9911796707
TMI Blog2021 (6) TMI 811X X X X Extracts X X X X X X X X Extracts X X X X ..... "1. The learned CIT-Exemption erred in law and on facts in not granting registration u/s. 12AA of ITA, 1961 to the Appellant (i.e. MESCO). 2. Appellant contends that, Appellant made detailed submissions upon all issues raised, whereas, learned CIT-Exemptions, declined registration u/s. 12AA on altogether erroneous and incorrect analogies without affording any further opportunity to the Appellant, to make a SAY in the matter and as such, vitiated principle of natural justice. 3. Learned CIT-Exemptions erred in law and on facts in holding that, a) Charging about 10% mark-up is a business activity b) Earning surplus of about 4% of revenue is not wafer-thin margin earned by charities c) Upon dissolution of MESCO, funds will be misu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... application, the ld. CIT (Exemption) issued a letter through ITBA portal on 30.01.2020 calling for certain information/clarification in order to enable him to satisfy himself as to the genuineness of the activities carried out by the appellant company. It is submitted before the ld. CIT (Exemption) that though the appellant company was incorporated in the year 2002 since it was under the bona-fide impression i.e. eligible for exemption u/s. 10(26BBB) of the Act and, therefore, no application for grant of registration was made earlier. It is only after the realization of this mistaken impression, an application was made for grant of registration u/s. 12A of the Act on 12.09.2019. The ld. CIT (Exemption) also perused the main objects as well ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cluded that the balanced funds of the appellant company, if any, shall be distributed amongst its members in proportionate to the capital held by them. Accordingly, denied the grant of registration vide order dated 31.03.2021. 6. Being aggrieved, the appellant is before us in the present appeal. 7. It is submitted that the appellant company was incorporated by Government of Maharashtra pursuant to the Resolution passed on 18.01.2002 with the objects of providing re-employment for ex-servicemen etc. The copy of the Resolution was also placed before us. It is submitted that the ld. CIT (Exemption) ought not to have rejected the grant of registration taking into consideration, the issues of assessment i.e. the assessee company is generating ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ividend amongst its members and does not set out a condition that the income earned by the appellant company shall be deployed for the objects of the company. This would make the appellant company a commercial organization. However, the view of the ld. CIT (Exemption) that the appellant company is a commercial organization merely because it is generating huge revenue from year to year with mark-up on the cost of 10% to 12% cannot be upheld. The ld. CIT (Exemption) had not considered the matter in proper perspective. Therefore, in the interest of justice, the matter should be remanded back to the file of the ld. CIT (Exemption) for de-novo consideration of application on the touchstone of law laid down by the Hon'ble Supreme Court in the ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
