9911796707
TMI Blog2023 (8) TMI 327X X X X Extracts X X X X X X X X Extracts X X X X ..... 01.2015 the assessee would duly be entitled for the benefit of Sections 11/12 of the Act for the year under consideration i.e. A.Y. 2015-16. As the A.O had in the course of the assessment proceedings summarily rejected the assessee s claim for exemption u/s. 11/12 of the Act, i.e., without looking into the other aspects, therefore, the matter in all fairness requires to be restored to his file for framing of a fresh assessment in light of my aforesaid observations. What was required to be looked into by AO was as to whether or not any assessment for the year under consideration i.e. A.Y.2015-16 was pending on the date of which registration was granted, i.e., on 20.04.2017, which material aspect we are afraid had absolutely been lost sight of by him while disposing off the appeal. The observations recorded hereinabove are confined to the assessee s entitlement for the relief contemplated in CBDT Circular No. 01/2015 (supra) and the same would not come in the way of the A.O as regards making of further verifications as regards the assessee s entitlement for exemption u/s. 11/12 of the Act for which, he shall remain at a liberty to carry out necessary verifications. Accordingly, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ucational society registered under Madhya Pradesh Society Adhiniyam, 1973 had e-filed its return of income for A.Y.2015-16 on 07.12.2015, declaring an income of Rs. Nil. Subsequently the case of the assessee society was selected for scrutiny assessment u/s. 143(2) of the Act. 4. During the course of the assessment proceedings, it was observed by the A.O that the assessee had claimed deduction of Rs. 11,47,592/- u/s. 10(23C)(iiiad) of the Act. The A.O was of the view that as the gross receipts of the assessee society during the year under consideration were Rs. 1,31,77,714/-, therefore, it was ineligible for deduction u/s. 10(23C)(iiiad) of the Act. On being confronted with the fact as regards its ineligibility for deduction u/s. 10(23C)(iiiad) of the Act, it was submitted by the assessee society that it had applied for registration under Sec.10(23C)(vi) of the Act with the CIT(Exemption), Bhopal in Form 56D on 27.07.2015, which, however, was rejected by him on 20.07.2016. It was submitted by the assessee before the A.O vide its letter dated 08.12.2017 that it had also vide Form 10A on 26.06.2016 applied for registration u/s. 12A of the Act with the CIT(Exemption), Bhopal, which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A of the Act in the succeeding assessment year i.e. A.Y.2016- 17 on 26.06.2016/30.09.2016 (in the new format) in Form 10A which was granted by the CIT(Exemption), Bhopal vide his order dated 20.04.2017, i.e., at a time when assessment for A.Y.2015-16 was pending before the A.O, therefore, in light of the aforesaid CBDT Circular No. 1/2015 dated 21.01.2015 the assessee was duly entitled for benefit of Section 11/12 of the Act. My attention was drawn by the Ld. AR to the CBDT Circular No. 01/2015 dated 21.01.2015, Page 6-7 of APB. Taking me through Para 8.2 Para 8.3 of the aforesaid circular, it was submitted by the Ld. AR that in light of clearly worded CBDT Circular No. 01/2015, dated 21.01.2015, i.e., a benevolent circular that was binding on the department there was no justification for the lower authorities to have declined the assessee s claim for deduction u/s. 11/12 of the Act. My attention was further drawn by the Ld. AR to the demand notice u/s. 156 of the Act dated 21.12.2017 which therein proved that on 20.04.2017, i.e., the date of registration u/s. 12AA of the Act by the CIT (Exemption), Bhopal, the assessment in the case of the assessee for the year under considerati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case before me in the backdrop of the contentions advanced by the Ld. Authorized Representatives of both the parties and the orders of the lower authorities. Admittedly, it is a matter of fact borne from record that the assessee society had applied for registration u/s. 12AA of the Act in Form 10A on 26.06.2016, which, thereafter, was revised by him in the new format on 30.09.2016. As is discernible from the record the CIT(Exemption), Bhopal had vide its order dated 20.04.2017 granted registration u/s. 12AA of the Act to the assessee society. Also, it is an admitted fact that the order of registration u/s. 12AA of the Act dated 20.04.2017 specifically makes a mention that the provisions of Sections 11/12 of the Act shall apply from A.Y.2017-18. Although, the order of registration u/s. 12AA of the Act dated 20.04.2017 reveals that the provisions of Sections 11/12 of the Act would only be applicable to the assessee from A.Y.2017-18 onwards, but the CBDT Circular No. 01/2015 (supra) as had been pressed into service by the Ld. AR comes the rescue of the assessee. Before proceeding any further it would be relevant to cull out the CBDT Circular No. 01/2015 dated 21.05.2015, which reads a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the aforesaid CBDT Circular No. 01/2015 (supra), it transpires that in order to remove hardships in genuine cases caused due to non-application of registration for the period prior to the year of registration, the same comes to the rescue of the assessee for a period prior to the year of registration. On carefully scrutinizing the aforesaid CBDT Circular No. 01/2015 (supra), I find that as pursuant to the amendment to Section 12A of the Act vide the Finance Act, 2007 w.e.f. 01.06.2007, in a case where registration is applied after 1st June, 2007 the benefit arising therefrom is to be allowed only prospectively, therefore, the legislature in all its wisdom had carved out an exception to the same as per which the benefit of Sections 11/12 of the Act would be available to an assessee for a period prior to the year of registration despite the fact that no application for registration for the said period had been filed. The only rider/pre-condition which is required to be satisfied for bringing a case within the realm of the CBDT Circular No. 01/2015 (supra) is that the assessment proceedings for the said earlier assessment year are pending before the A.O on the date of registration u/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. 143(3) dated 21.12.2017, were very much pending on 20.04.2017, i.e., the date on which the order granting registration u/s. 12AA of the Act for A.Y.2016-17 was passed by the CIT(Exemption), Bhopal. As the CBDT circular No. 01/2015 (supra) being a benevolent circular is binding on the department, therefore, it is difficult for me to comprehend as to why effect to the same had not been given by the lower authorities. 12. At this stage, I may herein observe that Shri G.S Agrawal, Ld. AR on being specifically queried as to whether or not at any stage registration of the assessee society was refused u/s. 12AA of the Act, had answered in the negative. Although the registration in the case of the assessee society was declined by the CIT(Exemption), Bhopal u/s. 10(23C)(vi) of the Act, vide his order dated 20.07.2016 for the year under consideration i.e. A.Y.2015-16 onwards, but the same to my understanding will not have any bearing on the assessee s entitlement for the relief contemplated by the CBDT Circular No. 01/2015 (supra), as the same carves out as an exception the non- applicability of the same only in a case where registration on an earlier occasion was refused to the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
