2012 (3) TMI 662 - AT - Income Tax

Summary

Issues involved: Appeal against withdrawal of registration u/s 12AA of the Income Tax Act, 1961.

Summary:
The appellant filed an appeal against the withdrawal of registration u/s 12AA by the Ld. CIT-II, Agra. The registration was initially granted w.e.f. 01.04.2003, but a notice for withdrawal was issued w.e.f. Assessment Year 2009-10 under section 12AA(3) read with section 293C of the Act. The withdrawal was based on the grounds that the activities of the assessee were not deemed charitable under the proviso to section 2(15) inserted by Finance Act, 2008.

The appellant contended that the issue was similar to a previous case of Agra Development Authority, ITA No.447/Agr/2011. The ITAT found the facts to be identical to the Agra Development Authority case and referred to the objection raised by the Ld. Authorised Representative regarding the jurisdiction of the CIT to cancel registration earlier granted under section 12A of the Act. The ITAT upheld the objection, citing that the CIT's order was without jurisdiction as there was no provision in section 12AA for such cancellation.

The ITAT also highlighted the distinction between "approval" and "registration" under the Act, noting that section 293C, which deals with withdrawal of approval, cannot apply to a case of registration. Therefore, the impugned order was annulled due to lack of jurisdiction. The appeal of the assessee was allowed with no order as to costs.

Given the identical facts, the ITAT followed the decision in the Agra Development Authority case and allowed the appeal filed by the assessee. The issue was decided in favor of the assessee based on the preliminary objection raised regarding jurisdiction, without expressing any opinion on the merit and other aspects of the matter. The CIT was granted liberty to take action in accordance with the law if suggested.

In conclusion, the appeal filed by the assessee was allowed, maintaining consistency with the previous order of the ITAT in the Agra Development Authority case.

(Order pronounced in the open Court on 30.03.2012)