Jhansi Development Authority, Jhansi v. C.I.T.-2, Agra

ITA 467/AGR/2011 | misc
Pronouncement Date: 30-03-2012 | Result: Allowed

Appeal Details

RSA Number 46720314 RSA 2011
Assessee PAN AAALJ0068K
Bench Agra
Appeal Number ITA 467/AGR/2011
Duration Of Justice 3 month(s) 15 day(s)
Appellant Jhansi Development Authority, Jhansi
Respondent C.I.T.-2, Agra
Appeal Type Income Tax Appeal
Pronouncement Date 30-03-2012
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted DB
Tribunal Order Date 30-03-2012
Date Of Final Hearing 29-03-2012
Next Hearing Date 29-03-2012
Assessment Year misc
Appeal Filed On 15-12-2011
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL AGRA BENCH AGRA BEFORE SHRI BHAVNESH SAINI JUDICIAL MEMBER AND SHRI A.L. GEHLOT ACCOUNTANT MEMBER ITA NO.467/AGR/2011 JHANSI DEVELOPMENT AUTHORITY VS. COMMISSIONER OF INCOME-2 OPP. COMMISSIONERY CAMPUS AGRA. JHANSI. (PAN: AAALJ 0068 K) (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI R.K. AGARWAL ADVOCATE RESPONDENT BY : SHRI SOHAIL AKHTAR JR. D.R. DATE OF HEARING : 29.03.2012 DATE OF PRONOUNCEMENT : 30.03.2012 ORDER PER A.L. GEHLOT ACCOUNTANT MEMBER: THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER DATED 25.10.2011 PASSED BY THE LD. CIT-II AGRA. 2. THE EFFECTIVE GROUND RAISED IN THE APPEAL FILED BY THE ASSESSEE IS IN RESPECT OF WITHDRAWAL OF REGISTRATION UNDER SECTION 12AA OF THE INCOME TAX ACT 1961 (THE ACT HEREINAFTER). ITA NO.467/AGR/2011 2 3. THE BRIEF FACTS OF THE CASE ARE THAT REGISTRATIO N UNDER SECTION 12AA WAS GRANTED W.E.F. 01.04.2003. SUBSEQUENTLY A NOTICE F OR WITHDRAWAL OF REGISTRATION W.E.F. ASSESSMENT YEAR 2009-10 WAS ISSUED UNDER SEC TION 12AA(3) READ WITH SECTION 293C OF THE ACT. THE CIT ON THE BASIS OF T HE SAID NOTICE UNDER SECTION 12AA(3) READ WITH SECTION 293C OF THE ACT WITHDRAWN THE REGISTRATION W.E.F. ASSESSMENT YEAR 2009-10 ON THE GROUND THAT THE CASE OF THE ASSESSEE IS HIT BY PROVISO TO SECTION 2(15) INSERTED BY FINANCE ACT 2 008 AND THE ACTIVITIES OF THE ASSESSEE ARE NOT FOR CHARITABLE PURPOSE. 4. AT THE OUTSET THE LD. AUTHORISED REPRESENTATIVE OF THE ASSESSEE SUBMITTED THAT THE ISSUE IS COVERED BY THE ORDER OF I.T.A.T. AGRA BENCH IN THE CASE OF AGRA DEVELOPMENT AUTHORITY ITA NO.447/AGR/2011 ORDER DA TED 02.03.2012. THE LD. AUTHORISED REPRESENTATIVE SUBMITTED THAT THE FACTS OF THE CASE ARE IDENTICAL TO THE FACTS OF AGRA DEVELOPMENT AUTHORITY (SUPRA). 