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2023 (4) TMI 1049 - AT - Income Tax


Issues involved:
Delay in filing appeal before the Tribunal; Denial of exemption claimed under section 11 of the Income Tax Act; Validity of cancellation of registration under section 12A; Entitlement for exemption under section 10(23C)(vi).

Delay in filing appeal before the Tribunal:
The appeal was filed with a delay of 192 days, citing restrictions due to the lockdown imposed by the government. The Tribunal, after considering the reasons provided in the condonation petition, condoned the delay as it found that the assessee was prevented by a reasonable cause from filing the appeal on time. The appeal was then proceeded to be adjudicated on merits.

Denial of exemption claimed under section 11 of the Income Tax Act:
The assessee, involved in seed certification activities, had claimed exemption under section 11 of the Act for the assessment year 2016-17. However, the Assessing Officer (AO) denied the exemption, stating that the activities were profit-oriented and not charitable in nature. The Commissioner of Income Tax (Appeals) upheld this decision. On appeal to the Tribunal, the Tribunal found that the assessee was entitled to exemption under section 10(23C)(vi) based on a Supreme Court decision and directed the Revenue Authorities to allow the claim of exemption under section 11.

Validity of cancellation of registration under section 12A:
The AO observed that the registration under section 12A was canceled by the Director of Income Tax (Exemptions) on the grounds that the activities were not charitable in nature. The cancellation was further upheld by the High Court. However, based on a Supreme Court decision in a related case, the Tribunal concluded that the assessee was entitled to approval/exemption under section 10(23C)(vi) and directed the Revenue Authorities to allow the claim of exemption under section 11 of the Act.

Entitlement for exemption under section 10(23C)(vi):
The Tribunal, after considering the facts and relevant legal precedents, held that the assessee was entitled to approval/exemption under section 10(23C)(vi) of the Act. This decision was based on a Supreme Court judgment in a related case involving similar issues. Consequently, the Tribunal directed the Revenue Authorities to allow the assessee's claim of exemption under section 11 of the Income Tax Act, 1961.

 

 

 

 

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