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TMI Blog2012 (10) TMI 242X X X X Extracts X X X X X X X X Extracts X X X X ..... o grant renewal of approval u/s. 80G(5)(vi) of the IT Act on the following grounds : 1. That the Ld. CIT has erred in law as well as on facts and circumstances of the case rejecting the application u/s. 80G of the Income Tax Act, 1961. 2. That the ld. CIT has erred in law as well as on the facts and circumstances of the case the approval under section 80G of the Income Tax Act, 1961 has deemed to have been granted on 18.07.2010 as the application was received in CIT office on 19.01.2010 and order was passed on 27.07.2010. 3. That the impugned order dated 27.07.2010 of the ld. CIT is without jurisdiction. 4. That the impugned order dated 27.07.2010 of the ld. CIT is arbitrary and against the principles of natural justice and equity. 5. Any other relief as the Hon'ble Bench may consider fit on the facts and circumstances of the case. 2. Briefly, the facts, as noted in the impugned order, are that the assessee filed prescribed form before the ld. CIT on 19.01.2010 seeking renewal of approval already granted u/s. 80G(5)(vi) of the IT Act upto 31.03.2009. The Instrument of memorandum accompanied by the copy of registration under the Soci ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ship of college building. Before proceeding further, it was found necessary to rule out any beneficial interest of the trustees or office bearers of trust in the funds or income of the institution. However, according to the impugned order, the query of the department has been diluted. No sale deed of the land and building has been filed. It was also found that the provisions of section 11 have not been complied with because surplus which was transferred was more than 15% of the income. Accordingly, the renewal of approval u/s. 80G(5)(vi) was rejected. 3. The ld. counsel for the assessee contended that the registration u/s. 12AA of the IT Act is continuing in the case of the assessee. The assessee filed application for renewal on 19.01.2010, but the impugned order is passed on 27.07.2010, i.e., beyond six months from the receipt of the application. Therefore, according to rule 11AA(6) of the IT Rules, approval should be deemed to be granted. In support of the contention, he has relied upon the order of ITAT, Amritsar Bench in the case of S. Lakha Singh Bahra Charitable Trust v. CIT [2011] 133 ITD 201/15 taxmann.com 97 (copy of the same filed at paper book page 146). He ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re same as were considered in earlier year while granting approval u/s. 80G(5) of the IT Act and there is no change in the facts. Therefore, the approval should not have been rejected. He has also referred to RTI information (PB-51) regarding Shri Surendrajit Singh holding officiating charge of CIT, Aligarh, in which it was informed by the department under the RTI Act that no such information is maintained whether CIT, Ghaziabad Shri Surendrajit Singh was physically present at the office of CIT, Aligarh on 16.07.2010. He has referred to page 36 of the paper book regarding corpus funds and stated that the corpus fund was received in a sum of ₹ 8,90,000/- out of which ₹ 2,00,000/- was the balance of earlier year and ₹ 6,90,000/- was of the current year, which was appropriated towards civil construction work and no building was purchased in the year 2008-09. Therefore, there was no title deed as alleged by the ITO (Tech.). The assessee maintained proper books of account in which no defects have been pointed out and moreover, in the impugned order, it is stated that the issue of donation is not relevant to the extension of renewal u/s 80G(5) of the IT Act. Therefore, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g documents, namely :- ( i ) Copy of registration granted under section 12A or copy of notification issued under section 10(23) or 10(23C) ; ( ii ) Notes on activities of institution or fund since its inception or during the last three years, whichever is less ; ( iii ) Copies of accounts of the institution or fund since its inception or during the last three years, whichever is less. (3) The Commissioner may call for such further documents or information from the institution or fund or cause such inquiries to be made as he may deem necessary in order to satisfy himself about the genuineness of the activities of such institution or fund. (4) Where the Commissioner is satisfied that all the conditions laid down in clauses (i) to (v) of sub-section (5) of section 80G are fulfilled by the institution or fund, he shall record such satisfaction in writing and grant approval to the institution or fund specifying the assessment year or years for which the approval is valid. (5) Where the Commissioner is satisfied that one or more of the conditions laid down in clauses (i) to (v) of sub-section (5) of section 80G are not fulfilled, he shall reject the ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in not complying with the directions of the Commissioner under sub-rule (3), shall be excluded. 5.3 ITAT Amritsar Bench in the case of S. Lakha Singh Bahra Charitable Trust ( supra ) held - CIT has to pass an order either granting the approval or rejecting application within six months from the date on which such application for exemption is made; rejection of application beyond six months makes the assessee legitimately entitled for approval. 5.4 ITAT, Delhi Bench in the case of Maharishi Dayanand Education Society ( supra ), following its earlier decision, held that during the subsistence of registration u/s. 12A, the renewal of the assessee u/s. 80G could not be denied on the ground that the assessee does not carry out charitable activity. It was, therefore, held that renewal of approval u/s. 80G has wrongly been refused to the assessee. The CIT was directed to grant the same to the assessee. 5.5 ITAT Delhi Bench in the case of Gaur Brahmin Vidya Pracharini Sabha v. ( supra ) held - Assessee society formed for the purpose of establishing educational institution, not for any particular religion, community or cast having been grante ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... IT, Aligarh during the period 10.07.2010 to 18.07.2010 and no such information was maintained by the department whether he was physically present at the office of CIT, Aligarh. In view of the above facts, the ld. DR was directed to produce the jurisdictional order of the CIT, Aligarh. Despite giving sufficient time, no jurisdictional order of CIT, Aligarh dealing with the above matter was produced. The ld. DR filed copies of several letters which were written by him to the department for doing the needful and jurisdiction order of CIT, Aligarh between 19.01.2010 to 27.07.2010, but nothing was produced in this regard. These facts would clearly prove that the order sheet written by ITO (Tech.) on 08.07.2010 was not approved by Shri A.K. Jain, former CIT or Shri Surendrajit Singh, officiating CIT, Aligarh. Shri Virendra Singh, CIT, Aligarh who passed the order on 27.07.2010 was posted as CIT, Aligarh only on 22.07.2010. Thus, there was no reason to believe that any of the Commissioners, above, have called for any documents or information from the assessee institution in order to satisfy themselves about the genuineness of the activities of the assessee institution or the funds. The im ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly, we hold - ( i ) That the CIT, Aligarh has not conducted any enquiry into the matter in order to satisfy himself about the genuineness of the activities of the assessee institution or fund; ( ii ) That the impugned order is passed by the ld. CIT without giving opportunity of being heard to the assessee and in most mechanical manner, merely relying upon the order sheet dated 08.07.2010 recorded by ITO (Tech.); ( iii ) That the impugned order is passed beyond the period of 6 months from the date of filing of application and, therefore, provisions of Rule 11AA(6) of the IT Rules have been violated. Nothing could be attributed to the assessee for taking time in not complying with the directions of the ld. CIT because the ld. CIT never issued any direction as per above findings. Therefore, the assessee is entitled for grant of renewal of approval u/s. 80G(5) of the IT Act; ( iv ) That the reasons given by ITO (Tech.) for refusal to renew the approval u/s. 80G(5)(vi) are not valid in the eyes of law and since the assessee enjoyed registration u/s. 12AA of the IT Act continuously and also complied with the provisions of section 80G(5), therefore, renewal of approval ..... X X X X Extracts X X X X X X X X Extracts X X X X
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