2014 (2) TMI 269 - HC - Income Tax

Renewal of registration u/s 12AA - Held that - The assessee has not responded to the notice issued by the C.I.T. and no books of account were produced for verification - The Tribunal has passed the order without going into the merits of the case - After the order passed by I.T.A.T., the respondent-assessee has approached the C.I.T. and also filed the books of account and other documents for verification - The CIT has passed the fresh order - Decided against Revenue.

Summary

Issues:
1. Appeal against the order of Income Tax Appellate Tribunal allowing renewal of registration under Section 12A/AA of the Income Tax Act.
2. Clubbing of multiple appeals by the Tribunal and passing a common order.
3. Failure of the Tribunal to consider factual aspects and findings by the Commissioner of Income Tax.
4. Non-compliance by the assessee with the notice issued by the C.I.T.

Analysis:

1. The High Court heard the appeal filed by the revenue against the order of the Income Tax Appellate Tribunal, which had allowed the renewal of registration under Section 12A/AA of the Income Tax Act for the respondent-assessee. The C.I.T. had rejected the application for registration as the assessee did not comply with the notice to produce necessary documents. The Tribunal, in a common order, set aside the C.I.T.'s decision, citing the previous registration of the society under Section 12AA and renewal under Section 80G as grounds for renewal. The High Court noted that the Tribunal should have considered the factual aspects of each matter individually and the C.I.T.'s findings.

2. The revenue contended that the Tribunal erred in clubbing various appeals together and passing a single order, including appeals with distinct issues. The Tribunal's decision was criticized for not assessing the evidence regarding donations, lack of produced bills/vouchers, and non-compliance with the Department's notice. The High Court acknowledged the revenue's argument, emphasizing that each appeal should have been considered separately.

3. The High Court observed that the assessee had initially not responded to the C.I.T.'s notice and failed to produce books of account for verification. Although the Court was inclined to interfere based on these grounds, it noted that subsequent to the Tribunal's decision, the assessee approached the C.I.T., submitted the required documents, and obtained a fresh registration order. Consequently, as the C.I.T. had already issued a new order, the High Court disposed of the Tax Appeal, finding no substantial legal question remaining for consideration.

This detailed analysis of the judgment highlights the key issues raised in the appeal, the Tribunal's decision-making process, and the subsequent actions taken by the assessee and the C.I.T. to address the concerns raised during the legal proceedings.