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2020 (2) TMI 1451 - HC - Income TaxExemption u/s 11 - grant of registration u/s 12A - Tribunal directed the Commissioner of Income Tax to accord registration to the Respondent Assessee Trust under Section 12A - HELD THAT - Tribunal ought to have remanded the case back to the learned Commissioner of Income Tax, so that the requisite informations/documents furnished by the Assessee Trust could be examined and verified by the learned Commissioner of Income Tax, who was to consider the said application on merits. However, the fact remains that the Trust stands registered for the last ten years in pursuance of the impugned order of the learned Income Tax Appellate Tribunal. It was also open for the Revenue Authorities to take steps for cancellation of the registration, if there was any material against the Assessee Trust or they have violated the conditions of registration or the provisions of the Act in any manner. That course is even now open to the Revenue Authorities. We do not find any useful purpose to be served by now remanding the case back to the learned Commissioner of Income Tax to consider the said application under Section 12A of the Act afresh at this stage, as the said registration already stands granted about ten years back and therefore, we dispose of the present appeal filed by the Revenue only by making an observation that if any breach or violation on the part of the Respondent/Assessee Trust is found, they will be free to proceed against the Assessee/Trust in accordance with law.
Issues:
1. Appeal against the order of the Income Tax Appellate Tribunal directing registration under Section 12A of the Income Tax Act. 2. Compliance of requirements by the Assessee Trust before the Commissioner of Income Tax. 3. Tribunal's independent opinions on the compliance and registration of the Assessee Trust under Section 12A. 4. Applicability of the judgment in the case of Commissioner of Income-tax (Exemptions) vs. Jagannath Gupta Family Trust. 5. Registration already granted to the Assessee Trust and the possibility of cancellation by Revenue Authorities. Issue 1: Appeal against the order of the Income Tax Appellate Tribunal The appeal was filed by the Revenue against the order of the Income Tax Appellate Tribunal directing the Commissioner of Income Tax to grant registration to the Assessee Trust under Section 12A of the Income Tax Act. The Tribunal had based its decision on the compliance and activities of the Assessee Trust, as detailed in its order. Issue 2: Compliance of requirements by the Assessee Trust The Assessee Trust did not appear before the Commissioner of Income Tax after being asked to furnish seven documents/informations for its application under Section 12A. Despite this, the Tribunal, in its independent opinion, found that some compliances were met by the Assessee Trust and directed the Commissioner of Income Tax to grant registration under Section 12A without further investigation. Issue 3: Tribunal's independent opinions on compliance and registration The Tribunal considered various aspects, including the activities of the Assessee Trust, the nature of fees charged, and the charitable nature of the trust's objects. It concluded that the registration should be granted as the trust's income was not used for purposes other than its objectives, and the fees charged were not exorbitant. The Tribunal emphasized that the registration should not be denied based on grounds irrelevant at the registration stage. Issue 4: Applicability of the judgment in the case of Commissioner of Income-tax vs. Jagannath Gupta Family Trust The Appellant/Revenue cited a Supreme Court judgment in support of its argument. However, the Court did not delve into the specifics of this judgment in the detailed analysis. Issue 5: Registration already granted and possibility of cancellation The Respondent/Assessee Trust had already been granted registration based on the Tribunal's order from ten years ago. The Court noted that the Revenue Authorities could take steps to cancel the registration if any violations were found. The Court decided not to remand the case back to the Commissioner of Income Tax, as the registration had been in effect for a significant period. In conclusion, the appeal was disposed of with the observation that if any violations were found, the Revenue Authorities could take appropriate action against the Assessee Trust in accordance with the law.
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