M/s.Film Distributors Association, Cochin v. The ACIT (Exemption), Cochin

ITA 394/COCH/2015 | 2011-2012
Pronouncement Date: 18-10-2016

Appeal Details

RSA Number 39421914 RSA 2015
Assessee PAN AAAAF1042L
Bench Cochin
Appeal Number ITA 394/COCH/2015
Duration Of Justice 1 year(s) 3 month(s) 12 day(s)
Appellant M/s.Film Distributors Association, Cochin
Respondent The ACIT (Exemption), Cochin
Appeal Type Income Tax Appeal
Pronouncement Date 18-10-2016
Appeal Filed By Assessee
Bench Allotted DB
Tribunal Order Date 18-10-2016
Date Of Final Hearing 18-10-2016
Next Hearing Date 18-10-2016
Assessment Year 2011-2012
Appeal Filed On 06-07-2015
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH COCHIN BEFORE SHRI GEORGE GEORGE K. JUDICIAL MEMBER I.T.A. NO. 393 - 395 /COCH/201 5 ASSESSMENT YEAR S : 20 10 - 11 - 2012 - 13 M/S. FILM DISTR IBUTORS ASSOCIATION DOOR NO. CC 41/1604A SOPANAM SQUARE ARANGATH CROSS ROAD KOCHI-682 018. [PAN:AAAAF 1042L] VS. THE ASSISTANT COMMISSIONER OF INCOME-TAX (EXEMPTION) RANGE-4 KOCHI. (ASSESSEE - APPELLANT) (REVENUE - RESPONDENT) ASSESSEE BY MS. MEGHANA M. BENNY A DV. REVENUE BY SHRI A. DHANARAJ SR.DR DATE OF HEARING 1 8 /10 / 201 6 DATE OF PRONOUNCEMENT 1 8 TH /10/ 201 6 O R D E R PER GEORGE GEORGE K. JUDICIAL MEMBER THESE THREE APPEALS AT THE INSTANCE OF THE ASSES SEE ARE DIRECTED AGAINST THREE SEPARATE ORDERS OF THE CIT(A)-III KOCHI ALL DATED 31/03/2015. THE RELEVANT ASSESSMENT YEARS ARE 2010-11 TO 2012-13. 2. BRIEFLY STATED THE FACTS OF THE CASE ARE AS FO LLOWS: THE ASSESSEE IS AN ASSOCIATION OF FILM DISTRIB UTORS. IT FILED ITS RETURN OF INCOME FOR THE ASSESSMENT YEAR 2010-11 CLAIMING THE STATUS OF A CHARITABLE TRUST. IN THE RETURN FILED THE ASSESSEE HAD RETURNED THE TOTAL I NCOME OF RS.8 88 190/- AND I.T.A. NOS.393-395/COCH/2015 2 CLAIMED EXEMPTION U/S. 11 TO THE TUNE OF RS.11 59 0 59/-. THE RETURN WAS PROCESSED AND INTIMATION U/S. 143(1) OF THE ACT WAS ISSUED. THE ASSESSING OFFICER DID NOT ACCEPT THE STATUS OF A CHARITABLE TRUST AS CLAIMED BY THE ASSESSEE BECAUSE THE REGISTRATION U/S. 12A OF THE ACT WAS NOT GRANTE D TO THE ASSESSEE FOR THE ASSESSMENT YEAR 2010-11. WHILE PROCESSING THE RETU RN U/S. 143(1) THE ASSESSING OFFICER DID NOT ALLOW THE EXEMPT CLAIMED U/S. 11 AN D THE RETURNED INCOME OF RS.8 88 190/- WAS BROUGHT TO TAX. 2.1 SIMILARLY FOR THE ASSESSMENT YEAR 2011-12 THE RETURN WAS FILED BY THE ASSESSEE CLAIMING THE STATUS OF A CHARITABLE TRUST. THE TOTAL INCOME RETURNED WAS RS.16 64 280/- AND EXEMPT CLAIMED U/S. 11 WAS FOR T HE ENTIRE INCOME. THE ASSESSING OFFICER PROCESSED THE RETURN AND INTIMATI ON U/S. 143(1) WAS ISSUED WHEREIN THE EXEMPT CLAIMED U/S. 11 WAS DENIED AND T HE RETURNED INCOME OF RS.16 64 280/- WAS BROUGHT TO TAX. THE REASONING OF THE ASSESSING OFFICER TO DENY THE BENEFIT OF DEDUCTION U/S. 11 OF THE ACT WAS THA T ASSESSEE WAS NOT REGISTERED U/S. 12A OF THE ACT FOR THE AY 2011-12. 