U.P State Highways Authority, Lucknow V. Income Tax Officer-1(4), Lucknow

ITA 810/LKW/2013

• Counselvise Citation: 81023714 RSA 2013
• Duration Of Justice: 4 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-05-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 26-05-2014
• Assessment Year: 2010-2011
• Appeal Filed On: 30-12-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ALOK MITRA
• Assessee Lawyers: P K KAPOOR
• Keywords: Charitable institution; Opportunity of being heard; Principle of natural justice; Condonation of delay
• Section: 143(3); 12A; 12AA; 6; 12

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH SMD , LUCKNOW BEFORE SHRI S UNIL KUMAR YADAV , JUDICIAL MEMBER AND SHRI. A. K. GARODIA , ACCOUNTANT MEMBER ITA NO. 810/LKW/2013 ASSESSMENT YEAR: 2010 - 11 U.P. STATE HIGHWAYS AUTHORITY LUCKNOW V. INCO ME TAX OFFICER 1(4) LUCKNOW PAN: AAALU0131G (APP ELL ANT) (RESPONDENT) APP ELL ANT BY: SHRI. P. K. KAPOOR, C.A. RESPONDENT BY: SHRI. ALOK MITRA, D.R. DATE OF HEARING: 26 05 2014 DATE OF PRONOUNCEMENT: 29 05 2014 O R D E R PER SUNIL KUMAR YADAV: THIS APPEAL IS PREFERRED BY THE ASSESSEE AGAINST THE ORDER OF THE LD. CIT(A) , INTER ALIA, ON THE FOLLOWING GROUNDS: - 1 . BECAUSE THE ID. 'CIT(A)' HAS ERRED IN LAW AND ON FACTS IN UPHOLDING THE ASSESSMENT OF INCOME AT RS. 80,805/ - AS HAS BEEN MADE BY THE ASSES SING OFFICER VIDE ASSESSMENT ORDER PASSED UNDER SECTION 143(3) OF THE 'ACT'. 2 . BECAUSE MERELY FOR THE REASON THAT THE APPELLANT AUTHORITY'S APPLICATION FOR REGISTRATION UNDER SECTION 12AA IS PENDING FOR DECISION AT THE END OF ID 'CIT - I', LUCKNOW IN PURSUANC E OF ORDER DATED 06.06.2012 PASSED BY HON'BLE ITAT, LUCKNOW BENCH 'A', LUCKNOW IN ITA NO. 703/LKW - 2010 WITH THE DIRECTION READING AS 'WE ACCORDINGLY SET ASIDE THE ORDER OF LD.'CIT' AND RESTORE THE MATTER TO HIS FILE WITH A DIRECTION TO PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 2 - : RE - ADJUDICATE THE IS SUE AFRESH IN THE LIGHT OF RELEVANT MATERIAL AND AFORESAID RULES AFTER AFFORDING .AN OPPORTUNITY OF BEING HEARD TO THE ASSESSEE', THE ASSESSEE'S RIGHT TO CLAIM EXEMPTION UNDER SECTION 11 OF THE 'ACT' COULD NOT BE JEOPARDIZED. 3 . BECAUSE THE APPELLANT AUTHORI TY HAS BEEN CONSTITUTED IN ACCORDANCE WITH THE PROVISIONS OF SECTION 3 OF U.P. ACT NO. 19 OF 2004, TO CARRY OUT FUNCTIONS AND DUTIES SPECIFIED IN THE SAID STATUTE, IT DESERVED TO BE HELD AS AN INSTITUTION EXISTING FOR CHARITABLE PURPOSE AND ACCORDINGLY, IT S CLAIM OF EXEMPTION UNDER SECTION 11 READ WITH SECTION 12 OF THE 'ACT' COULD NOT BE DENIED BY THE AUTHORITIES BELOW. 