Kedar Educational Society, Gurugram V. CIT(Exemption), Chandigarh

ITA 7708/DEL/2018

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 9357 (ITAT-DELHI)
• Duration Of Justice: 4 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-04-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: misc
• Appeal Filed On: 04-12-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Charitable institution; Opportunity of being heard; Set aside
• Section: 80G; 12AA; 2

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES D: DELHI BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER ITA.NO.7708/DEL./2018 KEDAR EDUCATIONAL SOCIETY FLAT NO.1201, KEDAR APARTMENT, GH-7, SECTOR- 39, GURGAON. HARYANA. PAN AADAK4600J VS., THE CIT (EXEMPTION), CHANDIGARH. (APPELLANT) (RESPONDENT) FOR ASSESSEE : SHRI ATUL PURI, C.A. FOR REVENUE : SHRI J.K. MISHRA, CIT - D.R. DATE OF HEARING : 04.04.2019 DATE OF PRONOUNCEMENT : 04.04.2019 ORDER PER BHAVNESH SAINI, J.M. THIS APPEAL BY ASSESSEE-SOCIETY HAS BEEN DIRECTED AGAINST THE ORDER OF THE LD. CIT(E), CHANDIGARH, DATED 31.10.2018 REJECTING THE APPLICATION OR APPROVAL UNDER SECTION 80G(5)(VI) OF THE INCOME TAX ACT, 1961. 2. THE FACTS OF THE CASE ARE THAT ASSESSEE FILED AN APPLICATION IN PRESCRIBED FORM FOR APPROVAL UNDER SECTION 2 ITA.NO.7709/DEL./2018 KEDAR EDUCATIONAL SOCIETY, GURUGRAM. 80G OF THE I.T. ACT, 1961. IN THIS CASE, REGISTRATION UNDER SECTION 12AA OF THE I.T. ACT, 1961 HAS BEEN GRANTED TO THE ASSESSEE-SOCIETY VIDE ORDER DATED 29 TH MARCH, 2018. THE LD. CIT(E) CALLED FOR SEVERAL DETAILS/CLARIFICATIONS WITH REGARD TO APPROVAL UNDER SECTION 80G OF THE I.T. ACT. THE ASSESSEE FILED REPLY AS WELL AS DETAILS BEFORE HIM, WHICH REVEAL THAT NO ACTIVITY HAVE BEEN CARRIED-OUT BY THE ASSESSEE-SOCIETY TOWARDS THE STATED OBJECTS. FURTHER, THE ASSESSEE FAILED TO PROVIDE INSTANCE OF ANY DONATIONS RECEIVED BY THE SOCIETY. THE LD. CIT(E) IN THE ABSENCE OF ANY ACTIVITY, THE REAL PURPOSE FOR WHICH THE SOCIETY WAS INCORPORATED REMAIN UNVERIFIABLE. THE APPLICATION FOR APPROVAL WAS ACCORDINGLY REJECTED. 3. AFTER CONSIDERING THE RIVAL SUBMISSIONS, WE ARE OF THE VIEW THAT THE MATTER REQUIRES RECONSIDERATION AT THE LEVEL OF THE LD. CIT(E). IT IS NOT IN DISPUTE THAT ASSESSEE-SOCIETY HAS BEEN GRANTED REGISTRATION UNDER SECTION 12AA OF THE I.T. ACT, 1961 CONSIDERING IT TO BE CHARITABLE SOCIETY. THE LD. CIT(E) WHILE GRANTING THE REGISTRATION UNDER SECTION 12AA OF THE I.T. ACT FOUND THAT THE OBJECTS OF THE ASSESSEE-SOCIETY 3 ITA.NO.7709/DEL./2018 KEDAR EDUCATIONAL SOCIETY, GURUGRAM. ARE GENUINE AND CARRYING ON CHARITABLE ACTIVITIES. LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT ASSESSEE IS AN EDUCATIONAL SOCIETY, WHICH BY ITSELF IS A CHARITABLE ACTIVITY AND THAT DETAILED REPLY AND EVIDENCES WERE FILED BEFORE THE LD. CIT(E) TO SHOW THAT ASSESSEE-SOCIETY CARRYING-OUT THE CHARITABLE ACTIVITIES. SINCE THE ASSESSEE-SOCIETY HAS BEEN GRANTED REGISTRATION UNDER SECTION 12AA OF THE I.T. ACT, THEREFORE, IT IS AN ADMITTED FACT THAT ASSESSEE IS ESTABLISHED FOR CHARITABLE PURPOSES HAVING THE OBJECTS WHICH ARE CHARITABLE IN NATURE. THEREFORE, EVEN IF NO ACTIVITY HAVE BEEN CARRIED OUT BY THE ASSESSEE-SOCIETY TOWARDS ITS OBJECTS, IT WOULD NOT MAKE THE ASSESSEE-SOCIETY DISENTITLE FOR APPROVAL UNDER SECTION 80G OF THE I.T. ACT. HOWEVER, LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT ASSESSEE-SOCIETY IS CARRYING OUT CERTAIN CHARITABLE ACTIVITIES, WHICH HAVE NOT BEEN EXAMINED BY THE LD. CIT(E). THEREFORE, THE MATTER REQUIRES RECONSIDERATION AT THE LEVEL OF THE LD. CIT(E). FURTHER, THE LD. CIT(E) IS NOT JUSTIFIED IN HOLDING THAT ASSESSEE-SOCIETY FAILED TO PRODUCE THE INSTANCE OF ANY DONATION RECEIVED BY THE SOCIETY BECAUSE UNLESS THE ASSESSEE-SOCIETY IS GRANTED 4 ITA.NO.7709/DEL./2018 KEDAR EDUCATIONAL SOCIETY, GURUGRAM. APPROVAL UNDER SECTION 80G(5) OF THE I.T. ACT, 1961, NOBODY WILL PROVIDE DONATION TO THE ASSESSEE-SOCIETY. THEREFORE, IT MAY NOT BE A RELEVANT REASON TO REJECT THE APPLICATION OF THE ASSESSEE-SOCIETY. IN THIS VIEW OF THE MATTER, WE SET ASIDE THE IMPUGNED ORDER AND RESTORE THE MATTER IN ISSUE TO THE FILE OF THE LD. CIT(E), CHANDIGARH WITH A DIRECTION TO RE-DECIDE THE MATTER IN ISSUE IN THE LIGHT OF THE ABOVE OBSERVATIONS AND IN THE LIGHT OF MATERIAL PRODUCED ON RECORD BY THE ASSESSEE SOCIETY, BY GIVING REASONABLE, SUFFICIENT OPPORTUNITY OF BEING HEARD TO THE ASSESSEE-SOCIETY. ACCORDINGLY, APPEAL OF ASSESSEE-SOCIETY IS ALLOWED FOR STATISTICAL PURPOSES. 4. IN THE RESULT, APPEAL OF ASSESSEE ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- (PRASHANT MAHARISHI) (BHAVNESH SAINI) ACCOUNTANT MEMBER JUDICIAL MEMBER DELHI, DATED 04 TH APRIL, 2019 VBP/- 5 ITA.NO.7709/DEL./2018 KEDAR EDUCATIONAL SOCIETY, GURUGRAM. COPY TO 1. THE APPELLANT 2. THE RESPONDENT 3. CIT(A) CONCERNED 4. CIT CONCERNED 5. D.R. ITAT D BENCH 6. GUARD FILE //BY ORDER// ASST. REGISTRAR : ITAT : DELHI BENCHES : DELHI.