Khatoon Minority Women Soc, Nashik V. Deputy Commissioner of Income Tax, Exemption Circle, Aurangabad, Aurangabad

ITA 723/PUN/2022

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The case involves Khatoon Minority Women Society, a public charitable trust registered under the Bombay Public Trust Act, 1950, and under section 12A of the Income Tax Act, 1961. The trust filed a return of income for the assessment year 2019-20, claiming exemption under section 11 of the Act, which was denied by the CPC due to the absence of a prescribed audit report in Form No.10B and a claim that the trust was not registered under section 12A. The trust's appeal to the National Faceless Appeal Centre (NFAC) was unsuccessful, leading to the current appeal before the Income Tax Appellate Tribunal. The Tribunal found that the CPC had not issued the required intimation of the proposed adjustment, leading to a violation of natural justice.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 137166 (ITAT-PUNE)
• Duration Of Justice: 8 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-06-2023
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: A
• Next Hearing Date: 29-05-2023
• Assessment Year: 2019-2020
• Appeal Filed On: 25-09-2022
• Laws Referred To: Income Tax Act, 1961, Bombay Public Trust Act, 1950
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Charitable institution
• Section: 11; 12A; 143(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH “A”, PUNE BEFORE SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER AND SHRI S. S. VISWANETHRA RAVI, JUDICIAL MEMBER आयकर अपील सं. / ITA No.723/PUN/2022 िनधाᭅरण वषᭅ / Assessment Year : 2019-20 Khatoon Minority Women Soc., 534, MHB Colony, Hazar Kholi, Malegaon, Nashik- 423203. PAN : AAATK7419B Vs. DCIT, Exemption Circle, Aurangabad. Appellant Respondent आदेश / ORDER PER INTURI RAMA RAO, AM: This is an appeal filed by the assessee directed against the order of the National Faceless Appeal Centre, Delhi [‘NFAC’] dated 13.07.2022 for the assessment year 2019-20. 2. Briefly, the facts of the case are that the appellant is a public charitable trust registered under the Bombay Public Trust Act, 1950. Assessee by : Shri Sanket M. Joshi Revenue by : Shri Keyur Patel Date of hearing : 30.05.2023 Date of pronouncement : 02.06.2023 ITA No.723/PUN/2022 2 The appellant trust was also registered under the provisions of section 12A of the Income Tax Act, 1961 (‘the Act’) on 03.05.2006. The appellant trust is engaged in rendering services in the field of education. The Return of Income for the assessment year 2019-20 was filed on 30.09.2019 declaring Rs.Nil income after claiming exemption u/s 11 of the Act. The said return of income was processed u/s 143(1) of the Act vide intimation dated 26.03.2021 in respect of entire gross receipts of income of Rs.9,61,94,922/- denied the exemption u/s 11 on the ground that as per the details furnished in the return of income, the appellant trust was not registered u/s 12A of the Act nor had the assessee filed the prescribed audit report in Form No.10B along with the return of income. 3. Being aggrieved by the intimation, a rectification petition was filed by the appellant trust u/s 143(1) pointing out that the appellant trust is registered u/s 12A of the Act. The appellant trust also brought to the notice of the CPC that the Form No.10B was filed and petition to condone the delay in filing of Form No.10B is also filed before the Pr. CIT, Exemption, Pune. ITA No.723/PUN/2022 3 4. Being aggrieved by the intimation, an appeal was filed before the NFAC, who vide impugned order confirmed the action of the CPC. 5. Being aggrieved, the appellant is in appeal before us in the present appeal. 6. Before us a preliminarily issue was raised that the appellant trust was not issued intimation of the proposed adjustment as provided under proviso to section 143(1) of the Act. This fact was not disputed by the ld. CIT-DR stating that the intimation of the proposed adjustment could not be issued due to some technical issue. Thus, it is an admitted position that no prior intimation has been issued before making the prima-facie adjustment. There is a blatant violation of principles of natural justice as well as the mandatory procedure prescribed u/s 143(1) of the Act. In view of the above, we hereby set-aside the intimation u/s 143(1) and the matter is remanded to the CPC, who shall issue a fresh intimation about proposed adjustment and thereafter process the return of income u/s 143(1) of the Act in accordance with law. ITA No.723/PUN/2022 4 7. In the result, the appeal filed by the assessee stands partly allowed. Order pronounced on this 02 nd day of June, 2023. Sd/- Sd/- (S. S. VISWANETHRA RAVI) (INTURI RAMA RAO) JUDICIAL MEMBER ACCOUNTANT MEMBER पुणे / Pune; ᳰदनांक / Dated : 02 nd June, 2023. Sujeet आदेश कᳱ ᮧितिलिप अᮕेिषत / Copy of the Order forwarded to : 1. अपीलाथᱮ / The Appellant. 2. ᮧ᭜यथᱮ / The Respondent. 3. The Pr. CIT-1, Nashik. 4. िवभागीय ᮧितिनिध, आयकर अपीलीय अिधकरण, “A” बᱶच, पुणे / DR, ITAT, “A” Bench, Pune. 5. गाडᭅ फ़ाइल / Guard File. आदेशानुसार / BY ORDER, // True Copy // Senior Private Secretary आयकर अपीलीय अिधकरण, पुणे / ITAT, Pune.