SWAMI SUDESHAN ACHARYA JI MAHARAJ CHARITABLE SOCIETY, AMRITSAR V. COMMISSIONER OF INCOME TAX (EXEMPTIONS), CHANDIGARH

ITA 775/ASR/2017

• Counselvise Citation: [2018] 121 COUNSELVISE.COM (IT) 7893 (ITAT-AMRITSAR)
• Duration Of Justice: 8 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-09-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 29-08-2018
• Assessment Year: 2017-2018
• Appeal Filed On: 22-12-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PRABHOJ OT KAUR LD
• Assessee Lawyers: VIPUL ARORA LD
• Keywords: Opportunity of being heard; Competent authority
• Section: 12A; 12AA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUN AL AMRITSAR BENCH, AMRITSAR BEFORE SH. SANJAY ARORA, ACCOUNTANT MEMBER AND SH. N.K.CHOUDHRY, JUDICIAL MEMBER ITA NO.775(ASR)/2017 ASSESSMENT YEAR: SWAMI SUDERSHANA ACHARYA JI MAHARAJ CHARITABLE SOCIETY, INSIDE MUKTINARAYAN DHAM VENKATESH MANDIR, GREEN FIELD MAJITHA ROAD, AMRITSAR PAN:AARTS 1698H VS. CIT(EXEMPTIONS), CHANDIGARH (APPELLANT) (RESPONDENT) APPELLANT BY: SH. VIPUL ARORA (LD. CA) RESPONDENT BY: SMT. PRABHOJOT KAUR (LD. DR) DATE OF HEARING: 29.08.2018 DATE OF PRONOUNCEMENT: 14.09.2018 ORDER PER N.K.CHOUDHRY, JM: THE INSTANT APPEAL HAS BEEN PREFERRED BY THE ASSESSEE/APPELLANT, ON FEELING AGGRIEVED AGAINST THE ORD ER DATED 25.10.2017 PASSED BY THE LD. CIT (EXEMPTIONS), CHANDIG ARH, U/S. 12AA(1)(B)(II) OF THE I.T. ACT, 1961 (HEREINAFTE R CALLED AS THE ACT). 2 . THE ASSESSES HAS RAISED THE FOLLOWING GROUNDS OF APPEAL . 1. THAT THE WORTHY CIT (EXEMPTIONS) ERRED IN FACT S AND LAW IN REJECTING THE APPLICATION OF THE TRUST FOR GRANT OF REGISTRATION U/S 12AA OF INCOME TAX ACT, 1961. 2. THAT THE WORTHY CIT (EXEMPTIONS) HAS IGNORED THE COMPLETE REPLY TO THE QUESTIONNAIRE FILED BY SPEED POST BY THE APPELLANT TRUST. ITA NO.775(ASR)/2017 SWAMI SUDERSHANA ACHARYA JI MAHARAJ CHARITABLE SOCIETY V. CIT(E) 2 3. THAT THE CIT(A) HAS NOT MARKED THE ATTENDANCE OF SH. DHARAM PAL PRASHAR, TRUSTEE OF THE TRUST ON 24.10.2 017 AND SENT TIME BACK ALONG WITH THE REPLY BEING FILED BY HIM TERMING IT AS INCOMPLETE REPLY. 3. IN ADDITION TO THE AFORESAID GROUNDS OF APPEAL AS MENTIONED IN PARA NO.2, THE APPELLANT HAS ALSO RAISED ONE ADDITIONAL GROUND WHICH IS A LEGAL GROUND AS MENTIONED BELOW. THAT THE ORDER U/S. SEC.12AA(1)(B)(II) OF THE INCOM E TAX ACT, 1961 WAS PASSED BEYOND THE PERIOD OF EXPIRY OF SIX MONTHS FROM THE END OF MONTH IN WHICH THE APPLICATI ON WAS RECEIVED BY THE WORTHY CIT 4. WE FEEL IT APPROPRIATE TO DECIDE THE ADDITIONAL GRO UND FIRST, BEFORE PROCEEDING WITH THE MERIT OF THE CASE. IT IS A CASE OF THE ASSESSEE IS THAT THE APPELLANT TRUST WA S CREATED VIDE TRUST DEED DATED 30.05.2016 AND