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TMI Blog2022 (2) TMI 162X X X X Extracts X X X X X X X X Extracts X X X X ..... Act, be set aside and the application of the assessee seeking registration u/s. 12AA be restored back to the file of the ld. CIT(E) for fresh decision on the application filed by the assessee for grant of registration u/s. 12AA of the 1961 Act. Reference is drawn to the provisions of Section 12AA which obligates/empowers ld. CIT(E) to make enquiries as to the genuineness of the objects and activities of the trust/institution seeking registration u/s. 12A and the compliances of such requirements of any other law for the time being in force by the trust/institution as are material for achieving its objects and further the ld. CIT(E) is also empowered to make such inquiries as he deemed necessary in this behalf, which may requires verification of records, inquiries to be made as to genuineness of the activities of trust/institution and investigation of facts in connection therewith. The relevant provision of the statute to that effect are contained in Section 12AA(1)(a) of the 1961 Act. Now, in denovo proceedings as ordered by us, the assessee is directed to file all necessary replies before ld. CIT(E) to queries as were raised or as may be raised by ld. CIT(E) in connection wit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the assessee is working for the development of legal science and studies, assisting in development of progress of sound legislation and legal profession including safeguarding the rights, privileges and interests of Advocates on its rolls. The assessee has claimed that it is also maintaining a library of legal literature and other subjects likely to be useful to the Members of the Association. 2.2. The assessee has also claimed that by virtue of mutuality of benefit, it never filed its return of income with Department since its inception, although it has claimed that it was registered way back in 1958. 2.3. So far so good, but the trigger came when the assessee was visited by a notice u/s. 142(1) dated 15.03.2018 issued by Revenue for the assessment year(ay) 2017-18, whereby Revenue asked the assessee to file its return of Income for the ay: 2017-18. The reason and background for issuing the aforesaid notice u/s. 142(1) by Revenue and directing the assessee to file its return of income for ay: 2017-18, was that during the demonetization period (09.11.2016 to 30.12.2016), the assessee has deposited substantial cash amount of ₹ 14,94,732/- in its bank account number 102 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cash deposit only related to these collections. 5. Cash is not deposited out of the personal savings of the society. The financial statements are all inclusive. 6. The Association has not filed the income tax return. 7. Partnership deep is not applicable. 8. The audit report along-with the financial statements is enclosed. 9. The balance sheet and Capital account for financial year 2015-16 and 2016-17 is being enclosed which carries the General Fund account. The AO observed from the income and expenditure statement and Balance Sheet submitted by the assessee, following receipts and expenditure incurred by the assessee: Receipts Expenditure Excess over Expenditure shown ₹ 4,73,55,978/- (including interest income ₹ 6,04,963/- ₹ 75,42,717/- and Rent ₹ 9,57,586/- ₹ 3,97,31,556/- ₹ 76,24,422/- Thereafter, the assessee came forward and filed its return of income for ay: 2017-18 in pursuance to notice's issued by Revenue u/s. 142(1) of the 1961 Act, vide acknowledgement No. 27650204023 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t as well the same was posted at e-filing portal also, wherein specific queries, as many as 26 queries were raised by ld. CIT(E) in connection with the application for registration u/s. 12A of the 1961 Act filed by the assessee on 02.07.2020. The said notice dated 18.11.2020 is placed on record in file in paper book filed by the assessee, at page 94-96. Reference is drawn to the provisions of Section 12AA which obligates/empowers ld. CIT(E) to make enquiries as to the genuineness of the activities and objects of the trust/institution seeking registration u/s. 12A and the compliances of such requirements of any other law for the time being in force by the trust/institution as are material for achieving its objects and further the ld. CIT(E) is also empowered to make such inquiries as he deemed necessary in this behalf, which may requires verification of records, inquiries to be made as to genuineness of the activities of trust/institution and investigation of facts in connection therewith. The relevant provision of the statute to that effect are contained in Section 12AA(1)(a) of the 1961 Act. 2.8. In the meantime, the assessee decided to invoke revisionary powers of ld. Commissi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by filing revisionary petition u/s. 264 with ld. CIT on 17.12.2020. The Hon'ble Jurisdictional High Court also observed in its order dated 09.09.2021, as under: As to last submission of learned Senior Counsel that by virtue of proceedings under Section 270A of the Act having been dropped, the petitioner's revision became infructuous, we may only observe that the submission is ill-conceived. The remedy of Revision is a statutory remedy. Once availed, it may never be adversely affected by the conduct of the respondent-authority, unless it has a beneficial impact on the assessee. Needless to clarify that the revision filed by the petitioner/assessee shall be dealt with and decided by the Revising Authority, as expeditiously as possible, preferably within a period of three months subject to the petitioner not seeking any undue adjournment. The said revision shall be decided on its own merits without being influenced by the fact that the penalty proceedings had been initiated and dropped by the Assessing Authority, behind the back of the petitioner. With the above observations, the writ petition is dismissed. As could be seen that although the writ petition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... portunity of being heard to the assessee by issuing office letter F. No. ITBA/EXM/F/41/2020-21/1028647226(1), dated 18.11.2020, which was sent by ld. CIT(E) to assessee's address by speed post as well the same was posted at e-filing portal also, wherein specific queries, as many as 26 queries were raised by ld. CIT(E) in connection with the application for registration u/s. 12A of the 1961 Act filed by the assessee on 02.07.2020. The assessee filed its reply on 29.12.2020 before ld. CIT(E) in reply to aforesaid office letter dated 18.11.2020, which is reproduced hereunder: Before Commissioner Income Tax Exemptions Lucknow. This is to bring to your kind notice that a petition under section 264 of the Income Tax Act, 1961 has been preferred before Hon'ble Commissioner of Income Tax Allahabad for the Assessment Year 2017-2018. As the High Court Bar Association is not a taxable entity as per the decision of Hon'ble Supreme Court of India in the matters of High Court Bar Council Maharashtra vs. CIT 1981. The present application to accord approval under section 12AA of the Income Tax Act made by previous committee of HCBA Allahabad is not pressed by the present committee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shtra v. CIT 1981. As we have already seen that the assessee has availed alternate remedy by filing revisionary petition u/s. 264 of the 1961 Act by invoking revisionary powers of ld. CIT, which was also recognized by Hon'ble High Court while dismissing writ petition filed by the assessee albeit the writ petition was dismissed later by Hon'ble High Court vide orders dated 09.09.2021, and directions were issued by Hon'ble High Court to Revenue to expeditiously dispose of assessee's revisionary petition filed u/s. 264 of the 1961 Act, for ay: 2017-18. Thus, in our considered view the assessee vide its reply dated 29.12.2020 filed before ld. CIT(E), merely required the ld. CIT(E) to hold the proceedings for grant of registration u/s. 12AA in abeyance till the disposal of revisionary petition u/s. 264 of the 1961 Act by ld. CIT. It is a different matter that the application for registration u/s. 12AA is to be disposed of by ld. CIT(E) within the time provided under the statute and the request of the assessee to keep it in abeyance may not be acceded to keeping in view statutory limitation of time imposed by the 1961 Act. Thus, under these circumstances wherein the appli ..... X X X X Extracts X X X X X X X X Extracts X X X X
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