Appeals allowed for fresh adjudication based on registration application decision

The Tribunal allowed the appeals for statistical purposes, setting aside the issues to the CIT(E) and the Assessing Officer for fresh adjudication based on the CIT(E)'s decision on the registration application under Section 12AA, considering the CBDT's order condoning the delay. The Tribunal emphasized the need for a proper opportunity of hearing and submission of all relevant details by the assessee.

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Issues Involved:
1. Grant of registration under Section 12AA of the Income Tax Act.
2. Denial of exemption under Sections 11 and 12 of the Income Tax Act due to absence of registration under Section 12AA.
3. Condonation of delay in filing the application for registration under Section 12AA.
4. Diversion of funds to the Infrastructure Development Fund by an overriding title as per the State Government order.

Issue-wise Detailed Analysis:

1. Grant of Registration under Section 12AA of the Income Tax Act:
The assessee filed an appeal against the order of the CIT(E), Lucknow, dated 02.12.2016, which rejected the application for registration under Section 12AA. The assessee argued that the CIT(E) erred in rejecting the application despite the Central Board of Direct Taxes (CBDT) condoning the delay in filing the application for the period from AY 2004-05 to 2009-10. The CIT(E) had granted registration effective from 23.07.2009, but the assessee sought registration from 01.04.2003. The Tribunal noted that the CIT(E) rejected the application because the assessee did not appear on the appointed date and failed to provide necessary details. The Tribunal set aside the issue to the CIT(E) for reconsideration, directing the assessee to submit all relevant details, including the CBDT order, and for the CIT(E) to pass a speaking order after granting a proper opportunity of hearing.

2. Denial of Exemption under Sections 11 and 12 of the Income Tax Act:
For AY 2007-08, 2008-09, and 2009-10, the CIT(A) upheld the Assessing Officer's decision to deny exemptions under Sections 11 and 12 due to the absence of registration under Section 12AA. The Tribunal noted that the original assessments were made without granting exemptions as the assessee was not registered under Section 12AA at the relevant times. The Tribunal set aside these issues to the Assessing Officer to decide afresh after the CIT(E), Lucknow, passes a decision on the registration application pursuant to the Tribunal's order in ITA No. 533/Del/2017.

3. Condonation of Delay in Filing the Application for Registration under Section 12AA:
The assessee had filed an application for condonation of delay under Section 119(2)(b) of the Income Tax Act for AY 2004-05 to 2009-10, which the CBDT condoned. Despite this, the CIT(E) did not grant registration for the retrospective period. The Tribunal directed the CIT(E) to consider the CBDT's order condoning the delay and to pass a speaking order on the application under Section 12AA after granting a proper opportunity of hearing to the assessee.

4. Diversion of Funds to the Infrastructure Development Fund by an Overriding Title as per the State Government Order:
For AY 2007-08, the CIT(A) upheld the addition of Rs. 4,64,67,240 by the Assessing Officer on account of diversion of funds to the Infrastructure Development Fund as per the State Government order. Similar issues were noted for AY 2008-09 and 2009-10, with additions of Rs. 2,63,14,404 and Rs. 5,28,15,855, respectively. The Tribunal noted that these issues were also linked to the registration under Section 12AA and set aside these appeals to the Assessing Officer to adjudicate afresh after the CIT(E)'s decision on the registration application.

Conclusion:
The Tribunal allowed the appeals for statistical purposes, setting aside the issues to the CIT(E) and the Assessing Officer for fresh adjudication based on the CIT(E)'s decision on the registration application under Section 12AA, considering the CBDT's order condoning the delay. The Tribunal emphasized the need for a proper opportunity of hearing and submission of all relevant details by the assessee.

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