V V Nagar Ayyappa Bhakta Samiti, V v Nagar V. CIT (Exemptions), Ahmedabad

ITA 668/AHD/2018

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 3020 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 11 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-03-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 02-03-2020
• Assessment Year: misc
• Appeal Filed On: 16-03-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Opportunity of being heard; Principle of natural justice; Set aside; Audi alteram partem
• Section: 12AA

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, AHMEDABAD BEFORE SHRI SANDEEP GOSAIN, JUDICIAL MEMBER AND SHRI AMARJIT SINGH, ACCOUNTANT MEMBER ./ I.T.A. NO.668/AHD/2018 ( / ASSESSMENT YEARS : - ) V V NAGAR AYYAPPA BHAKTA SAMITI LIG-11, ROOM NO.50 GIDC QUARTER, GIDC ESTATE VU NAGAR 388 121 / VS. THE COMMISSIONER OF INCOME TAX (EXEMPTION) AHMEDABAD ./ ./ PAN/GIR NO. : AABTV 5038 L ( / APPELLANT ) .. ( / RESPONDENT ) / APPELLANT BY : MS. ARTI N.SHAH, AR / RESPONDENT BY : SHRI SAMIR TEKRIWAL, CIT-DR / DATE OF HEARING 02/03/2020 !'# / DATE OF PRONOUNCEMENT 04/03/2020 / O R D E R PER SHRI SANDEEP GOSAIN, JUDICIAL MEMBER : THE ASSESSEE IS IN APPEAL BEFORE US AGAINST THE ORD ER OF LD.COMMISSIONER OF INCOME TAX(EXEMPTIONS), AHMEDABA D [CIT(E) IN SHORT] DATED 15/02/2018. 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: ITA NO.668 /AHD/2018 V V NAGAR AYYAPPA BHAKTA SAMITI VS. CIT(E) - 2 - 1. THE LEARNED COMMISSIONER OF INCOME TAX (EXEMPTI ONS), AHMEDABAD HAS ERRED IN NOT GRANTING EXEMPTION TO THE APPELLANT U/ S.12AA OF THE I.T.ACT, 1961 THOUGH NECESSARY DOCUMENTS AND INFORMATION AS CALLE D FOR, WERE SUBMITTED TO COMMISSIONER OF INCOME TAX (EXEMPTIONS) BY THE APPE LLANT. 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE, I N THE PRESENT CASE, HAD APPLIED FOR REGISTRATION OF TRUST U/S.12AA OF T HE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) BEFORE THE LD.CIT(E), AHMEDABAD, HOWEVER THE SAID APPLICATION FOR REGISTR ATION U/S.12AA OF THE ACT WAS REJECTED BY THE CIT(E), AHMEDABAD BY HO LDING THAT ASSESSEE FAILED TO FILE DOCUMENTARY EVIDENCES TO ENABLE HIM TO BRING SATISFACTION ABOUT THE GENUINENESS OF THE ASSESSEE-TRUST ACTIVIT IES. 4. THE LD.AR SUBMITTED BEFORE US THAT ASSESSEE HAD ALREADY SUBMITTED ALL THE REQUIRED DOCUMENTS WHICH WERE NOT CONSIDERED BY LD.CIT(E). IT WAS SUBMITTED THAT ASSESSEE IS ENTI TLED FOR REGISTRATION U/S.12AA OF THE ACT ON THE BASIS OF ITS OBJECTS, WI THOUT ANY ACTIVITY HAVING BEEN UNDERTAKEN AND RELIED UPON THE DECISION OF HONBLE APEX COURT IN THE CASE OF ANANDA SOCIAL & EDUCATIONAL TR UST VS. CIT REPORTED AT (2020) 114 TAXMANN.COM 693 (SC) WHEREIN IT WAS H ELD AS UNDER: SECTION 12AA PROVIDES FOR