4 . BECAUSE THE INCOME OF APPELLANT AUTHORITY WAS LIABLE TO BE ASSESSED ON THE BASIS OF COMPUTATION FURNISHED BY IT IN ACCORDANCE WITH PROVIS IONS OF SECTION 11 READ WITH SECTION 12 OF THE 'ACT' AND ACCORDINGLY, 'CIT(A)' SHOULD HAVE DIRECTED THE ASSESSING OFFICER TO RE - COMPUTE THE INCOME BY APPLYING THE SAID PROVISION OF THE 'ACT'. 5 . BECAUSE IN ANY CASE THE APPELLANT AUTHORITY HAS ALL THE ATTRIBU TES OF BEING A LOCAL AUTHORITY AS DEFINED UNDER SECTION 10(20) OF THE 'ACT', THE ID. 'CIT(A)' HAS ERRED IN LAW AND ON FACTS IN HOLDING THAT THE APPELLANT AUTHORITY WAS NOT ELIGIBLE FOR EXEMPTION UNDER SECTION 10(20). 6 . BECAUSE THE ORDER APPEALED AGAINST IS CONTRARY TO THE FACTS, LAW AND PRINCIPLES OF NATURAL JUSTICE. 2 . DURING THE COURSE OF HEARING OF THE APPEAL, IT WAS POINTED OUT THAT THIS APPEAL IS BARRED BY TIME , AS THERE WAS A DELAY OF 10 DAYS IN FILING THE APPEAL. THE ASSESSEE HAS MOVED AN APPLICATION F OR CONDONATION OF DELAY IN PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 3 - : FILLING THE APPEAL, STATING THEREIN THAT THE CONCERNED OFFICER, LOOKING AFTER THE INCOME TAX MATTERS, GOT BUSY IN MAKING PREPARATION FOR VARIOUS MEETINGS OF THE ASSESSEE AND OTHER GOVERNMENT DEPARTMENTS WITH WHICH HE IS ASSOCIATE D IN VARIOUS CAPACITIES DURING THAT PERIOD, AND AS SUCH HE COULD NOT SIGN AND RETURN THE APPEAL PAPERS TO THE COUNSEL FOR FILING THE SAME WITHIN THE DUE DATE. IN SUPPORT OF THESE CONTENTIONS, AN AFFIDAVIT OF MEMBER (FINANCE) OF THE ASSESSEE IS ALSO FILED. 3 . HAVING CAREFULLY EXAMINED THE AFFIDAVIT AND THE APPLICATION FOR CONDONATION OF DELAY, WE FIND MERIT THEREIN AND WE ACCORDINGLY CONDONE THE DELAY OF 10 DAYS IN FILING THE APPEAL AND ADMIT THE APPEAL FOR HEARING. 4 . THOUGH VARIOUS GROUNDS ARE RAISED, BUT THEY ALL RELATE TO THE DENIAL OF CLAIM OF EXEMPTION UNDER SECTION 11 OF THE INCOME - TAX ACT, 1961 (HEREINAFTER CALLED IN SHORT THE ACT') ON THE GROUND THAT REGISTRATION UNDER SECTION 12AA OF THE ACT HAS NOT BEEN GRANTED TO THE ASSESSEE. IN THIS REGARD, THE LD. COUNSEL FOR THE ASSESSEE, SHRI. PRADEEP KUMAR KAPOOR, C.A. HAS INVITED OUR ATTENTION THAT AGAINST DENIAL OF REGISTRATION UNDER SECTION 12A OF THE ACT, THE ASSESSEE PREFERRED AN APPEAL BEFORE THE TRIBUNAL AND THE TRIBUNAL VIDE ITS ORDER DATED 6.6.2012 DIR ECTED THE LD. COMMISSIONER OF INCOME - TAX TO RE - ADJUDICATE THE ISSUE OF REGISTRATION UNDER SECTION 12A OF THE ACT IN THE LIGHT OF U.P. STATE HIGHWAYS THE DETERMINATION OF RATES AND COLLECTION OF TOLLS RULES, 2011, BUT THE LD. CIT(A) HAS NOT PASSED ANY ORD ER GRANTING OR DENYING REGISTRATION UNDER SECTION 12A OF THE ACT AND THE MATTER IS STILL PENDING WITH HIM. THE LD. COUNSEL FOR THE ASSESSEE HAS FURTHER CONTENDED THAT IN VIEW OF VARIOUS ORDERS OF THE TRIBUNAL, PARTICULARLY IN THE CASE OF HARSHIT FOUNDATIO