - 2– provision of law and therefore the order passed on 19/09/2019 for rejection of application u/s 12AA dated 19/09/2019 may please be quashed. 3. That the objects of the assessee trust are eligible for registration U/s 12AA of the I.T. Act, 1961, however, the application for registration was rejected by Ld. CIT (Exemption), Ahmedabad is against the provision of law. Therefore the registration u/s 12AA of the I.T. Act, 1961 may please be granted. 4. That the appellant has submitted all the details along with application U/s 12AA on 20.03.2019 however the application rejected without appreciating the facts and without further inquiry by the CIT(Exemption), Ahmedabad is gross violation of natural justice. 5. The assessee craves leave to add, alter, amend or delete any grounds of appeal before the appeal finally heard and decided.” 3. At the outset, we observe that the appeal of the assessee is time-barred by 840 days. The assessee has filed application for condonation of delay stating that the assessee trust had filed an application for registration under Section 12AA of the Act on 20.03.2019. Notice calling for information was issued on 30.08.2019 by CIT(Exemptions). However, it was submitted that since the concerned Chartered Accountant of the assessee trust was busy, required documents could be filed only on 19.09.2019. However, the CIT (Exemptions) passed an order rejecting the application for grant of registration under Section 12AA of the Act, without considering the details filed by the assessee trust on the same date i.e. 19.09.2019. Further, the Chartered Accountant of the assessee trust also filed another application under Section 12AA of the Act on 23.10.2019 and on the very same set of facts, the assessee trust was granted the registration certificate on 20.03.2020. It was submitted that on receiving the registration certificate, the assessee trust was under the ITA No. 65/Ahd/2022 Shree Asandas B Murjani Education Trust vs. CIT(E) Asst.Year –2019-20 - 3– genuine belief that the exemption certificate is applicable for the impugned Assessment Year 2019-20 as well, since CIT (Exemptions) had incorrectly rejected the first application for registration on the very same set of facts, on which set of facts, the later certificate of registration under Section 12AA of the Act was granted. It was submitted before us that the assessee trust was never advised by the consultants to file an appeal against the order of rejection of certificate of registration under Section 12AA of the Act dated 19.09.2019. It was submitted that the assessee was under the genuine belief that once the assessee trust had got the registration under Section 12AA of the Act on filing of second application on the same set of facts, then the said registration will be effective for the impugned assessment year as well. It was submitted before us that it was only subsequently when the assessment order under section 143(3) of the Act was passed for the impugned Assessment Year 2019-20 with the heavy additions and the assessee received SMS on his mobile, that the assessee trust consulted another Chartered Accountant, who upon logging into the income tax portal of the assessee trust on 24.01.2022 pointed out that assessment order under Section 143(3) of the Act had been passed on 22.09.2021 with heavy additions on the basis that the benefit of Section 11 and 12 of the Act was not available to the assessee trust, since the application for grant of registration under Section 12AA of the Act had been rejected. It was only thereafter that the assessee trust was advised to file an appeal against the order rejecting grant of registration under Section 12AA of the Act by CIT(Exemptions), and accordingly the assessee trust filed appeal against the order rejecting grant of registration under Section 12AA of the Act, after a delay of 840 days. Accordingly, it was submitted before us that the delay in filing of the present appeal was due to bona fide reasons that firstly, the assessee trust was under the incorrect impression that once registration had ITA No. 65/Ahd/2022 Shree Asandas B Murjani Education Trust vs. CIT(E) Asst.Year –2019-20 - 4– been granted under Section 12AA of the Act, upon filing of the second application on the same set of facts, the benefit of exemption was available to the assessee trust for the impugned assessment year as well and secondly, it was submitted that the assessee has been genuinely carrying out charitable activities, which is evident from the fact that on filing of second application for grant of registration, the CIT(Exemptions) had granted registration under Section 12AA of the Act to the assessee trust on the same set of facts. Accordingly, it was submitted that looking into the instant facts, the delay in filing of the present appeal may kindly be condoned. Further, the counsel for the assessee submitted before us that that the assessee trust has good case on merits, which is evident from the fact that on the same set of facts, the second application for grant of registration under Section 12AA of the Act had been accepted by the CIT(Exemptions) and registration had been granted. Accordingly, it was submitted that in the interest of justice, the matter may be remanded to the file of CIT(Exemptions) to consider the matter afresh, in accordance with law. 4. In response, DR placed reliance on the observations made by CIT(Exemptions) in the order dated 19.09.2019. 5. We have heard the rival contentions and perused the material on record. On going to the facts of the instant case, we are of the considered view that the delay in filing of the present appeal has been caused due to bona fide mistake on part of the assessee trust and also on account of the fact that consultants of the assessee never advised the assessee to file appeal against the first order of rejection. Accordingly, looking into the instant facts, the delay in filing of the present appeal is hereby condoned. ITA No. 65/Ahd/2022 Shree Asandas B Murjani Education Trust vs. CIT(E) Asst.Year –2019-20 - 5– 6. On merits, the fact that upon filing of second application for grant of registration under Section 12AA of the Act, the assessee trust was granted registration under Section 12AA of the Act, on same set of facts points to the fact that that the assessee trust has a genuine case on merits, and that the assessee has been able to establish that it is carrying on genuine charitable activities. Accordingly, in the interest of justice, looking into the instant facts, the matter is being restored to the file of CIT(Exemptions) to consider the application of the assessee trust afresh, in accordance with law. 7. In the result, the appeal of the assessee is allowed for statistical purposes. This Order pronounced in Open Court on 13/12/2023 Sd/- Sd/- (ANNAPURNA GUPTA) (SIDDHARTHA NAUTIYAL) ACCOUNTANT MEMBER JUDICIAL MEMBER Ahmedabad; Dated 13/12/2023 TANMAY, Sr. PS TRUE COPY आदेश क त ल प अ े षत/Copy of the Order forwarded to : 1. अपीलाथ / The Appellant 2. यथ / The Respondent. 3. संबं धत आयकर आय ु त / Concerned CIT 4. आयकर आय ु त(अपील) / The CIT(A)- 5. वभागीय त न ध, आयकर अपील!य अ धकरण, अहमदाबाद / DR, ITAT, Ahmedabad 6. गाड' फाईल / Guard file. आदेशान ु सार/ BY ORDER, उप/सहायक पंजीकार (Dy./Asstt.Registrar) आयकर अपील य अ धकरण, अहमदाबाद / ITAT, Ahmedabad 1. Date of dictation 04.12.2023(Dictated on his Dragon Software by Hon’ble Member) 2. Date on which the typed draft is placed before the Dictating Member 04.12.2023 3. Other Member..................... 4. Date on which the approved draft comes to the Sr.P.S./P.S 07.12.2023 5. Date on which the fair order is placed before the Dictating Member for pronouncement .12.2023 6. Date on which the fair order comes back to the Sr.P.S./P.S 13.12.2023 7. Date on which the file goes to the Bench Clerk 13.12.2023 8. Date on which the file goes to the Head Clerk.......................................... 9. The date on which the file goes to the Assistant Registrar for signature on the order.......................... 10. Date of Despatch of the Order..........................................