9911796707
TMI Blog2008 (1) TMI 824X X X X Extracts X X X X X X X X Extracts X X X X ..... 's claim for exemption from payment of tax as a charitable institution was also declined. The petitioner challenged the assessment in first appeal on the ground of limitation as well as against disallowance of exemption claimed under section 16 of the Act. The first appeal was dismissed, against which the second appeal filed before the Tribunal was also dismissed. In this revision petition filed against the said order of the Tribunal, the petitioner has raised the question of limitation against the assessment as well as against disallowance of exemption claimed as a charitable institution under section 16 of the Act.We have heard learned counsel for the petitioner and the learned Government pleader. Learned counsel for the petitioner conte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the period of limitation available is only two years from the date of filing of the return as provided under section 39(6) of the Act. In the first place, we find that both the decisions relied on by the petitioner are rendered on the provisions of the 1950 Act and the assessment involved in this case is under the 1991 Act. Moreover, in one case referred to above, the Assessing Officer had issued notice to the assessee against which he filed regular return and in the other case the assessee had in fact filed return and in both cases assessments were made based on returns. However, in this case the assessee neither filed return before June 30, 1994, as required under section 35(1) of the Act nor did the officer issue any notice calling upon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... caping assessment under section 41. But for the initiation of assessment proceeding based on the belated return, the income chargeable to tax would have escaped assessment. Section 41 obviously does not provide for any procedure for assessment and the mandatory procedure for assessment prescribed under clauses (4) and (5) of section 39 consequently applies to an assessment under section 41 of the Act. Therefore, if the assessee fails to comply with the notices for production of accounts, an income escaping assessment also has to be completed to the best of judgment of the Assessing Officer as required under section 39(4) of the Act. We are, therefore, of the view that a section 39(4) assessment can be either a regular assessment pursuant to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s if the notice were a notice issued under that sub-section : Provided that the tax shall be charged at the rate at which it would have been charged if such income had not escaped assessment or full assessment, as the case may be : Provided further that the Agricultural Income-tax Officer shall not issue notice under this sub-section unless he had recorded his reasons for doing so." It is clear from the opening words of the section that an income escaping assessment under section 41 of the Act is permissible, if the income chargeable to tax under the Act has escaped assessment for any reason. The Legislature has not confined the authority of the officer to make income escaping assessment to any particular situation or impose any conditio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... institution but an association of persons. Therefore, we are of the view that the claim of exemption under section 16 of the Act does not really arise from the Tribunal's order, as the petitioner has not established compliance with the procedure for getting exemption. Besides, the benefit which the charitable trust constituted by the petitioner enures only to members of the Jain community and it is to be noted that the Supreme Court in State of Kerala v. M. P. Shanthi Varma Jain [1998] 6 KTR 461, held that a charitable institution constituted for the benefit of a community, is not entitled to exemption. In view of the above findings, the contentions raised by the petitioner are not tenable and consequently the revision petition is dismisse ..... X X X X Extracts X X X X X X X X Extracts X X X X
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