2.2 FOR THE ASSESSMENT YEAR 2012-13 THE RETURN WAS FILED BY THE ASSESSEE CLAIMING IT TO BE A CHARITABLE TRUST. THE TOTAL IN COME RETURNED WAS RS.11 43 000/- AND THE ENTIRE INCOME WAS CLAIMED AS EXEMPT U/S. 11 OF THE ACT. THE ASSESSING OFFICER WHILE PROCESSING THE INTIMATION U/S. 143(1) OF THE ACT HELD THAT THE ASSESSEE WAS NOT GRANTED REGISTRATION U/S. 12A OF T HE ACT FOR THE RELEVANT I.T.A. NOS.393-395/COCH/2015 3 ASSESSMENT YEAR AND THEREFORE THE CLAIM OF EXEMPTI ON U/S. 11 WAS DENIED AND THE RETURNED INCOME OF RS.11 43 000/- WAS BROUGHT T O TAX. 3. AGGRIEVED BY THE ASSESSMENTS COMPLETED FOR THE ASSESSMENT YEARS 2010-11 TO 2012-13 THE ASSESSEE PREFERRED THE APPEALS TO THE FIRST APPELLATE AUTHORITY. THE FIRST APPELLATE AUTHORITY PASSED THREE SEPARATE ORD ERS ALL DATED 31/03/2015. THE CIT(A) HELD THAT THE ASSESSEE FOR THE RELEVANT ASSE SSMENT YEARS WAS NOT GRANTED REGISTRATION U/S. 12A OF THE ACT AND HENCE THE INT IMATION ISSUED BY REJECTING THE CLAIM OF DEDUCTION U/S. 11 OF THE ACT IS LEGALLY CO RRECT. THE RELEVANT FINDING OF THE CIT(A) FOR THE ASSESSMENT YEAR 2010-11 READS AS FOL LOWS: 6.3 I HAVE CONSIDERED THE FACTS AVAILABLE ON RECOR D AS WELL AS THE SUBMISSIONS MADE BY THE APPELLANT. THE FACT IS THAT THE APPELL ANT WAS NOT GRANTED REGISTRATION U/S. 12A FOR THE AY 2010-11. HOWEVER THE REGISTRATION WAS GRANTED BY THE COMMISSIONER OF INCOME-TAX(APPEALS) KOCHI F ROM THE AY 2013-14 ONWARDS. IN THE ABOVE CIRCUMSTANCES AND WHEN THERE IS A SPECIFIC ORDER FROM THE COMMISSIONER OF INCOME-TAX GRANTING REGISTRATION FR OM AY 2013-14 DEEMED REGISTRATION FOR THE AY 2010-11 CAN NOT BE GRANTED. THEREFORE THE CLAIM OF THE APPELLANT IS NOT ACCEPTED. 4. AGGRIEVED BY THE ORDERS PASSED BY THE FIRST APP ELLATE AUTHORITY THE ASSESSEE HAS PREFERRED THE PRESENT APPEALS BEFORE THE TRIBUN AL. THE GROUNDS RAISED IN THE APPEAL MEMORANDUM FOR ALL THE ASSESSMENT YEARS ARE IDENTICAL AND THEY READ AS FOLLOWS: A. THE ORDER OF CIT(APPEALS)-III TO THE EXTENT OBJE CTED TO HEREUNDER IS ABSOLUTELY ILLEGAL ARBITRARY AND UNAUTHORIZED. I.T.A. NOS.393-395/COCH/2015 4 B. THE APPELLANT FILED THE ORIGINAL APPLICATION FOR REGISTRATION U/S. 12AA ON 19.07.2006. DUE TO A MISTAKE IN THE OFFICE OF THE REGISTERING AUTHORITY THE APPELLANT WAS REQUIRED TO FURNISH AGAIN COPIES