9911796707
TMI Blog2012 (5) TMI 183X X X X Extracts X X X X X X X X Extracts X X X X ..... egistration to the assessee for the sole reason that the assessee's activities are in the nature of trade, commerce or business. In this regard, the DIT(E) has referred to the fact that there were receipts of huge amounts out of sale of houses which is nothing but business and commercial activity, though with a low profit. The DIT(E) has also further held that the assessee was having income by way of lease rent which is nothing but business income by exploiting property commercially in a systematic manner. - held that:- the above reasons cannot be the basis to hold that the activities of the assessee are not genuine. - assessee has made out a prima facie case for grant of an order of stay. - stay granted. - S.A. No. 126/Mum/2012 (Arising ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee u/s.12A of the Act. The show cause notice was issued because, according to the DIT(E), the objects of the assessee were in the nature of trade, commerce or business and in view of the amended provisions of sec. 2(15) of the Act, the assessee has to be regarded as carrying on non-charitable activities calling for cancellation of the registration already granted to the assessee. The DIT(E), by an order dated 22-12-2011, cancelled the registration already granted to the assessee. The cancellation of registration was done with retrospective effect from the assessment year 2009-10. Aggrieved by the aforesaid order of the DIT(E), the assessee has filed an appeal, being ITA No.435/Mum/2012, before the Tribunal. 4. For assessment year 2009 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... OT 304/[2010] 7 taxmann.com 100 (Mum.). In the aforesaid case, the assessee sought stay of recovery of outstanding demand of interest u/s.201(1A) of the Act in an appeal filed against the order declaring the assessee to be an assessee in default in respect of taxes u/s.201(1) of the Act. The question arose as to whether such an application for stay of recovery of outstanding demand is maintainable, when the subject matter of the appeal before the Tribunal was not the order u/s.201(1A) of the Act. This Tribunal held as follows : "Where circumstances so justify, and if the language of the proviso to s. 254(2A) warrants it, the power to grant stay can also be exercised over proceedings which are strictly not in appeal before the Tribunal but ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... interest recovered in the meantime can be refunded to the assessee and no prejudice would be caused. That is so in all cases before the Tribunal where the successful assessee gets refund of the taxes including interest in appropriate cases. If that be the criterion, the power to grant say vested in the Tribunal would be meaningless and can, in every case, be thwarted by such an argument. The prejudice or damage caused to the assessee is that today the interest would be recovered, which the present case is a substantial amount of Rs.8.9 crores, depleting the working capital or liquid funds of the assessee even when the very question whether the assessee was in default in pending adjudication before the Tribunal. An assessee may be forced to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ipts of huge amounts out of sale of houses which is nothing but business and commercial activity, though with a low profit. The DIT(E) has also further held that the assessee was having income by way of lease rent which is nothing but business income by exploiting property commercially in a systematic manner. The DIT(E), therefore, came to the conclusion that the assessee did not exist for a charitable purpose. He further held that once it is found that the assessee did not exist for charitable purposes, then the activities of the assessee become non-genuine. 7. We are of the view that prima facie the above reasons cannot be the basis to hold that the activities of the assessee are not genuine. In this regard, the provisions of sec. 12A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s that the case made out by the DIT(E) for cancelling registration granted to the assessee u/s.12AA(3) on the ground that the assessee's activities are not genuine cannot be sustained. If a trust or charitable institution carries on business, that by itself cannot lead to an inference that its activities are not genuine. It appears to us that none of the conditions warranting cancellation of registration already granted exist or have been made out by the DIT(E) in the impugned order. We make it clear that the observations made above are only for disposal of the stay application. 10. We are of the view that the assessee has made out a prima facie case for grant of an order of stay. We are also of the view that the assessee being an autho ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