5. AFTER HEARING THE LD. REPRESENTATIVES OF THE PAR TIES AND PERUSING THE RECORDS WE FIND THAT THE FACTS OF THE CASE UNDER CONSIDERAT ION ARE IDENTICAL TO THAT OF AGRA DEVELOPMENT AUTHORITY (SUPRA) AS THE NOTICE WAS ISS UED UNDER SECTION 12AA(3) READ WITH SECTION 293C OF THE ACT. THE RELEVANT FA CTS AND FINDING OF THE I.T.A.T. IN THE CASE OF AGRA DEVELOPMENT AUTHORITY IN ITA NO.44 7/AGR/2011 ARE REPRODUCED AS UNDER :- ITA NO.467/AGR/2011 3 4. AT THE OUTSET THE LD. AUTHORISED REPRESENTATIV E OBJECTED TO THE ACTION OF THE CIT ON THE GROUND THAT SHOW CAUSE NOT ICE ISSUED BY THE CIT UNDER SECTION 293C OF THE ACT IS NOT IN ACCORDA NCE WITH LAW. THEREFORE THE ORDER OF CIT IS WITHOUT JURISDICTION . THE LD. AUTHORISED REPRESENTATIVE IN SUPPORT OF HIS CONTEN TION RELIED UPON THE ORDER OF I.T.A.T. MUMBAI BENCHES IN THE CASE O F BRAHMAN SABHA TRUST IN ITA NO.1944/MUM/2010 ORDER DATED 22.03.201 1. THE RELEVANT FINDING OF THE I.T.A.T. IS REPRODUCED AS U NDER :- 6. IT IS THE LEGALITY OF THE AFORESAID ORDER WHICH IS BEING CHALLENGED BEFORE US IN THIS APPEAL. ONE OF THE PRELIMINARY OBJECTIONS OF THE APPELLANT IS THAT THE RE IS NO PROVISION IN SECTION 12AA TO ENABLE THE CIT TO CANC EL THE REGISTRATION EARLIER GRANTED UNDER SECTION 12A OF T HE ACT. WE ARE OF THE VIEW THAT THE ABJECTION IS WELL FOUND ED. SECTION 12AA(3) PROVIDES THAT WHERE A TRUST OR AN INSTITUTION HAS BEEN GRANTED REGISTRATION UNDER CLA USE (B) OF SUB-SECTION (1) THEREOF AND SUBSEQUENTLY THE CIT IS SATISFIED THAT THE ACTIVITIES OF THE TRUST WERE NOT GENUINE O R THEY WERE BEING CARRIED OUT NOT IN ACCORDANCE WITH THE OBJECT S OF THE TRUST HE SHALL PASS AN ORDER IN WRITING CANCELLING THE REGISTRATION OF THE TRUST. SUB-SECTION (3) OF SECT ION 12AA WAS INSERTED BY THE FINANCE (NO.2) ACT 2004 WITH EFFECT FROM 01.10.2004. THIS SUB-SECTION AS IT WAS ORIGI NALLY INSERTED IS NOT APPLICABLE TO THE PRESENT CASE BEC AUSE HEREIN THE ASSESSEE-TRUST WAS NOT GRANTED REGISTRAT ION UNDER CLAUSE (B) OF SUB-SECTION (1) OF SECTION 12AA OF TH E ACT. IT WAS GRANTED REGISTRATION UNDER SECTION 12A(A) OF TH E ACT BY ORDER DATED 22.02.2002. IT WAS HOWEVER POINTED OUT ON BEHALF OF THE INCOME-TAX DEPARTMENT THAT THE FINANC E ACT 2010 HAS INTRODUCED AN AMENDMENT TO SECTION 12AA(3 ) TO THE EFFECT THAT THE CIT CAN CANCEL REGISTRATION OBT AINED BY THE ASSESSEE AT ANY TIME UNDER SECTION 12A AS IT S TOOD BEFORE BEING AMENDED BY THE FINANCE (NO.2) ACT 199 6. IT IS ACCORDINGLY CONTENDED THAT THE CIT CAN EVEN CANC EL REGISTRATION GRANTED TO THE TRUST UNDER SECTION 12A OF THE ACT. WE HOWEVER FIND THAT THIS AMENDMENT WAS MADE BY THE FINANCE ACT 2010 WITH EFFECT FROM 01.06.2010 WHI CH MEANS THAT AN ORDER CANCELLING REGISTRATION GRANTED UNDER SECTION 12A CAN BE PASSED BY THE CIT UNDER SECTION ITA NO.467/AGR/2011 4 12AA(3) ONLY ON AND FROM 01.06.2010. THE PRESENT O RDER HAS BEEN PASSED BY THE CIT ON 11.01.2010 AND THEREF ORE CANNOT BE SUSTAINED. 