Sh. Guru Hargobind Sahib Charitable ... vs Assessee

Sh.Guru Hargobind Sahib Charitable Trust, Vs. The C.I.T-III, Opposite Ludhiana Hospital, Ludhiana. Village Kothe Bhaggu, Jagaron. PAN: AACTS9358K (Appellant) (Respondent)

Appellant by : Shri Ashwani Kumar Respondent by : Smt.Jyoti Kumari, DR

Date of hearing : 16.03.2015 Date of Pronouncement : 16.03.2015

Per BHAVNESH SAINI, J.M. :

This appeal filed by the assessee is directed against

the order of learned Commissioner of Income Tax-III,

Ludhiana dated 14/17.11.2014 rejecting the application

under section 12AA of the Income Tax Act, 1961.

2. Briefly, the facts are that the assessee trust filed

application for registration under section 12AA of the Act

before the learned Commissioner of Income Tax in prescribed

form. The main objects of the assessee are running of

educational association in the name of GHG academy, the said

school running classes from nursery to 10+2. Another school 2

is also purchased. The application was forwarded to the

Assessing Officer and the Assessing Officer sent his report

dated 25.8.2014. In order to satisfy the conditions necessary

for registration, a questionnaire dated 29.8.2014 was issued

enclosing therewith the report of the Assessing Officer for

assessee's comments requiring to furnish information. The

proceedings were not attended to by the assessee. Further

questionnaire was issued on 26.9.2014 seeking reply of the

assessee. On 2.10.2014 the assessee filed written reply.

According to the learned Commissioner of Income Tax, the

assessee did not controvert the report of the Assessing

Officer. Therefore, the learned Commissioner of Income Tax

was of the view that the assessee did not perform the

activities of the society as per the aims and objects of the

trust deed. According to the learned Commissioner of Income

Tax, the assessee did not offer any explanation with regard to

the misuse of the society's funds. In the absence of the

required information/details, verification of the facts cannot

be carried out. Therefore, the registration application under

section 12AA of the Act was rejected.

3. We have heard the learned representatives of both the

parties and perused the material available on record. The

assessee in the Paper Book filed the copies of the notices

issued by the I.T.O.-IV, Moga, Head Quarter Jagraon seeking

various details from the assessee and the assessee in

response thereto, filed reply alongwith documents on

17.7.2014 and 19.8.2014. The assessee also filed copy of the 3

letter issued by the I.T.O.-IV, Head Quarter (Judicial) dated

29.8.2014 seeking several queries from the assessee, which

was replied to by the assessee on 2.10.2014. The learned

counsel for assessee referring to these documents submitted

that complete information and details were furnished before

the I.T.O.-IV, Moga, Head Quarters Jagraon as well as before

the I.T.O. Head Quarters (Judicial). Therefore, the findings of

the learned Commissioner of Income Tax are incorrect that no

complete details/information have been provided.

Considering the above documents on record, we are of the

view that the assessee has filed required details before the

I.T.O.-IV, Moga, Head Quarters Jagraon as well as before the

I.T.O. Head Quarters (Judicial). Therefore, it was the duty of

the learned Commissioner of Income Tax to consider the

material on record and should have given findings of fact on

merits instead of rejecting the application of the assessee by

stating that no required details are filed on record.

According to section 12AA of the Act, the Commissioner of

Income Tax on receipt of the registration application should

have satisfied himself about the objects of the trust or

institution and genuineness of its activities before granting

registration or rejecting the registration application.

However, no such findings have been given on both the issues.

Further it appears from the notices issued by the I.T.O.-IV,

Moga, Head Quarters Jagraon and I.T.O. Head Quarters

(Judicial) enquiries have been conducted by the I.T.O.-IV,

Moga, Head Quarters Jagraon and I.T.O. Head Quarters

(Judicial). The requirement of law is that the enquiries 4

should have been conducted by the learned Commissioner of

Income Tax himself on registration application and he should

have satisfied himself about the objects of the trust or

institution and the genuineness of its activities. It appears

that no such enquiries have been conducted by the learned

Commissioner of Income Tax and no documents furnished by

the assessee have been taken into consideration. The issue

on misuse of society's funds is not within the domain of the

learned Commissioner of Income Tax to be considered at the

stage of grant of registration to the assessee. It is a matter

of regular assessment to be considered by the Assessing

Officer. It, therefore, appears that in the absence of proper

enquiry into the matter as per the requirement of section

12AA of the Act by the learned Commissioner of Income Tax,

the matter requires reconsideration at the level of learned

Commissioner of Income Tax-III, Ludhiana.

4. In view of the above discussion, we set aside the

impugned order and restore the matter in issue to the file of

the learned Commissioner of Income Tax-III, Ludhiana with

direction to redecide the registration application of the

assessee in accordance with law by following the provisions of

section 12AA of the Act strictly and the learned Commissioner

of Income Tax shall decide the registration application on

merits after giving reasonable sufficient opportunity of being

heard to the assessee. The learned Commissioner of Income

Tax shall decide the matter within one month from receipt of

this order.

5

5 In the result, the appeal filed by the assessee is

allowed for statistical purposes.

Order pronounced in the open court on this 16th day of

March, 2015.

Sd/- Sd/- (T.R.SOOD) (BHAVNESH SAINI) ACCOUNTANT MEMBER JUDICIAL MEMBER

Dated : 16 t h March, 2015

*Rati*

Copy to: The Appellant/The Respondent/The CIT(A)/The CIT/The DR.

Assistant Registrar, ITAT, Chandigarh