THEREAF TER, THE APPLICATION FOR GRANT OF REGISTRATION U/S 12A OF THE ACT WAS FILED ON 29.03.2017, HOWEVER, IN THE ORDER IMPUGNED HERE IN, THE DATE OF FILING OF APPLICATION FOR REGISTRATION IS MENT IONED AS 20 TH APRIL, 2017. THE APPELLANT HAS ALSO FILED COPY OF THE APPLICATION IN FORM NO.10A FOR REGISTRATION OF TRUST U/S 12AA OF T HE ACT. THE NOTICE FOR HEARING BY THE DCIT WAS ISSUED ON 06.09.20 17 WHICH REMAINED UNDELIVERED, THEREAFTER, SECOND NOTICE ISSUED ON 25 TH SEP., 2017 WAS RECEIVED BY THE APPELLANT AND IN RESPON SE TO WHICH, THE COMPLETE REPLY WAS SENT BY SPEED POST ON 18.10 .2017 BY THE APPELLANT TRUST AND THEREAFTER MR. DHARAM PAL PARASHAR WHO IS THE TRUSTEE OF THE APPELLANT TRUST ALSO APPEARED BEFORE THE LD. CIT(E) ON 24.10.2017 AND ON THAT PARTICULAR DATE SOME ADDITIONAL QUERIES HAVE BEEN RAISED, WHICH WERE ALSO RE PLIED BY THE APPELLANT TRUST THROUGH E-MAIL DATED 26.10.2017 , HOWEVER, LATER ON, IT WAS REVEALED BY THE APPELLANT TRUST THAT THE ORDER IMPUGNED HEREIN HAS ALREADY BEEN PASSED ON 25 TH OCTOBER, ITA NO.775(ASR)/2017 SWAMI SUDERSHANA ACHARYA JI MAHARAJ CHARITABLE SOCIETY V. CIT(E) 3 2017, THEREFORE, THE APPELLANT TRUST HAS RAISED THE A DDITIONAL GROUND BY SUBMITTING THAT ORDER HEREIN WAS PASSED BEYON D THE PERIOD OF SIX MONTHS FROM THE DATE OF FILING OF APPLI CATION FOR REGISTRATION . AS THE APPLICATION IN FORM NO.10(A) WAS FILED ON 29 TH MARCH, 2017 BEFORE THE LD. CIT(A)-2, AMRITSAR WHEREA S THE DATE OF SUBMISSION OF APPLICATION HAS BEEN MENTIONED AS 20 TH APRIL, 2017 IN THE IMPUGNED ORDER. THE LD. AR OF THE APPELLANT SOCIETY ALSO RELIED UPON T HE JUDGMENT PASSED BY THE APEX COURT IN THE CASE OF CIT & ORS VS. SOCIETY FOR THE PROMOTION OF EDUCATION ADVENTURE SPOR T & CONSERVATION OF ENVIRONMENT [2016] 284 ITR 06 (SC) . FURTHER THE LD. AR ALSO RELIED UPON THE JUDGMENT PASSED BY THE CO- ORDINATE BENCH AT AMRITSAR IN THE CASE OF SAI SHYAM EDUCATION SOCIETY, JAMMU VS. ITO IN ITA NO. 567(ASR)/2014 AND SUBMITTED THAT AFORESAID DECISION OF THE APEX COURT WAS FOLLOWED IN THIS CASE BY THE CO-ORDINATE BENCH AT AMRITSAR. 5. ON THE OTHER HAND, THE LD. CIT-DR HAS SUBMITTED THAT ALTHOUGH THE APPLICATION IN FORM NO.10A WAS FILED ON 29 TH MARCH, 2017 BUT THE SAME WAS FILED ONLY BEFORE THE LD. CIT-2 , AMRITSAR WHO WAS INCOMPETENT TO DECIDE THE SAID APPLICATION THER EFORE FORWARDED THE SAME TO THE OFFICE OF CIT(E) CHANDIGARH , WHICH WAS RECEIVED AT THE OFFICE OF THE LD. CIT(E) ONLY ON 2 0 TH APRIL, 2017 AND THE ORDER UNDER CHALLENGE HAS BEEN PASSED ON 25.10.2017, THEREFORE, THE SAME IS WITHIN THE SIX MON THS OF THE FILING OF THE APPLICATION, HENCE, THE ADDITIONAL GROU ND CANNOT BE ENTERTAINED. 