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TMI Blog2020 (6) TMI 506X X X X Extracts X X X X X X X X Extracts X X X X ..... lus income of Rs. 29,82,425 by an order u/s. 143(3) dated 29.8.2017. 4. Aggrieved by the assessment order, the assessee preferred appeal before the CIT(Appeals). Pending proceedings before the CIT(Appeals), the assessee has applied for registration u/s. 12AA on 21.09.2017 in Form No.10. By an order dated 9.3.2018, the CIT(Exemptions), Bangalore [CIT(E)] granted registration u/s. 12AA of the Act to the assessee. The assessee contended before the CIT(Appeals) that proviso to section 12A(2) states that, "where registration has been granted to the trust or institution under section 12AA, then, the provisions of sections 11 and 12 shall apply in respect of any income derived from property held under trust of any assessment year preceding the aforesaid assessment year, for which assessment proceedings are pending before the Assessing Officer as on the date of such registration and the objects and activities of such trust or institution remain the same for such preceding assessment year". The said proviso is squarely applicable to the assessee's case. The assessee contended that proceedings pending before the CIT(Appeals) is to be considered as assessment proceedings pending before the A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 12[(2) reads as follows: "Where an application has been made on or after the 1st day of June, 2007, the provisions of sections 11 and 12 shall apply in relation to the income of such trust or institution from the assessment year immediately following the financial year in which such application is made:" 7. He brought to our notice that the following proviso was inserted the Finance (No. 2) Act, 2014, w.e.f. 1-10-2014:- "Provided further that no action under section 147 shall be taken by the assessing officer in case of such trust or institution for any assessment year preceding the aforesaid assessment year only for non-registration of such trust or institution for the said assessment year. Provided also that provisions contained in the first and second proviso shall not apply in case of any trust or institution which was refused registration or the registration granted to it was cancelled at any time under section 12AA." 8. He also drew our attention to the explanatory note to the provisions of the Finance (No.,2) Act 2014 as given in CBDT No.1/15 dated 21.1.2015:- "Para 8.2 Non-application of registration for the period prior to the year of registration caused genui ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing in appeal before the first appellate authority. During such pendency, the assessee was granted registration u/s 12AA of the Act on 29.07.2013 w.e.f. the assessment year 2013-14. Those appeals were the continuation of the original proceedings and that the power of the Commissioner of Income-tax was co-terminus with that of the assessing officer [ADIT (Exemption) in the present case] were two well established principles of law. In view of the above and going by the principle of purposive interpretation of statues, an assessment proceeding which is pending in appeal before the appellate authority should be deemed to be 'assessment proceedings pending before the assessing officer' within the meaning of that term as envisaged under the proviso. It follows there-from that the assessee which obtained registration u/s 12AA of the Act during the pendency of appeal was entitled for exemption claimed u/s 11of the Act. 7.3 The explanatory Memorandum to Finance (No.2) Bill, 2014 which sought to amend section 12A explains the objects and reasons for making such amendments. The explanation makes it clear that it was in order to provide relief to such trusts in respect of which, due ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... id decision submitted that the Assessee should be allowed the benefit of exemption u/s.11 of the Act. 12. The learned DR relied on the order of the CIT(A) and submitted that the registration was granted to the Assessee only on 9.3.2018 but the order of AO was passed on 29.8.2017. Therefore the assessment proceedings were not pending as on 9.3.2018 and therefore the benefit of proviso to Sec.12A(2) of the Act cannot be extended to the Assessee. 13. We have carefully considered the rival submissions. The decision of the ITAT Cochin Bench in the case of SNDP Yogam (supra) is on identical facts of the case of the Assessee in this appeal and therefore the ratio laid down therein will apply to the present case also. As laid down therein, if during pendency of appeal before first appellate authority, assessee obtained registration under section 12AA and claimed exemption under section 11, the Assessee should be allowed the benefit of the proviso to Sec.12A(2) which provides that where registration has been granted to the trust or institution under section 12AA, then, the provisions of sections 11 and 12 shall apply in respect of any income derived from property held under trust of any a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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