Baijnath FKanhaiya Lal Memorial Trust, Jalaun V. Commissioner of Income Tax -II, Kanpur

ITA 677/LKW/2013

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 78511 (ITAT-LUCKNOW)
• Duration Of Justice: 8 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-05-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 24-04-2014
• Assessment Year: 2013-2014
• Appeal Filed On: 12-09-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VIVEK MISHRA
• Assessee Lawyers: J J MEHROTRA
• Keywords: Opportunity of being heard
• Section: 12A; 12AA

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH B, LUCKNOW BEFORE SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI A.K. GARODIA, ACCOUNTANT MEMBER ITA NO.677/LKW/2013 ASSESSMENT YEAR:N.A. BAIJNATH KANHAIYA LAL MEMORIAL TRUST, 378, BAITHGANJ, JALAUN. PAN:AACTB0406B VS. C.I.T. - II, KANPUR. (APPELLANT) (RESPONDENT) APPELLANT BY SHRI J. J. MEHROTRA, C.A. RESPONDENT BY SHRI VIVEK MISHRA, CIT, D.R. DATE OF HEARING 24/04/2014 DATE OF PRONOUNCEMENT 1 3 /05/2014 O R D E R PER A. K. GARODIA, A.M. THIS IS AN ASSESSEES APPEAL DIRECTED AGAINST THE ORDER PASSED BY LEARNED CIT - II, KANPUR DATED 12/07/2013 U/S 12AA OF THE ACT. 2. THE GROUNDS RAISED BY THE ASSESSEE ARE AS UNDER: 1. THAT THE LD. COMMISSIONER OF INCOME TAX - II HAS ERRED IN LAW AS WELL AS ON THE FACTS AND CIRCUMSTANCES OF THE CASE IN REFUSING REGISTRATION TO THE APPELLANT - TRUST UNDER SECTION 12A OF THE INCOME TAX ACT, 1961. 2. THAT THE LD. COMMISSIONER OF INCOME TAX - II HAS FAILED TO APPRECIATE THAT TILL THE DATE OF APPLI CATION FILED FOR REGISTRATION, NO ACTIVITIES WERE CARRIED OUT BY THE APPELLANT - TRUST AND, THEREFORE, THERE IS NO JUSTIFICATION IN REJECTING GRANT OF REGISTRATION UNDER SECTION 12A OF THE INCOME TAX ACT ON PRESUMPTIONS AND SURMISES. 3. THAT THE LD. COMMISS IONER OF INCOME TAX - II HAS FAILED TO APPRECIATE THAT THE MAIN OBJECTS OF THE APPELLANT - TRUST ARE CHARITABLE IN NATURE AND THEREFORE ALL THE MORE THERE IS NO 2 JUSTIFICATION IN REFUSING TO REGISTER THE APPELLANT - TRUST UNDER SECTION 12A OF THE INCOME TAX ACT. 4. THAT THE VARIOUS OBSERVATIONS MADE BY THE LD. COMMISSIONER OF INCOME TAX - II ARE ON HYPOTHESIS, SURMISES AND IN ANY VIEW OF THE MATTER, HE IS NOT JUSTIFIED IN REFUSING TO REGISTER THE APPELLANT - TRUST UNDER SECTION 12A OF THE INCOME TAX ACT 1961. 5. THAT THE ORDER PASSED BY THE LD. COMMISSIONER OF INCOME TAX - II IS WITHOUT PROPER OPPORTUNITY AND BAD IN LAW. 6. THAT THE ORDER PASSED BY THE L D . COMMISSIONER OF INCOME TAX - II IS AGAINST THE MERITS/ CIRCUMSTANCES AND LEGAL ASPECTS OF THE CASE. 7. THAT THE APPELLANT CRAVES LEAVE TO ADD, ALTER/ AMEND OR WITHDRAW ANY OR ALL THE GROUNDS OF APPEAL ON OR BEFORE THE DATE OF HEARING. 3. IT WAS SUBMITTED BY LEARNED A.R. OF THE ASSESSEE THAT THE OBJECTS OF THE ASSESSEE ARE CHARITABLE AND THEREFORE, THE REGISTRATION SHOULD HAVE BEEN GRANTED BY LEARNED CIT BUT HE HAS REJECTED THE SAME ON THE BASIS THAT THERE IS NO EVIDENCE OF ANY ACTIVITY. H E SUBMITTED THAT THE ASSESSEE TRUST WAS CONSTITUTED ON 08/11/2012 AND THE APPLICATION FOR REGISTRATION WAS MADE ON 22/04/2013 AND THE IMPUGNED ORDER HAS BEEN PASSED BY CIT ON 12/07/2013. HE SUBMITTED THAT EVEN ONE YEAR HAS NOT PASSED AT THE TIME WHEN THE IMPUGNED ORDER WAS PASSED BY CIT AND THEREFORE, IT WAS NOT JUSTIFIED ON HIS PART TO REJECT THE ASSESSEES APPLICATION FOR REGISTRATION ON THE BASIS THAT THERE IS NO ACTIVITY BECAUSE IT TAKES SOME TIME TO COLLECT DONATIONS ETC. AND START ACTIVITIE S. HE FURTHER SUBMITTED THAT IN VIEW OF THIS FACT THAT THERE IS NO DOUBT INDICATED BY CIT REGARDING THIS ASPECT THAT THE OBJECTS OF THE ASSESSEE TRUST ARE NOT CHARITABLE, THE REGISTRATION SHOULD BE GRANTED TO THE ASSESSEE. 4. LEARNED D.R. OF THE REVENUE SUPPORTED THE ORDER OF LEARNED CIT. 3 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE FIND THAT AS PER THE PROVISIONS OF SECTION 12AA OF THE ACT, LEARNED CIT IS REQUIRED TO SATISFY HIMSELF ABOUT THE GENUINENESS OF THE ACTIVITIES OF THE TRUST. IN THE PRESE NT CASE, WE FIND FORCE IN THE SUBMISSIONS OF LEARNED A.R. OF THE ASSESSEE THAT AT THE TIME WHEN THE ORDER WAS PASSED BY LEARNED CIT ON 12/07/2013, SUFFICIENT TIME DID NOT ELAPSE ENABLING THE ASSESSEE TO BRING EVIDENCE ON RECORD TO ESTABLISH THE GENUINENESS OF THE ACTIVITIES OF THE ASSESSEE TRUST. BUT NOW ABOUT 1 YEAR HAS ELAPSED FROM THE DATE OF TRUST DEED I.E. 08/11/2012 AND THEREFORE, WE FEEL IT PROPER THAT THE MATTER SHOULD BE RESTORED BACK TO THE FILE OF LEARNED CIT FOR FRESH DECISION. HENCE, WE SET ASIDE THE ORDER OF CIT AND RESTORE THE MATTER BACK TO HIS FILE FOR FRESH DECISION. NOW THE ASSESSEE CAN BRING EVIDENCE ON RECORD TO ESTABLISH THAT ITS ACTIVITIES ARE GENUINE AND AFTER CONSIDERING THE SAME , THE CIT SHOULD PASS A FRESH ORDER AS PER LAW AFT ER PROVIDING REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE STANDS ALLOWED FOR STATISTICAL PURPOSES. (ORDER WAS PRONOUNCED IN THE OPEN COURT ON THE DATE MENTIONED ON THE CAPTION PAGE) SD/. SD/. (SUNIL KUMAR Y ADAV) ( A. K. GARODIA ) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 1 3 /05/2014. *C.L.SINGH COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT. 3. CONCERNED CIT 4. THE CIT(A) 5. D.R., I.T.A.T., LUCKNOW ASSTT. REGISTRAR