6. WE HAVE PERUSED THE ORDER PASSED BY THE LD. CIT(E) AN D ALSO CONSIDERED THE RIVAL SUBMISSIONS OF THE PARTIES. ITA NO.775(ASR)/2017 SWAMI SUDERSHANA ACHARYA JI MAHARAJ CHARITABLE SOCIETY V. CIT(E) 4 LET US TO REPRODUCE THE RELEVANT PROVISION OF SEC.12AA OF THE I.T. ACT FOR ADJUDICATION OF THE ADDIT IONAL GROUND. SECTION 12AA (1) THE CHIEF COMMISSIONER OR COMMISSIONER, ON RECE IPT OF AN APPLICATION FOR REGISTRATION OF A TRUST OR INSTITUT ION MADE UNDER CLAUSE (A) [OR CLAUSE (AA) OF SUB-SECTION (1) ] OF SECTION 12A , SHALL (A) CALL FOR SUCH DOCUMENTS OR INFORMATION FROM THE TRUST OR INSTITUTION AS HE THINKS NECESSARY IN ORDER TO SATI SFY HIMSELF ABOUT THE GENUINENESS OF ACTIVITIES OF THE TRUST OR INSTITUTION AND MAY ALSO MAKE SUCH INQUIRIES AS HE MAY DEEM NECESSARY IN THIS BEHALF; AND (B) AFTER SATISFYING HIMSELF ABOUT THE OBJECTS OF T HE TRUST OR INSTITUTION AND THE GENUINENESS OF ITS ACTIVITIES, HE - (I) SHALL PASS AN ORDER IN WRITING REGISTERING THE TRUST OR INSTITUTION; (II) SHALL, IF HE IS NOT SO SATISFIED, PASS AN ORDE R IN WRITING REFUSING TO REGISTER THE TRUST OR INSTITUTION, AND A COPY OF SUCH ORDER SHALL BE SENT TO THE APPLI CANT : PROVIDED THAT NO ORDER UNDER SUB-CLAUSE (II) SHALL BE PASSE D UNLESS THE APPLICANT HAS BEEN GIVEN A REASONABLE OPPORTUNITY OF BEING HEARD. (2) EVERY ORDER GRANTING OR REFUSING REGISTRATION UNDER CLAUSE (B) OF SUB-SECTION (1) SHALL BE PASSED BEFORE THE EXPIRY OF SIX MONTHS FROM THE END OF THE MONTH IN WHICH THE APPLICATION WAS RECEIVED UNDER CLAUSE (A) OF SECTION 12A.] 7. SEC.12AA(2) MANDATES THAT EVERY ORDER GRANTING OR REFUSING REGISTRATION UNDER CLAUSE(B) OF SUB-SECTION (1) SHALL BE PASSED BEFORE THE EXPIRY OF THE SIX MONTHS FROM THE END OF THE MONTH IN WHICH THE APPLICATION WAS RECEIVED UNDER CLAUSE -(A) OR CLAUSE (AA) OR CLAUSE(AB) OF SUB-SECTION (1) OF SEC.12A. THE APEX COURT IN THE CASE OF CIT & ORS VS. SOCIETY FOR THE ITA NO.775(ASR)/2017 SWAMI SUDERSHANA ACHARYA JI MAHARAJ CHARITABLE SOCIETY V. CIT(E) 5 PROMOTION OF EDUCATION ADVENTURE SPORT & CONSERVATIO N OF ENVIRONMENT (SUPRA) HAS LAID DOWN THE RATIO ' IF NO ORDER IS PASSED WITHIN THE PERIOD OF SIX MONTHS FROM THE DAT E OF FILING OF APPLICATION FOR REGISTRATION U/S 12AA, IT WILL BE DEEMED TO HAVE GRANTED REGISTRATION '. 8. WHILE COMING TO THE INSTANT CASE, IT IS ADMITTED FACT T HAT THE APPELLANT TRUST HAD FILED AN APPLICATION FOR REG ISTRATION BEFORE THE CIT-2, AMRITSAR ON 29 TH MARCH, 2017, HOWEVER, THE SAME WAS TRANSMITTED BY THE CIT-2, AMRITSAR TO THE OFFICE O F CIT(E) WHERE IT WAS RECEIVED ONLY ON 20 TH APRIL, 2017 AND THEREAFTER, THE ORDER WAS PASSED ON 25 TH OCTOBER, 2017 WHICH IS CLEARLY WITHIN THE MONTH FROM THE END OF MONTH IN WHICH THE