OF D OCUMENTS RELATING TO THE REQUEST MADE IN JULY 2006. THIS WAS SUBMITTED DURI NG AUGUST 2008. CONSIDERING THE INORDINATE DELAY THE APPELLANT AGAI N APPROACHED THE COMMISSIONER OF INCOME-TAX AND WAS ADVISED TO FILE AGAIN COPIES OF REQUEST ALREADY SUBMITTED. THIS WAS FURTHER SUBMITTED ON 0 1/08/2011. THEREFORE SINCE FROM 19/07/2006 THE REQUEST APPLICATION FOR REGISTR ATION U/S. 12AA OF THE IT ACT KEPT IDLE OR UNNOTICED DUE TO THE REASON BEST KNOWN TO THE REGISTERED AUTHORITY. FINALLY THE AUTHORITY CONCERNED GRANTED PERMISSION W.E.F. ASSESSMENT YEAR 2013-14. IT IS RESPECTFULLY SUBMIT TED THAT THE APPELLANT CANNOT BE HELD RESPONSIBLE FOR THE LAXITY (IF SO) O CCURRED IN PROCESSING THE REQUEST APPLICATION MADE U/S. 12AA DATED 19/07/2006 . HENCE THE REGISTRATION IS DEEMED TO HAVE BEEN GRANTED FROM DECEMBER 2006 I TSELF. C. MORE OVER PROVISO 2 OF SECTION 12AA OF IT ACT ST ATES EVERY ORDER GRANTING OR REFUSING REGISTRATION UNDER CLAUSE (B) OF SUB-SE CTION (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) (OR CLAUS E (AA) OF SUB-SECTION(1) OF SECTION 12A].. HENCE THE TIME FRAME PROVIDED U/S. 12AA(2) IS MANDATORY IN NATURE. THEREFORE THE REGISTRATION IS DEEMED TO HA VE BEEN GRANTED FROM DECEMBER 2006 ONWARDS. D. THE APPELLATE AUTHORITY ERRED IN CONFIRMING THE ORDER TREATING THE STATUS OF THE APPELLANT AS AOP INSTEAD OF TRUST AS CLAIMED IN INCOME TAX RETURN. E. IN CIT VS. MAZAFAR NAGAR DEVELOPMENT AUTHORITY R EPORTED IN 2015 (3) TMI 99-ALLAHABAD HIGH COURT (LB) IT WAS HELD THAT AS R ELYING SHEELA CHRISTIAN CHARITABLE CASE 2013 (3) TMI 268 MADRAS HIGH COUR T WHERE IN HELD THAT THE TRIBUNAL WAS NOT RIGHT IN HOLDING THAT THE FAILURE TO PASS AN ORDER IN APPLICATION U/S. 12AA WITHIN THE STIPULATED TIME OF 6 MONTHS WO ULD AUTOMATICALLY RESULT IN GRANTING REGISTRATION TO TRUST. HENCE THE ORDER OF CIT(APPEAL)-III IS ARBITRARY AND ILLEGAL. F. THE APPELLATE AUTHORITY FAILED TO CONSIDER THE F ACTS THAT THE ASSESSEE HAS DULY SUBMITTED AN APPLICATION ORIGINALLY IN THE YEA R 2006 AND AGAIN THE COPIES OF SAME WERE SUBMITTED IN THE YEAR 2008 AND 2011. THE REASON FOR DELAY IN PROCESSING THE APPLICATION IS BEST KNOWN TO THE DEP ARTMENT. ALL THE FACTS WERE APPRAISED TO THE CIT(APPEALS)-III WHICH WAS NOT CO NSIDERED ON MERITS AT THE TIME OF DISPOSING THE APPEAL. G. IT IS SUBMITTED THAT VIDE CIRCULAR NO. 1/2015 D ATED 21 ST JANUARY C.F. NO.142/13/2014-TPL 2015 ISSUED BY CBDT WHICH SAYS T HAT WHEN A REGISTRATION IS GRANTED U/S. 12AA AFTER THE AMENDMENT OF FINANCE ACT 2007 THE BENEFIT OF I.T.A. NOS.393-395/COCH/2015 5 SECTION 11 AND 12 OF THE ACT SHALL BE