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TMI Blog2020 (12) TMI 550X X X X Extracts X X X X X X X X Extracts X X X X ..... e of the view that the matter has to be remitted to the file of A.O to consider the restoration of registration granted u/s 12A of the Act in the year 2016 and the order giving effect (OGE) for the A.Y 2009-10 and 2011-12 which is pending before the Assessing officer. Accordingly to meet the ends of justice, we restore the disputed issues in assessee s appeal to the file of the A.O for the limited purpose with the above directions and the A.O has to verify and examine the facts and do the assessment based on the Restoration of registration under 12A of the Act and allow the grounds of appeal of the assessee for statistical purpose. - ITA No. 877/Mum/2017 - - - Dated:- 17-11-2020 - Shri M Balaganesh, Accountant Member And Shri Pavan Kumar Gadale, Judicial Member For the Appellant : Shri Neeraj Sheth, AR For the Respondent : Shri Brajendra Kumar, DR ORDER PER PAVAN KUMAR GADALE - JM: The assessee has filed an appeal against the order of Commissioner of Income Tax (Appeals) -1, Mumbai passed u/s. 143(3) and 250 of the Income Tax Act, 1961. The assessee has raised the following grounds of appeal: 1. Re.: Non granting of exemption u/s. 11 1.1 T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dated 24.02.2014 referred at para 5.2 of the order. The A.O considering the submissions and the facts is of the view that the registration u/s 12A of the Act was cancelled on 08.12.2011 and trust has to be assessed under provisions of Sec. 2(15) based on the mutuality concept. Further the A.O also observed that, the assessee is running hotels, permit rooms and receipt of hire charges from marriage ceremonies and the ancillary objects. The A.O has dealt at para 5.3 of the order in respect of the activities of the assessee and the club is not open to general public. Entry into the club is also difficult for ordinary people and the assessee has not carried out any charitable activity. The A.O considered the various aspects of the memberships allotted to the public and observed that the assessee collecting membership fees and subscription fees depending on the category of members and getting membership into the club is a very difficult task. The A.O dealt on the judicial decisions and the circular of CBDT and observed that the assessee trust cannot be treated as a charitable and made the computation of the income as per the provisions of Sec. 2(15) of the Act and determined the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Act cannot be denied. The Ld. AR emphasized that the order of cancellation u/sec12A by the DIT(E) was challenged and the Hon ble ITAT has set aside the order of cancellation. The contention of the Ld.AR that the provisions of Registration 12A of the Act are effectively applicable for the present Assessment year and the assessee is entitled for exemption u/s 11 of the Act considering the decision of the Hon ble ITAT. The Ld. DR supported the order of the CIT(A) and submitted that the earlier year facts are different and cannot be considered for the present assessment year. The Ld. AR demonstrated the paper book referring to the order of rejection dated 08.12.2011 at page 93 to 99 cancelling the registration u/ 12Aof the Act effective from A.Y 2009-10 and at page100 to 107, on Appeal to Hon ble ITAT in ITA No. 324/Mum/2012 order dt 3- 3-2016.The coordinate bench of tribunal observed that the action of the DIT(E) in cancelling the registration is bad in law. We consider it appropriate to refer the observations of Hon ble ITAT at page 7 para 8 of the order as under: 8. We have further noticed that the Ld. DR appearing on behalf of DIT has not placed on record any evidence ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nal at page 9 para 8 of the order, which is read as under: 8. On a careful reading of the relevant extract from learned Commissioner (Appeals) s order, it is very much clear that the only reasoning on the basis of which she has upheld the rejection of assessee s claim of exemption under section 11 of the Act is due to withdrawal /cancellation of registration granted under section 12A of the Act, vide order dated 8th December 2011. Notably, against the aforesaid order of learned DIT (Exemp.) cancelling the registration granted under section 12A of the Act, the assessee approached the Tribunal and the Tribunal while deciding the issue in ITA no.324/Mum./2012, dated 3rd March 2016, set aside the order of learned DIT (Exemp.) and restored the registration granted under section 12A of the Act. It is relevant to observe, the reasoning on the basis of which learned DIT (Exemp.) withdrew/cancelled assessee s registration under section 12A of the Act, were adopted by the Assessing Officer while rejecting assessee s claim of exemption under section 11 of the Act in the impugned assessment year. However, the Tribunal while deciding the issue has categorically held that nothing has been b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... leaned Sr. Counsel for the assessee justifying the claim of exemption under section 11 of the Act. 8. We considering the factual aspects and restoration of Registration u/sec12A of the Act by the Hon ble Tribunal in the year 2016 are of the view that at the time of passing the assessment order for this Assessment year the Assessing officer does not have the knowledge or information that the Hon ble Tribunal has set aside the order of cancellation in the year 2016 as the Assessment order was passed for the present assessment year under 143(3) of the Act on 21.03.2015. Therefore, we are of the substantial view that the assessment without considering the restoration of registration u/s 12A of the Act is not a valid assessment. Further, for the earlier assessment year 2009-10 and 2011-12 the Hon ble ITAT in ITA No. 48/Mum/2013 and ITA No. 5610/Mum/2015 has set aside the order of the CIT(A) rejecting the exemption u/s 11 of the Act to the assessee. When the query was raised to the Ld. AR in respect of the passing of any order giving effect to the Hon ble ITAT order dated 31.01.2020. The Ld. AR expressed that no action was initiated on order giving effect (OGE) by the A.O and is in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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