Asha Jain Educational Society, ... vs Assessee

Asha Jain Educational Society, vs. CIT, Asha Modern Public School, Muzaffarnagar. Ahmad Bagh, Behind Petrol Pump, Court Road, Saharanpur - 247 001.

(PAN : AABTA7912J)

(APPELLANT) (RESPONDENT)

ASSESSEE BY : Shri K. Sampath, Advocate REVENUE BY : Smt. Anuradha Mishra, CIT DR

Date of Hearing : 10.06.2015 Date of Pronouncement : 12.06.2015

ORDER

PER GEORGE GEORGE K. :

This appeal, at the instance of the assessee, is directed against the order of

the Commissioner of Income-tax, Muzaffarnagar dated 26.11.2013.

2. The assessee is running a school under the name and style of Asha

Modern Public School, Court Road, Saharanpur. The society is registered with

the Registrar of Societies. The society is not carrying out any activity other than

education as its object.

3. The assessee filed an application in Form No.10A for registration u/s 12A

of the Income-tax Act, 1961. The assessee's application for registration as per 2 ITA No.479/Del./2014

the provisions of Section 12A was rejected by the Commissioner of Income-tax,

Saharanpur by holding as under :-

" During the course of 12A proceedings, the assessee was required to file lease deed for land and building and also to furnish whether expansion / construction / renovation and other work done by the Society and to state whether it is in the form of diversion of profit to interested persons / parties and what is the Society's explanation for the same.

In response the assessee furnished lease deed for the land and building of the school. It has been stated that the President of the Society has leased his property to the Society which was already fully constructed out of his own funds and the Society had to invest about Rs.700000/- over the years on the building to make it fit and appropriate for school purposes like expenses have been incurred on labs and store rooms. It has been further stated that considering the overall market value and marketable lease value of the property which runs into several crores, the aforesaid amount is only meager and cannot be called any diversion or benefit or profits to the promoters. The assessee has also stated that the meager addition to the building was made by the Society for its own purposes to carry out its activities more appropriately rather than to benefit tile lessor and the Society has given only nominal amount of rent as compared to the market value to the land lord.

From the above, it is clear that the land and building is owned by the office bearers of the Society. The Society is a lease holder of the land and the lease is only for 11 months and when the rent agreement comes to an end, obviously the institution on the same cannot run by the Society and the benefit would pass to the owner / occupant. Hence, the argument of the ld. Counsel does not survive. Further, the Society has changed its name from Asha Jain Educational Society to Asha Jain Alpasankhyak Society with the Registrar of Society whereas the application for registration u/s 12AA has been applied in the old name i.e. Asha Jain Educational Society.

In view of the above discussion, the assessee Society is not entitled to get the registration u/s 12AA of the I.T. Act, 1961. Accordingly, the application of the assessee Society is hereby rejected."

3 ITA No.479/Del./2014 3. We have heard the rival submissions and perused the material available

on record. We find from the paper book submitted by the assessee that assessee

society is only running a school and also not carrying any activity other than

education. The CIT has not dealt with the submissions made by the assessee.

We also find that the CIT (A)'s order is brief, cryptic and non-speaking. In view

of the above, we are of the opinion that in the interest of justice and equity, the

matter be restored to the file of the CIT to decide afresh after providing an

opportunity of being heard to the assessee. It is ordered accordingly.

4. In the result, the appeal of the assessee is allowed for statistical purposes.

Order pronounced in open court on this 12th day of June, 2015.

Sd/- sd/- (N.K. SAINI) (GEORGE GEORGE K) ACCOUNTANT MEMBER JUDICIAL MEMBER

Dated the 12th day of June, 2015 TS

Copy forwarded to: 1.Appellant 2.Respondent 3.CIT 4.CIT, Muzaffarnagar. 5.CIT(ITAT), New Delhi. AR, ITAT NEW DELHI.