AVAILABLE IN RESPECT OF ANY INCOME DERIVED IN ANY ASSESSMENT PROCEEDINGS IN AN EARLIER ASSESSM ENT YEAR WHICH IS PENDING BEFORE THE ASSESSING OFFICER AS ON THE DATE OF SUCH REGISTRATION. HENCE THE ORDER OF ASSESSING AUTHORITY IS ILLEGAL AND ARBITRA RY. FOR THESE AND OTHER GROUNDS TO BE SUBMITTED AT THE TIME OF HEARING IT IS HUMBLY PRAYED THAT THE TRIBUNAL BE PLEASED TO ALLOW THE APPEAL. 5. THE LD. COUNSEL FOR THE ASSESSEE RELIED ON THE GROUNDS RAISED IN THE APPEAL MEMORANDUM. THE LD. DR PRESENT WAS DULY HEARD. 6. I HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. ADMITTEDLY IN THIS CASE THE REGISTRATION U/S. 12A OF THE ACT WAS GRANTED TO THE ASSESSEE ONLY FROM THE ASSESSMENT YEAR 2013-14 ONWA RDS. FOR THE RELEVANT ASSESSMENT YEARS NAMELY 2010-11 TO 2012-13 THE B ENEFIT OF REGISTRATION U/S. 12A OF THE ACT WAS NOT AVAILABLE TO THE ASSESSEE. THE ASSESSING OFFICER WHILE PROCESSING THE RETURN FOR THE ASSESSMENT YEARS 2010 -11 TO 2012-13 HAS CORRECTLY DENIED THE EXEMPTION CLAIMED U/S. 11 OF THE ACT AND HAS BROUGHT TO TAX THE RETURNED INCOME WHICH WAS CONFIRMED BY THE FIRST AP PELLATE AUTHORITY. THE GROUNDS RAISED IN THE APPEAL MEMORANDUM IS TO THE E FFECT THAT THE REGISTRATION OUGHT TO HAVE BEEN GRANTED TO THE ASSESSEE FOR THE RELEVANT ASSESSMENT YEARS ALSO SINCE THE APPLICATION FOR REGISTRATION WAS FI LED IN JULY 2006. THE ASSESSEE OUGHT TO HAVE CHALLENGED THE ORDER GRANTING REGISTR ATION WITH EFFECT FROM THE ASSESSMENT YEAR 2013-14 INSTEAD OF CHALLENGING THE ASSESSMENT ORDER. THE ASSESSEES PLEA OUGHT TO HAVE BEEN THAT SINCE THE A PPLICATION WAS SUBMITTED U/S. I.T.A. NOS.393-395/COCH/2015 6 12A OF THE ACT ON 19/07/2006 IT IS ENTITLED FOR DE EMED REGISTRATION ON THE EXPIRY OF SIX MONTHS FROM THE DATE OF SUBMITTING THE APPLI CATION U/S. 12A OF THE ACT. THE CHALLENGE OUGHT TO HAVE BEEN AGAINST THE ORDER PASS ED U/S. 12A OF THE ACT INSTEAD OF THE ASSESSMENT ORDER. WITH THESE OBSERVATIONS I DISMISS THE APPEALS FILED BY THE ASSESSEE. IT IS ORDERED ACCORDINGLY. 7. IN THE RESULT THE APPEALS FILED BY THE ASSES SEE ARE DISMISSED. PRONOUNCED IN THE OPEN CO URT ON 18 TH -10-2016 SD/- (GEORGE GEORGE K.) JUDICIAL MEMBER PLACE: KOCHI DATED: 18 TH OCTOBER 2016 GJ COPY TO: 1. M/S. FILM DISTRIBUTORS ASSOCIATION DOOR NO. CC 41/1604A SOPANAM SQUARE ARANGATH CROSS ROAD KOCHI-682 018. 2. THE ASSISTANT COMMISSIONER OF INCOME-TAX(EXEMPTIO N) RANGE-4 KOCHI. 3. THE COMMISSIONER OF INCOME-TAX(APPEALS)-III KOC HI. 4. THE COMMISSIONER OF INCOME-TAX KOCHI. 5. D.R. I.T.A.T. COCHIN BENCH COCHIN. 6. GUARD FILE. BY ORDER (ASSISTANT REGISTRAR ) I.T.A.T. COCHIN