REGISTRATION OF A TRUST . SUCH REGISTRATION CAN BE APPLIED FOR BY A TRUST WHICH HAS BEEN IN EXI STENCE FOR SOME TIME AND ALSO BY A NEWLY REGISTERED TRUST. THERE IS NO STIPULATION THAT TRUST SHOULD HAVE ALREADY BEEN IN EXISTENCE AND SHOULD HA VE UNDERTAKEN ANY ACTIVITIES BEFORE MAKING APPLICATION FOR REGISTRAT ION. ITA NO.668 /AHD/2018 V V NAGAR AYYAPPA BHAKTA SAMITI VS. CIT(E) - 3 - SINCE SECTION 12AA PERTAINS TO REGISTRATION OF TRUS T AND NOT TO ASSESS OF WHAT A TRUST HAS ACTUALLY DONE, IT IS VIEWED THAT T ERM ACTIVITIES IN PROVISION INCLUDES PROPOSED ACTIVITIES. THAT IS TO SAY, A COMMISSIONER IS BOUND TO CONSIDER WHETHER OBJECTS OF TRUST ARE G ENUINELY CHARITABLE IN NATURE AND WHETHER ACTIVITIES WHICH TRUST PROPOS ED TO CARRY ON ARE GENUINE IN SENSE THAT THEY ARE IN LINE WITH OBJECTS OF TRUST. 4.1. THE LD.AR ALSO SUBMITTED BY WAY OF PAPER-BOOK THE DETAILS OF THE COPIES OF APPLICATION/COPY OF NOTICE/COPY OF LETTER WHICH WERE FILED BEFORE CIT(E) AS PER PARTICULARS SHOWN BELOW: SL.NO. PARTICULARS PAGE (S) IN PAPER - BOOK FILED BEFORE 1. COPY OF APPLICATION DATED 10/08/2017 ADDRESSED TO THE INCOME TAX (HQ), (EXEMPTION), AHMEDABAD ALONG WITH TRUST DEED AND THEIR ENCLOSURES. 1 TO 60 ASSESSING OFFICER 2. COPY OF APPLICATION DATED 08.10.2017 ADDRESSED TO COMMISSIONER OF INCOME TAX, (EXEMPTION), AHMEDABAD ALONG WITH ENCLOSURES 61 TO 94 CIT 3. COPY OF NOTICE DATED 01/01/2018 FROM THE COMMISSIONER OF INCOME TAX, (EXEMPTION), AHMEDABAD 95 - 4. COPY OF LETTER DATED 22/01/2018 ADDRESSED TO COMMISSIONER OF INCOME TAX, (EXEMPTION), AHMEDABAD 96 & 97 CIT 5. ON THE CONTRARY, LD.DR RELIED UPON THE ORDER PAS SED BY LD.CIT(E). ITA NO.668 /AHD/2018 V V NAGAR AYYAPPA BHAKTA SAMITI VS. CIT(E) - 4 - 6. AFTER HEARING BOTH THE PARTIES AT LENGTH, WE FOUND THAT ASSESSEE COULD NOT APPEAR BEFORE LD.CIT(E) WHEN THE CASE WAS CALLED FOR AND IN THE ABSENCE OF THE ASSESSEE, THE LD.CIT(E) WHILE RE LYING UPON THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF CI T VS. DAWOODI BOHARA JAMAT (CIVIL APPEAL NO.2492 OF 2014) HAD DEC IDED THE APPLICATION FOR REGISTRATION OF TRUST U/S.12AA OF T HE ACT FILED BY THE ASSESSEE. 7. BE THAT AS IT MAY, AFTER CONSIDERING THE RIVAL S UBMISSIONS, WE ARE OF THE VIEW THAT MATTER REQUIRES RECONSIDERATION AT TH E LEVEL OF LD.CIT(E). SINCE ACCORDING TO ASSESSEE, THE ASSESSEE HAD ALREA DY SUBMITTED THE REQUIRED DOCUMENTS BEFORE LD.CIT(E), BUT THE SAME D O NOT FIND MENTION IN THE ORDER. THEREFORE, IT CAN BE INFERRED THAT THOSE DOCUMENTS FILED BY THE ASSESSEE WERE NOT CONSIDERED. THE PRINCIPLE OF AUDI ALTERAM PARTEM IS THE BASIC CONCEPT OF NATURAL JUSTICE. THE EXPRES SION AUDI ALTERAM PARTEM IMPLIES THAT A PERSON MUST BE GIVEN AN OPPORTUNIT Y TO DEFEND HIMSELF. THIS