Quami It Ahadi Muslim Welfare Society, Noorpur V. CIT(E), Lucknow

ITA 78/DEL/2021

• Counselvise Citation: [2024] 100 COUNSELVISE.COM (IT) 4263 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 11 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-01-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: H
• Next Hearing Date: 31-10-2023
• Assessment Year: misc
• Appeal Filed On: 04-02-2021
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Principle of natural justice
• Section: 12A; 12AA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘H’, NEW DELHI Before Dr. B. R. R. Kumar, Accountant Member, Shri Yogesh Kumar US, Judicial Member ITA No. 78/Del/2021 Quami IT Ahadi Muslim Welfare Society, Near Bus Stand, Noorpur, UP 246701 Vs The CIT(E), Lucknow (APPELLANT) (RESPONDENT) PAN No. AAAAQ 0323 M Assessee by : Written Application Revenue by : Ms. Sapna Bhatia, CIT-DR Date of Hearing: 01.11.2023 Date of Pronouncement: 18.01.2024 ORDER Per Dr. B. R. R. Kumar:- The present appeal has been filed by the assessee against the order of ld. CIT(E) dated 09.12.2020. 2. The assessee has raised the following grounds of appeal:- 1. Th at th e ord er of th e h on ou rab l e CI T- E x em p i s ill eg al, arb it ra ry and un ju st . 2. Th at th e soci ety i s d oin g v ari ou s c hari tab l e a cti vit i es l ik e di st ri bu ti ng of b la n ket s , s ch ol a rsh ip s ,h el p i ng p Oo r g i rl s i n t h ei r ma rriag es . 3. Th at t h e as s ess e h as g i v en p rop er ev i den c es and v ouc h ers of cha ri t ab l e a cti vit i es . 4. Th at th e A ss es see i s g ivi ng i n t erest f ree ad van c es to p oors an d ta ki ng a m an at s f rom g en eral ma ss es whi ch i s all ow ed in I sl am i c fin an ce. Th a t th is obj ect i s p rop erly m en ti on ed i n ou r M emo rand um of A s s ociat ion . ITA No. 78/Del/2021 Quami IT Ahadi Muslim Welfare Society 2 5. Th at du e t o C OVID 2019 ,it wa s n ot p os si bl e f or t h e as s es se t o c om e p ers onal l y Lu c know 3. The above named society/trust has filed an application for registration u/s 12A(a) of the Income Tax Act, 1961 on 12.10.2019 with the Commissioner of Income Tax(Exemptions),Lucknow. The applicant was accorded an opportunity of being heard by the CIT(E), Lucknow vide office letter F.No. ITBA/EXM/F/42/2020-21/1027110128(1) dated 12.05.2020, sent to the applicant at the address provided in its PAN through Speed Post and simultaneously posted on its e- filling portal also, calling for specific queries regarding its application for registration u/s 12A of the Act, for compliance on 18.06.2020 but no compliance has been made. In the interest of natural justice two more opportunities of being heard were provided to the assessee vide this office letter F.No. ITBA/EXM/F/41/2020-21/1027171099(1) dated 28.05.2020 for compliance on 15.06.2020. 4. The ld. CIT(E) held that as per the section 12AA(1) (a) of the Income Tax Act, 1961 "The Commissioner shall call for s uch documents or information from the trust or institution as he thinks necessary in order to satisfy himself about the genuineness of the trust or institution. Thus it becom es imperative on the part of the applicant society to provide corroborating evidences regarding the genuineness of the activities of the applicant which is mandated by law. In the absence of such satisfaction, the applicant looses its eligibility for consideration for registration u/s 12A of the Act." 5. The ld. CIT(E) held that on examination of the annual accounts of the society, it is noticed that the society is involved in disbursing loan for fee/interest. A perusal of the Balance Sheet and Income & Expenditure account shows that the society ITA No. 78/Del/2021 Quami IT Ahadi Muslim Welfare Society 3 has given loan to the tune of Rs. 3,88,37,550/-and received the fee against these loan amounting to Rs. 26,07,953/-during F.Y. 2018-19. The ld. CIT(E) held that the society has not incurred any expenses charitable activities other than meager amount of Rs. 2,24,015/- under vague head in the name of Social Welfare but no evidence such as bills and vouchers etc has been submitted by the applicant to substantiate its claim of charitable activities. 6. The ld. CIT(E) held that, it is also noted that the object of the society does not have any such clause for disbursing for fee/interest, however as per annual accounts of the society the major income and expenditure are related to these activities. Therefore it is evident that the society is not engaged in carrying out any kind of charitable activities in the pursuit of its objects, hence it is not considered is eligible to registration u/s 12AA of the Income Tax Act, 1961. Holding thus the ld. CIT(E) rejected registration under section 12AA of the Income Tax Act. 7. Aggrieved, the assessee filed appeal before the ITAT. 8. Heard the arguments of ld. DR & written submission of the assessee and perused the material available on record. 9. Having gone through the entire facts before us, we find that no prejudice would be causes to the Revenue, if the matter is remanded back to ld. CIT(E) for examination of the issue denovo. The assessee shall present himself before the ld. CIT(E) ITA No. 78/Del/2021 Quami IT Ahadi Muslim Welfare Society 4 and furnish all the relevant details sought without seeking unnecessary adjournments. 10. In the result, the appeal of the assessee is allowed for statistical purpose. Order Pronounced in the Open Court on 18/01/2024. Sd/- Sd/- (Yogesh Kumar US) (Dr. B. R. R. Kumar) Judicial Member Accountant Member Dated: 18/01/2024 *NV, Sr. PS* Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT, DELHI Date 1. Draft Dictated on computer direct 16.01.2024 2. Draft placed before the author 16.01.2024 3. Draft placed before the other Member .01.2024 4. Approved Draft comes to the Sr.PS/PS .01.2024 5. Order uploaded on .01.2024 6. File sent to the Bench Clerk .01.2024 7. Date on which file goes to the Head Clerk. 8. Date on which file goes to the AR 9. Date of dispatch of Order.