N, JAUNPUR VS. CIT, FAIZABAD IN ITA NOS. 104 & 105/LUC/2012 AND THE JUDGMENT OF THE HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF SOCIETY FOR THE PROMOTION OF EDUCATION ADVENTURE SPORT & CONSERVATION OF ENVIRONMENT VS. CIT & OTHERS [2008] 216 CTR 167, I F THE LD. COMMISSIONER OF INCOME - TAX DOES NOT GRANT REGISTRATION WITHIN A PERIOD PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 4 - : OF SIX MONTHS FROM THE DATE OR RECEIPT OF THE ORDER OF THE TRIBUNAL, REGISTRATION UNDER SECTION 12A OF THE ACT IS DEEMED TO HAVE BEEN GRANTED TO THE ASSESSEE. IN THE LIGHT OF THIS PROPOSITION, REGISTRATION IS DEEMED TO HAVE BEEN GRANTED TO THE ASSESSEE AND THE ASSESSEE IS ENTITLED FOR EXEMPTION UNDER SECTION 11 OF THE ACT. 5 . THE LD. D.R., ON THE OTHER HAND, HAS PLACED RELIANCE UPON THE ORDER OF THE LD. CIT(A). 6 . HAVING GIVEN A THO UGHTFUL CONSIDERATION TO THE RIVAL SUBMISSIONS, WE FIND THAT THE TRIBUNAL VIDE ITS ORDER DATED 6.6.2012 DIRECTED THE LD. COMMISSIONER OF INCOME - TAX TO RE - ADJUDICATE THE ISSUE OF GRANT OF REGISTRATION UNDER SECTION 12A OF THE ACT. DESPITE LAPSE OF ALMOST T WO YEARS, THE LD. COMMISSIONER OF INCOME - TAX HAS NOT PASSED ANY CONSEQUENTIAL ORDER. THEREFORE, IN THE LIGHT OF THE ORDER OF THE TRIBUNAL IN THE CASE OF HARSHIT FOUNDATION, JAUNPUR VS. CIT, FAIZABAD (SUPRA) AND THE JUDGMENT OF THE HON'BLE JURISDICTIONAL H IGH COURT, THE REGISTRATION IS DEEMED TO HAVE BEEN GRANTED TO THE ASSESSEE. THE RELEVANT OBSERVATIONS OF THE TRIBUNAL IN THE CASE OF HARSHIT FOUNDATION, JAUNPUR VS. CIT, FAIZABAD (SUPRA) VIDE ORDER DATED 28.6.2013 ARE REPRODUCED AS UNDER: - 4. IN OUR CON SIDERED VIEW, PLEA OF THE ASSESSEE DESERVES TO BE ACCEPTED IN THE LIGHT OF HON'BLE JURISDICTIONAL HIGH COURT'S JUDGMENT IN THE CASE OF SOCIETY FOR PROMOTION OF EDUCATION, ADVENTURE SPORTS AND CONSERVATION OF ENVIRONMENT (SUPRA), WHEREIN THEIR LORDSHIPS HAV E, INTER ALIA, OBSERVED AS FOLLOWS: - 'THE APEX COURT HAS ALSO APPLIED DOCTRINE OF PURPOSIVE INTERPRETATION IN FISCAL STATUTES THAT WOULD BE EVIDENT FROM ITS DECISION IN CIT VS. ANJUM M.H . GHASWALA & ORS. (2001) 171 CTR (SC) 1 : JT 2001 (9) SC 61. CONSIDERI NG THE PROS AND CONS OF THE TWO VIEWS, WE ARE OF THE OPINION THAT BY FAR THE BETTER INTERPRETATION WOULD BE TO HOLD THAT THE EFFECT OF NON - CONSIDERATION OF THE APPLICATION FOR REGISTRATION WITHIN THE TIME FIXED BY SECTION 12AA(2) WOULD BE A DEEMED GRANT OF PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 5 - : REGISTRATION. WE DO NOT FIND ANY GOOD REASON TO MAKE THE ASSESSEE SUFFER BECAUSE THE IT DEPARTMENT IS NOT ABLE TO KEEP ITS OFFICERS UNDER CHECK AND CONTROL, SO AS TO TAKE TIMELY DECISIONS IN SUCH SIMPLE MATTERS SUCH AS