PRINCIPLE IS SINE QUA NON OF EVERY CIVILIZED SOCIETY. THE RIGHT TO NOTICE, RIGHT TO PRESENT CASE AND EVIDENCE , RIGHT TO REBUT ADVERSE EVIDENCE, RIGHT TO CROSS EXAMINATION, RIGHT TO LEGA L REPRESENTATION, DISCLOSURE OF EVIDENCE TO PARTY, REPORT OF ENQUIRY TO BE SHOWN TO THE OTHER PARTY AND REASONED DECISIONS OR SPEAKING ORDERS. WE TOOK THIS GUIDANCE FOR RIGHT OF HEARING, FROM THE RATIO AS IS LAID DOW N BY THE HON'BLE SUPREME COURT IN THE CASE OF MANEKA GANDHI V. UNION OF INDIA, WHEREIN ITA NO.668 /AHD/2018 V V NAGAR AYYAPPA BHAKTA SAMITI VS. CIT(E) - 5 - HON'BLE SUPREME COURT HAS LAID DOWN THAT RULE OF FA IR HEARING IS NECESSARY BEFORE PASSING ANY ORDER. WE FIND THAT IT IS PRE-DECISION HEARING STANDARD OF NORM OF RULE OF AUDI ALTERAM PARTEM. WE ARE, THEREFORE, OF THE VIEW THAT MATTER REQUIRES RECONSI DERATION AT THE LEVEL OF LD.CIT(E). THUS, WHILE SETTING ASIDE THE ORDER OF LD.CIT(E), WE RESTORE IT BACK TO LD.CIT(E) AND DIRECT THAT ALL THE DOCUME NTS FILED BY THE ASSESSEE BE CONSIDERED AND ASSESSEE BE GIVEN ONE MO RE OPPORTUNITY OF BEING HEARD AND TO FILE ANY OTHER DOCUMENTS BEFORE THE LD.CIT(E), AHMEDABAD AS CALLED FOR AND THE LD.CIT(E) IS ALSO D IRECTED TO DECIDE THE APPLICATION FOR REGISTRATION FILED BY THE ASSESSEE, KEEPING IN VIEW THE PRINCIPLES LAID DOWN IN THE AFORESAID JUDGEMENTS WH ILE PASSING A FRESH ORDER, IF THE ASSESSEE WANTS TO SUBMIT ANY DOCUMENT , HE IS AT LIBERTY TO SUBMIT BEFORE THE LD.CIT(E). ACCORDINGLY, THE APPE AL OF THE ASSESSEE IS SET ASIDE TO THE FILE OF LD.CIT(E) FOR STATISTICAL PURPOSES. 8. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE COURT ON 04 -03 -2020 AT AHMEDABAD SD/- SD/- ( AMARJIT SINGH) ( SANDEEP GOSAIN) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD; DATED 04/ 03 /2020 &.., .(../ T.C. NAIR, SR. PS ITA NO.668 /AHD/2018 V V NAGAR AYYAPPA BHAKTA SAMITI VS. CIT(E) - 6 - !'#$#! / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. )*+ , / CONCERNED CIT 4. , ( ) / THE CIT(E), AHMEDABAD 5. /01 ((*+ , *+# , ) / DR, ITAT, AHMEDABAD 6. 145 6 / GUARD FILE. / BY ORDER, / ( //TRUE COPY// / ( DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD 1. DATE OF DICTATION .. 2.3.20 (DICTATION-PAD 1-PAG E ATTACHED AT THE END OF THIS FILE) 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER ..2.3.20/3.3.20 3. OTHER MEMBER... 4. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P. S./P.S.. 5. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 6. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P .S./P.S.4.3.20 7. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 4.3.20 8. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK ... 9. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER.. 10. DATE OF DESPATCH OF THE ORDER