7. THE LEARNED CIT DR DREW OUR ATTENTION TO SECTION 293C OF THE ACT. IN FACT EVEN THE CIT HAS RELIED O N THIS PROVISION IN THE LAST PARAGRAPH OF THE IMPUGNED ORD ER. THIS SECTION IS TITLED POWER TO WITHDRAW APPROVAL. IT WAS INTRODUCED BY THE FINANCE (NO.2) ACT 2009 WITH EF FECT FROM 01.10.2009. CIRCULAR NO.5 OF 2010 ISSUED BY T HE CBDT ON 03.06.2010 (2010) 324 ITR (STATUTES) 293 EXPLAINS THE PROVISIONS OF THE SAID FINANCE ACT. P ARAGRAPH 57 EXPLAINS THE PROVISIONS OF SECTION 293C AND THE SAME IS AS UNDER :- 57. POWER TO WITHDRAW APPROVALS 57.1 UNDER THE EXISTING PROVISIONS OF INCOME-TAX ACT AN APPROVAL IS REQUIRED TO BE GRANTED BY INCOME-TAX AUTHORITY FOR AVAILING OF VARIOUS INCENTIVES BY THE ASSESSEES. WHILE SOME PROVISIONS OF INCOME-TAX ACT SPECIFICALLY CONTAIN PROVISIONS F OR WITHDRAWAL OF APPROVAL BUT IN MANY CASES THERE IS NO SUCH SPECIFIC PROVISIONS CONTAINING POWER OF WITHDRAWAL. 57.2 IN ORDER TO PROVIDE SUCH EXPLICIT PROVISIONS FOR POWER TO WITHDRAW APPROVAL A NEW SECTION 293C HAS BEEN INSERTED TO PROVIDE THAT THE CENTRAL GOVERNMENT OR THE BOARD OR AN INCOME-TAX AUTHORITY WHO HAS AUTHORITY TO GRANT APPROVAL SHALL ALSO HAVE THE POWER TO WITHDRAW THE APPROVAL AT ANY TIME. HOWEVER SUCH WITHDRAWAL CAN BE MADE ONLY AFTER GIVING A REASONABLE OPPORTUNITY OF SHOWING CAUSE AGAINST THE PROPOSED WITHDRAWAL TO THE CONCERNED ASSESSEE. 57.3 APPLICABILITY THIS AMENDMENT HAS BEEN MADE APPLICABLE WITH EFFECT FROM 1 ST OCTOBER 2009 AND WILL ACCORDINGLY APPLY IN RELATION TO ASSESSMEN T YEAR 2010-11 AND SUBSEQUENT ASSESSMENT YEARS. ITA NO.467/AGR/2011 5 THERE IS A DISTINCTION BETWEEN AN APPROVAL AND REGISTRATION. THE ACT ITSELF USES BOTH THE EXPRE SSIONS. SECTION 12A SPEAKS OF REGISTRATION. THERE ARE OT HER SECTIONS IN THE ACT WHICH SPEAKS OF APPROVAL. FO R EXAMPLE SECTION 80G(5)(VI) SPEAKS OF THE INSTITUTI ON OR FUND BEING APPROVED BY THE COMMISSIONER. AGAIN SECTION 35(2) SPEAKS OF ANY SURVEY OR ENGINEERING SERVICES CARRIE D OUT BY THE ASSESSEE HIMSELF OR BY A CONCERN WHICH IS FOR T HE TIME BEING APPROVED IN THIS BEHALF BY THE BOARD. SECTIO N 35CCB(2) SPEAKS OF THE DEDUCTION UNDER THAT SECTION BEING ALLOWED