CONSIDERATION OF APPLICATIONS FOR RE GISTRATION EVEN WITHIN THE LARGE SIX MONTH PERIOD PROVIDED BY S. 12AA(2) OF THE ACT. WE ACCORDINGLY DIRECT THE RESPONDENTS, SUBJECT TO ANY ORDER WHICH MAY BE PASSED UNDER S. 12AA(3), TO TREAT THE PETITIONER SOCIETY AS AN INSTITUTION DULY APPROVED AND REGIS TERED UNDER S. 12AA AND TO RECOMPUTED ITS INCOME BY APPLYING THE PROVISION OF S.11 OF THE ACT. ACCORDINGLY, A FORMAL CERTIFICATE OF APPROVAL WILL BE ISSUED FORTHWITH TO THE PETITIONER BY THE RESPONDENT NO.2.' 5. APPLYING THE PRINCIPLE SO LAID DOWN, WHERE C OMMISSIONER DOES NOT PASS ANY ORDERS EVEN AFTER SIX MONTHS FROM RECEIPT OF TRIBUNAL'S ORDER REMITTING THE MATTER TO HIM. THE REGISTRATION WILL BE DEEMED TO HAVE BEEN GRANTED. OF COURSE, THIS IS SUBJECT TO EXERCISE OF COMMISSIONER'S POWER U/S. 1 2AA(3) IN APP ROPRIATE CASES, BUT THE REGISTRATION WILL BE DEEMED TO HAVE BEEN GRANTED. 6. FOR THE REASONS SET OUT ABOVE, WE UPHOLD THE PRELIMINARY OBJECTION RAISED BY THE ASSESSEE AND DIRECT THE COMMISSIONER TO ISSUE APPROVAL OF REGISTRATION FORTHWITH. IN THIS VIEW OF THE MATTER, WE SEE NO NEED TO DEAL WITH OTHER LEGAL AND FACTUAL ISSUES RAISED BY THE ASSESSEE. 7 . BUT IN ANY CASE , REGISTRATION HAS NOT SO FAR BEEN GRANTED TO THE ASSESSEE . T HEREFORE, WITH OUT GRANT OF REGISTRATION BY THE LD. COMMISSIONER OF INCOME - TAX , BE NEFIT OF EXEMPTION UNDER SECTION 11 OF THE ACT CANNOT BE ALLOWED TO THE ASSESSEE. WE, HOWEVER, IN THE INTEREST OF JUSTICE SET ASIDE THE ORDER OF THE LD. CIT(A) AND RESTORE THE MATTER TO THE FILE OF THE ASSESSING OFFICER TO RE - ADJUDICATE THE ISSUE OF CLAIM OF EXEMPTION UNDER SECTION 11 OF THE ACT AFTER RECEIPT OF THE ORDER OF THE LD. COMMISSIONER OF INCOME - TAX UNDER SECTION 12A OF THE ACT IN THE LIGHT OF THE AFORESAID ORDER OF THE TRIBUNAL IN THE CASE OF HARSHIT FOUNDATION, JAUNPUR VS. CIT, FAIZABAD PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 6 - : (SUPRA) AND THE JUDGMENT OF THE HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF SOCIETY FOR THE PROMOTION OF EDUCATION ADVENTURE SPORT & CONSERVATION OF ENVIRONMENT VS. CIT & OTHERS (SUPRA). WHILE DOING SO, THE ASSESSING OFFICER SHALL AFFORD AN OPPORTUNITY OF B EING HEARD TO THE ASSESSEE AND ALSO TO EXAMINE THE ISSUE OF ENTITLEMENT OF EXEMPTION UNDER SECTION 11 OF THE ACT IN THE LIGHT OF THE RELEVANT PROVISIONS OF LAW. 8 . IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 29.5.2014. SD/ - SD/ - [ A. K. GARODIA ] [ S UNIL KUMAR Y ADAV ] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 29 TH MAY , 2014 JJ: 2605 COPY FORWARDED TO: 1 . APPELLANT 2 . RESPONDENT 3 . CIT(A) 4 . CIT 5 . DR ASSISTANT REGISTRAR PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ )