The Commissioner of Income-tax, Salem v. M/s. Indian Educational Trust
[Citation -2015-LL-0128-17]

Citation 2015-LL-0128-17
Appellant Name The Commissioner of Income-tax, Salem
Respondent Name M/s. Indian Educational Trust
Court HIGH COURT OF MADRAS
Relevant Act Income-tax
Date of Order 28/01/2015
Judgment View Judgment
Keyword Tags principles of natural justice • trust deed • bona fide belief
Bot Summary: Respondent in both the appeals Appeals filed under Section 260-A of the Income Tax Act against the order dated 4.8.2011 passed by the Income Tax Appellate Tribunal, Madras 'C' Bench, Chennai, made in ITA Nos.1177 1178/Mds/2009. These appeals are a consequence of the order passed by the Commissioner of Income Tax, Salem, dated 23.11.07 and 29.5.09, whereby the respondent/assessee's application for registration under Section 12AA was denied and exemption sought for under Section 80G was also rejected. The brief facts, shorn of unnecessary details, are that the assessee filed application in Form 10A on 7.11.08 under Section 12AA(1)(aa) of the Income Tax Act for registration and also filed application for exemption under Section 80G(5)(vi) of the Income Tax Act. Hearing notices were issued by the Department on several dates and since none appeared on behalf of the Trust, the registration under Section 12AA was dismissed for default and exemption under Section 80G(5)(vi) was also rejected. Though the assessee contended that they were under the bona fide belief that the registration sought for under Section 12AA originally dated 14.8.02 was not rejected and presumed the same has been granted notwithstanding the subsequent rejection on 23.11.07 the said contention was not accepted by the Commissioner due to the fact that two subsequent applications for registration were filed by the assessee. Aggrieved against the said order of the Tribunal, the Revenue is before this Court by filing the present appeals. In such view of the matter, the Tribunal, on going through the documents and typed set of papers, was of the view that the case requires reconsideration of the entire issues by the Commissioner of Income Tax and, accordingly, remanded the matter back for reconsideration.


1 IN HIGH COURT OF JUDICATURE AT MADRAS DATE : 28.01.2015 CORAM HONOURABLE MR. JUSTICE R.SUDHAKAR AND HONOURABLE MR. JUSTICE R.KARUPPIAH T.C.A. NOS. 1071 & 1072 OF 2014 Commissioner of Income Tax Salem. Appellant in both appeals - Vs - M/s.Indian Educational Trust Gopinathapuram Cross Road Parayampatty Pudur Harur, Dharmapuri District. Respondent in both appeals Appeals filed under Section 260-A of Income Tax Act against order dated 4.8.2011 passed by Income Tax Appellate Tribunal, Madras 'C' Bench, Chennai, made in ITA Nos.1177 & 1178/Mds/2009. For Appellant : Mr.J.Narayanaswamy JUDGMENT (DELIVERED BY R.SUDHAKAR, J.) Aggrieved by order of Tribunal in allowing appeal filed by assessee/respondent herein, Revenue is before this Court by filing present appeal by raising following questions of law for consideration:- 2 a) Whether on facts and circumstances of case was Tribunal right in remanding issue back to CIT especially when document available on record and that accounts of assessee had not been properly maintained and returns of income filed were belated and when wrong claims have been made by assessee? b) Whether on facts and circumstances of case was Tribunal right in not considering fact that under Section 12AA Commissioner is empowered to reject application after perusing documents produced before him which he did? c) Whether on facts and circumstances of case was Tribunal right in remanding issue back to CIT, when application under Section 12AA dated 7.11.08 was properly rejected as per law since applicant had failed to provide documentary evidences sought for? 2. These appeals are consequence of order passed by Commissioner of Income Tax, Salem, dated 23.11.07 and 29.5.09, whereby respondent/assessee's application for registration under Section 12AA was denied and exemption sought for under Section 80G was also rejected. 3. brief facts, shorn of unnecessary details, are that assessee filed application in Form 10A on 7.11.08 under Section 12AA(1)(aa) of Income Tax Act for registration and also filed application for exemption under Section 80G(5)(vi) of Income Tax Act. Along with Form 10A, 3 certified copy of trust deed and deed of amendment were also filed. Initially Trust had applied for registration and exemption, which was rejected by Commissioner. Thereafter, Trust, once again on 7.11.08, applied for registration and exemption. Hearing notices were issued by Department on several dates and since none appeared on behalf of Trust, registration under Section 12AA was dismissed for default and, consequently, exemption under Section 80G(5)(vi) was also rejected. Though assessee contended that they were under bona fide belief that registration sought for under Section 12AA originally dated 14.8.02 was not rejected and, therefore, presumed same has been granted notwithstanding subsequent rejection on 23.11.07, however, said contention was not accepted by Commissioner due to fact that two subsequent applications for registration were filed by assessee. 4. Aggrieved by said orders of Commissioner of Income Tax, assessee filed appeals before Tribunal. Tribunal, on consideration of matter and on perusal of documentary evidences produced before it, remanded matter back to Commissioner of Income Tax for fresh consideration. Aggrieved against said order of Tribunal, Revenue is before this Court by filing present appeals. 4 5. Heard Mr. Narayanaswamy, learned standing counsel appearing for appellant/Department. 6. It is evident from records that main plea taken by assessee/respondent herein before Tribunal appears to be on violation of principles of natural justice stating that documents and evidence produced by assessee/respondent have not been considered by authority. In such view of matter, Tribunal, on going through documents and typed set of papers, was of view that case requires reconsideration of entire issues by Commissioner of Income Tax and, accordingly, remanded matter back for reconsideration. For better clarity, para-4 of order of Tribunal, is extracted hereinbelow :- We have visualized rival stands and have also carefully treaded through Trust Deed and other relevant documents enclosed in paper book. We are convinced that this is fit case for remanding back to file of ld. CIT so that he can re-examine entire issue(s) in light of evidence(s) available before him as well as oral submissions, if any, which can be made. Consequently, we restore both these appeals to file of ld. CIT for his fresh decision. Consequently, both appeals are allowed for statistical purposes. 7. It is clear from order passed by Tribunal that it is open 5 remand without any fetters on department and, therefore, no grievance can be addressed in this appeal. questions of law raised by appellant, in facts of present case, are not required to be adjudicated upon. 8. In result, appeal fails and same is dismissed. (R.S.J.) (R.K.J.) 28.01.2015 Index : Yes / No Internet : Yes / No GLN To 1. Commissioner of Income Tax Salem. 2. Income Tax Appellate Tribunal 'C' Bench, Chennai. 6 R.SUDHAKAR, J. AND R.KARUPPIAH, J. GLN T.C.A. NOS.1071 & 1072 OF 2014 28.01.2015 Commissioner of Income-tax, Salem v. M/s. Indian Educational Trust
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