APPLICATION WAS RECEIVED, HOWEVER, IT WAS CLAIMED BY THE APPELLANT TRUST THAT THE APPLICATION WAS FILED ON 23 RD MARCH, 2017 BEFORE THE CIT-2, AMRITSAR, THEREFORE, THE DATE OF APPLICATION HAS TO BE CONSIDERED AS 23 TH MARCH, 2017, BUT WE ARE NOT IN CONCURRENCE WITH THE SUBMISSION OF THE APPELLANT TRUST BECAUSE FILING OF APPL ICATION BEFORE THE IN-COMPETENT AUTHORITY DOES NOT ENTITLE TH E APPLICANT TO CLAIM AS FILED BEFORE THE COMPETENT AUTHORITY AND D ATE OF THE APPLICATION HAS TO BE CONSIDERED WHEN IT IS ACTUALLY RECE IVED BY THE COMPETENT AUTHORITY WHO IS HAVING JURISDICTION TO D ECIDE SUCH APPLICATION, HENCE, WE DO NOT HAVE ANY HESITATION TO H OLD THAT APPLICATION WAS RECEIVED ONLY ON 20 TH APRIL 2017 BY THE COMPETENT AUTHORITY I.E., CIT(E), CHANDIGARH WHO WAS COMPETENT TO DECIDE THE APPLICATION AND THEREAFTER HE PASSED THE ORDER ON 25 TH OCTOBER, 2017 WHICH IS WITHIN 06 MONTHS AS PRESCRIBED BY LAW. ITA NO.775(ASR)/2017 SWAMI SUDERSHANA ACHARYA JI MAHARAJ CHARITABLE SOCIETY V. CIT(E) 6 IN THE RESULT, THE ADDITIONAL GROUND RAISED BY THE AP PELLANT TRUST, STANDS REJECTED. 9. NOW COMING TO THE MERIT OF THE CASE, THE APPLICATION U/S 12AA OF THE ACT WAS RECEIVED ON 20 TH APRIL, 2017 BY THE LD. CIT(E) WHICH WAS TAKEN INTO CONSIDERATION WHILE FIXING THE DATE OF HEARING ON 29 TH AUGUST, 2017 AND THEREAFTER, THE SHOW CAUSE LETTER WAS ISSUED TO THE APPELLANT TRUST BY FIXING THE CASE FOR 12.09.2017 AND CERTAIN QUERIES AS MENTIONED IN PARA NO .2 OF THE ORDER HAVE BEEN RAISED, HOWEVER, THE AFORESAID SHOW CA USE NOTICE REMAINED UNDELIVERED, THEREAFTER ANOTHER LETT ER WAS ISSUED BY FIXING THE CASE FOR 3 RD OCTOBER AND THE APPELLANT TRUST WAS REQUESTED TO PROVIDE RESPONSE TO THE QUERIES OF THE SHOW CAUSE NOTICE LETTER DATED 29 TH AUGUST, 2017, HOWEVER, NO ONE ATTENDED ON BEHALF OF THE APPELLANT TRUST, THEREAFTE R ONE E-MAIL WAS RECEIVED ON THE OFFICIAL E-MAIL ID OF THE LD. CIT( E) ON 04.10.2017 FOR SEEKING ADJOURNMENT, IN RESPONSE TO WHI CH, THE FINAL OPPORTUNITY WAS GRANTED BY FIXING THE DATE OF HEARING FOR 10.10.2017, HOWEVER, ON 11.10.2017, THE LD. AR OF T HE APPELLANT TRUST AGAIN SOUGHT ADJOURNMENT FOR A WEAK TIME SIGHTIN G SOME MEDICAL CONSTRAINTS AND THEREAFTER, THE LD. CIT(E) DI D NOT RECEIVE ANY RESPONSE TILL PASSING OF THE ORDER AND FINA LLY PASSED THE IMPUGNED ORDER BY OBSERVING THAT IN VIEW OF THE LACK OF SUBMISSIONS IN RESPONSE TO THE DEPARTMENTS QUERIES IN THE MATTER, THE QUERIES ASKED VIDE THE AFORESAID SHOW CAUSE LET TER REMAINED UNEXPLAINED. GIVEN THE ABOVE, THERE IS NO WAY THE G ENUINENESS OF ACTIVITIES OF THE TRUST CAN BE VERIFIED. IN VIEW O F THIS, THE APPLICATION FOR GRANT OF APPROVAL U/S 12AA IS ACCORDINGLY REJEC