SUBJECT TO THE CONDITION THAT THE PAYMENT O F THE AMOUNT BY THE ASSESSEE SHALL BE TO AN ASSOCIATION O R INSTITUTION WHICH IS FOR THE TIME BEING APPROVED IN THIS BEHALF BY THE PRESCRIBED AUTHORITY. SECTION 35CCA( 2A) ALSO REFERS TO AN APPROVAL GRANTED TO THE ASSOCIATI ON OR INSTITUTION TO WHOM THE ASSESSEE HAS PAID THE AMOUN T IN RESPECT OF WHICH A CLAIM FOR DEDUCTION IS MADE UNDE R THE SECTION. IT IS NOT NECESSARY TO MULTIPLY INSTANCES . SECTION 293C USES THE EXPRESSION APPROVAL. IT CANNOT THE REFORE APPLY TO A CASE OF REGISTRATION. THEREFORE THE SE CTION CANNOT INFUSE VALIDITY TO THE IMPUGNED ORDER. 8. FOR THE ABOVE REASONS WE UPHOLD THE PRELIMINARY OBJECTION RAISED BY THE ASSESSEE AND ANNUL THE IMPU GNED ORDER WHICH HAS BEEN PASSED WITHOUT JURISDICTION. THE APPEAL OF THE ASSESSEE IS ALLOWED WITH NO ORDER AS TO COSTS. 5. THE LD. AUTHORISED REPRESENTATIVE DREW OUR ATTEN TION ON THE SHOW-CAUSE NOTICE OF WHICH COPY HAS BEEN PLACED AT PAGE NOS.5 TO 10 OF THE ASSESSEES PAPER BOOK AND SUBMITTED THAT THE CIT ISSUED SHOW CAUSE NOTICE UNDER SECTION 293C OF THE ACT. THUS THE CIT ISSUED SHOW-CAUSE NOTICE UNDER SECTION 293C OF THE ACT. O N IDENTICAL SET OF FACTS THE I.T.A.T. MUMBAI BENCHES IN THE CASE OF BRAHMAN SABHA TRUST (SUPRA) HAS HELD THAT THE ORDER OF CIT IS WIT HOUT JURISDICTION. WE RESPECTFULLY FOLLOW THE ABOVE ORDER OF I.T.A.T. MUMBAI BENCHES. IN THE LIGHT OF THE FACTS WE UPHOLD THE PRELIMINAR Y OBJECTION RAISED BY THE LD. AUTHORISED REPRESENTATIVE AND ANNUL THE IMP UGNED ORDER WHICH IS PASSED WITHOUT JURISDICTION. SINCE THE IS SUE IS DECIDED IN FAVOUR OF THE ASSESSEE ON PRELIMINARY OBJECTION TH EREFORE WE ARE NOT EXPRESSING ANY OPINION IN RESPECT OF MERIT AND OTHE R ASPECTS OF THE ITA NO.467/AGR/2011 6 MATTER. HOWEVER THE CIT IS AT LIBERTY TO TAKE ACT ION IN ACCORDANCE WITH LAW IF SUGGESTED SO. 6. SINCE THE FACTS ARE IDENTICAL AND TO MAINTAIN C ONSISTENCY WE FOLLOW THE ABOVE ORDER OF I.T.A.T. IN ITA NO.447/AGR/2011 IN T HE CASE OF AGRA DEVELOPMENT AUTHORITY AND THE ISSUE IS DECIDED ACCORDINGLY WITH IDENTICAL DIRECTIONS. 7. IN THE RESULT APPEAL FILED BY THE ASSESSEE IS A LLOWED AS ABOVE. (ORDER PRONOUNCED IN THE OPEN COURT ON 30.03.2012) SD/- SD/- (BHAVNESH SAINI) (A.L. GEHLOT) JUDICIAL MEMBER ACCOUNTANT MEMBER DATE: 30 TH MARCH 2012 PBN/* COPY OF THE ORDER FORWARDED TO: APPELLANT RESPONDENT CIT CONCERNED CIT (APPEALS) CONCERNED D.R. ITAT AGRA BENCH AGRA GUARD FILE. BY ORDER ASSISTANT REGISTRAR INCOME-TAX APPELLATE TRIBUNAL AGRA TRUE COPY