2023 (5) TMI 573 - AT - Income Tax

Benefit of section 11 12 - registration u/s 12A denied for year under consideration - HELD THAT - This Tribunal in second round of litigation 2022 (6) TMI 1393 - ITAT INDORE has specifically held that the registration ought to have been granted from 01.04.1999 and directed the Ld. CIT(E) rectify the order and grant registration w.e.f. 01.04.1999. Accordingly, in the facts and circumstances of the case and in pursuant to the registration granted to the assessee u/s 12A w.e.f. 01.04.1999, the assessee is eligible for exemption u/s 11 12 of the Income Tax Act for year under consideration and consequently, the addition made by the assessee is defected. Since, the benefit of exemption u/s 11 12 of the I.T. Act is granted to the assessee. We accordingly dismissed.

Summary

Issues involved:
The issues involved in the judgment are denial of exemption u/s 10(23)(C)(iiiad) and registration u/s 12AA(2) for Assessment Year 2000-01.

Denial of Exemption u/s 10(23)(C)(iiiad):
The assessee, a society registered under M.P. Registration Act, 1973, was denied exemption u/s 10(23)(C)(iiiad) by the Ld. AO, who assessed the income at Rs. 36,05,590/-, including grant in aid receipt. The Ld. CIT(A) upheld this denial, stating that the assessee did not fulfill the conditions under u/s 10(23)(C)(iiiad) as it was not solely existing for education and its gross receipt exceeded Rs. 1 crore. However, the Tribunal later granted registration u/s 12A w.e.f. 01.04.1999, making the assessee eligible for exemption u/s 11 & 12 of the Income Tax Act for the year under consideration. Consequently, the denial of exemption u/s 10(23)(C)(iiiad) became academic and the appeal was allowed.

Registration u/s 12AA(2):
Initially, the registration u/s 12A was granted to the assessee society w.e.f. 01.04.2003, which led to the denial of benefits u/s 11 & 12 of the Act for the year under consideration. However, the Tribunal directed the Ld. CIT(E) to rectify the order and grant registration w.e.f. 01.04.1999. Subsequently, the assessee became eligible for exemption u/s 11 & 12 of the Income Tax Act for the relevant assessment year. The Tribunal dismissed the other grounds raised for exemption u/s 10(23)(C)(iiiad) as academic, as the benefit of exemption u/s 11 & 12 was granted to the assessee. Ultimately, the appeal of the assessee was allowed for statistical purposes.