TED . ITA NO.775(ASR)/2017 SWAMI SUDERSHANA ACHARYA JI MAHARAJ CHARITABLE SOCIETY V. CIT(E) 7 10. DURING THE COURSE OF HEARING OF THE INSTANT APPEAL, THE LD. AR HAD SUBMITTED THAT ALTHOUGH THE APPLICATION WAS FIL ED ON 29 TH MARCH, 2017, HOWEVER, THE APPLICATION FOR CONSIDERATION WAS TAKEN AT VERY LATE STAGE ON 06.09.2017 BY ISSUING THE NOTICE WHICH WAS NEVER BEEN SERVED UPON THE APPELLANT SOCIETY AND THEREAFTER THE SECOND NOTICE WAS ISSUED, WHILE FIXING THE DATE OF HEARING ON 25.09.2017 AND THEREAFTER ON 4 TH OCTOBER, 2017 AND 11 TH OCTOBER, 2017 THE APPLICANT TRUST DULY COMMUNICATED WI TH THE LD. CIT(E) AND EVEN OTHERWISE, ON DATED 18.10.20 17 THE APPELLANT SOCIETY HAS SENT COMPLETE REPLY TO THE SHOW CAU SE NOTICE BY SPEED POST VIDE RECEIPT NO. EP408794611IN AND FURTHER MR. DHARAM PAL PARASHAR, THE TRUSTEE OF THE A PPELLANT ALSO APPEARED PERSONALLY ON 24 TH OCTOBER, 2017 AND SOME ADDITIONAL QUERIES HAVE BEEN RAISED WHICH WERE ALSO REP LIED BY THE APPELLANT THROUGH E-MAIL DATED 26.10.2017. IT W AS ALSO EMPHASIZED BY THE LD. AR THAT EVEN OTHERWISE AFTER RE CEIVING THE REPLY FROM THE APPELLANT TRUST, NO OPPORTUNITY WAS ACCORDED TO THE APPELLANT TRUST, EITHER TO SUBSTANTIATE THE CLAIM/ DOCUMENTS OR TO REPLY THE POSED QUESTION(S), IF ANY, ON WHICH TH E LD. CIT(E) HAS TAKEN ADVERSE VIEW. AS THE PROPER OPPORTUNITIES OF BEING HEARD WERE NOT PROVIDED BY THE LD. CIT(E) WHILE DECIDING THE APPLICA TION OF THE APPELLANT TRUST AND EVEN REPLY AND MATERIAL DOCUMENTS SENT BY THE APPELLANT TRUST THROUGH SPEED POST DATED 18.10.201 7 AS WELL AS THROUGH E-MAIL DATED 26 TH OCTOBER, 2017 WHICH WERE ESSENTIAL TO SUBSTANTIATE THE CLAIM OF THE APPELLANT TRUST TO MEE T THE REQUIREMENTS AS PRESCRIBED U/S 12AA OF THE ACT, HAVE BEEN SIDELINED OR MAY BE OVER SIGHTED BY THE LD. CIT(E), THEREFORE, IN ITA NO.775(ASR)/2017 SWAMI SUDERSHANA ACHARYA JI MAHARAJ CHARITABLE SOCIETY V. CIT(E) 8 OUR CONSIDERED OPINION, THE ORDER UNDER CHALLENGE CAN N OT SUSTAIN AND RESULTANTLY THE SAME IS SET ASIDE. THE LD. CIT (E) IS DIRECTED TO PASS A SPEAKING ORDER AFRESH WITHIN THREE MO NTHS FROM THE DATE OF THIS ORDER WHILE OFFERING REASONABLE OPPORTUNITIES OF BEING HEARD TO THE APPELLANT TRUST. 8 . IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLO WED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 14.09.2018. SD/- SD/- (SANJAY ARORA) (N.K.CHOUDHRY) ACCOUNTANT MEMBER JU DICIAL MEMBER DATED:14.09.2018 /PK/ PS. COPY OF THE ORDER FORWARDED TO: (1) SWAMI SUDESHAN ACHARYA JI MAHARAJ CHARITABL E SOCIETY, INSIDE MUKTINARAYAN DHAM VENKATESH MANDIR, GREEN FIELD MAJITHA ROAD, AMRITSAR (2) THE CIT (EXEMPTIONS), CHANDIGARH (3) THE SR DR, I.T.A.T., AMRITSAR TRUE COPY BY ORDER