THE COMMISSIONER OF INCOME TAX, V. M/S VISVESVARAYA TECHNOLOGICAL UNIVERSITY

ITA/5003/2012

AI Insights

The case involves the Commissioner of Income Tax, Belgaum as the appellant and M/s. Visvesvaraya Technological University as the respondent. The core issue was the withdrawal of the exemption certificate under Section 80G of the Income Tax Act by the Commissioner, which was later contested and reversed by the Income Tax Appellate Tribunal. The Tribunal's decision was based on the lack of procedural compliance by the Commissioner in withdrawing the exemption. The High Court's judgment focused on the procedural aspects of the Commissioner's decision, emphasizing the need for proper notice and opportunity for the respondent to contest the alleged violations.

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 702344 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 11-01-2013
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: HIGH COURT
• Department Lawyers: SANGRAM KULKARNI
• Assessee Lawyers: Y V RAVIRAJ
• Keywords: Exemption Certificate; Income Tax; Withdrawal of Exemption; Visvesvaraya Technological University
• Section: 260A; 80G(5); 10(23C)(iiiab)

Judgement Text

": 1 : IN THE HIGH COURT OF KARNATAKA CIRCUIT BENCH AT DHARWAD DATED THIS THE 11TH DAY OF JANUARY 2013 PRESENT THE HON’BLE MR.JUSTICE H.N.NAGAMOHAN DAS AND THE HON’BLE MR.JUSTICE V.SURI APPA RAO I.T.A. NO.5003/2012 BETWEEN: The Commissioner of Income Tax, Belgaum. …APPELLANT (By Sri.Y.V.Raviraj, Adv.,) AND: M/s. Visvesvaraya Technological University, Jnana Sangam Compux, Belgaum-590014. ...RESPONDENT (By Sri.Sangram S. Kulkarni, Adv.,) This appeal is filed under Section 260A of the Income Tax Act., 1961 against order passed in ITA No.128/PNJ/2011 dated 26.08.2011 on the file of the Income Tax Appellate Tribunal, Panaji Bench, Panaji, allowing the appeal filed by an assessee etc., : 2 : This appeal is coming on for final hearing this day H.N.Nagamohan Das J., delivered the following: JUDGMENT The Income Tax Department is before this Court in this appeal filed under Section 260A of the Income Tax Act, 1961 (for short the Act). Though this Court vide order dated 20.03.2012 admitted the appeal to consider three questions of law. We are of the opinion that following questions of law is sufficient to consider this appeal and the same is as under: 1. Whether on facts and in law, ITAT is right in holding that the CIT cannot withdraw recognition under Section 80G(5) of the Act on the basis of wrong application submitted by the assessee for renewal of recognition when the facts stated in the order itself prove that the assess university is not eligible for exemption under Section 10(23C)(iiiab) of the Income Tax Act, 1961? : 3 : 2. The respondent is a university established under Visvesvaraya Technological University Act, 1994. The respondent submitted an application for renewal of the exemption certificate issued under Section 80(G) of the Income Tax Act. The respondent made this renewal application under a bonafide impression that the exemption certificate requires renewal. The Commissioner noticed that Section 80(G) came to be amended to the effect that exemption granted prior to 01.10.2009 need not require renewal. The Commissioner while rejecting the application for renewal had withdrawn the exemption granted under Section 80(G) of the Act on the ground that there is violation of conditions specified in exemption certificate. Aggrieved by this order of the Commissioner, the respondent filed an appeal before the Tribunal and under the impugned order, the Tribunal set aside the order of Commissioner. Therefore, Revenue is before this Court. : 4 : 3. We heard arguments on both the side and perused the entire appeal papers. 4. A perusal of the impugned order passed by the Commissioner specifies that what was pending consideration before him was the application filed by the respondent for renewal of exemption certificate. Without issuing a notice specifying what are the conditions violated by the respondent and without providing an opportunity the impugned order came to be passed withdrawing the exemption granted under Section 80(G) of the Act. It is open for the Commissioner to initiate separate proceedings, issue necessary notice, provide opportunity and then pass appropriate orders in accordance with law relating to withdrawal of exemption certificate. Without following this procedure, the Commissioner committed a mistake in passing the order of withdrawal. Therefore, in the facts and circumstances of this case, the Tribunal has rightly reversed the findings of the Commissioner. The impugned order passed by the Tribunal : 5 : is in accordance with law. Accordingly, we answer the question of law framed above against the revenue and in favour of the assessee. Accordingly, the appeal is hereby disposed of. SD/- JUDGE SD/- JUDGE Bs "