TaxTMI 
TaxTMI 
2018 (5) TMI 132
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....nd for the advancement and dissemination of knowledge; to promote Punjabi studies, to provide for research in Punjabi literature, to undertake measures for the development of Punjabi language and to progressively adopt it as a medium of instruction and examination for as many subjects as possible; to institute and confer degrees, diplomas and other academic distinctions; to organize university laboratories, libraries, museums and other equipment for teaching and research; to hold and mange trust and endowments which may be created in favour of the University; to confer honorary degrees in the manner laid down by the statutes; to demand and receive such fees and other charges as may be prescribed by the ordinances, to institute and award fellowships, scholarships, studentships, exhibitions and prizes in accordance with the statutes and ordinances." 3. The applicant society had filed an application in form No.10A on 22.4.2016 seeking registration u/s 12A of the Act. The same was rejected by the Ld.CIT(Exemptions) for the reason that the assessee had never in the past filed its return of income, claiming to be exempt u/s 10(23C)(iiiab), of the Act, which was incorrect. Further, the....
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....t it falls under the definition of section 10(23C)(iiiab) does not hold any ground in view of the Rule mentioned above. Further, the position taken by the University that it was not required to file returns if it claimed to be covered under section 10(23C)(iiiab) is patently misplaced. It is a well established principle that to avail the benefits of the clauses beneficial to the assessees claims have to be made which in Income Tax proceedings that can be done by no other means but filing returns. In the instant case there is a violation of provisions of section 139(4C)(e) of the Income Tax Act, 1961 which makes it mandatory to furnish a return in the prescribed form if the income of such University or educational institution referred to in sub-clause (iiiab) of section 10(23C) exceeds the maximum amount not chargeable to tax. The applicant may possibly take the plea that it had not been mandated in the Act. The recently incorporated provision however clarifies the legislative intent. Further in the absence of returns of income in the past the activities and the genuineness thereof cannot be examined. 7. when asked about the rationale behind the current application u/s 12A ....
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....it had PAN or not or the fact that it should have claimed the benefit u/s 10(23C)(iiiad) or u/s 10(23C)(vi) were not relevant for the purpose of grant of registration u/s 12A and the Ld.CIT(E) being guided by these factors alone had, therefore, erred in refusing grant of registration. Even otherwise, the Ld. counsel for assessee stated that it was an incorrect fact that the applicant-assessee had failed to furnish evidence in support of its claim of being covered by section 10(23C)(iiiab) when no such question had been asked from it during proceedings before the Commissioner. At this juncture, the Ld. counsel for assessee was asked whether or not the fact that it had not filed any income tax return was true or not, to which the Ld. counsel for assessee replied that it was true since it was eligible to claim exemption u/s 10(23C)(iiiab) of the Act. The Ld. counsel for assessee thereafter was asked as to how the genuineness of its activities could be verified in the absence of any return filed by it, to which the reply of the Ld. counsel for assessee was that the financial statements of the past years of the assessee society were periodically prepared and audited and its books of acc....
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....tion cannot be rejected. Income tax returns are not and cannot be the only basis of verifying the activities carried out by the applicant .As submitted by the Ld.Counsel for the assessee and as is evident from the order of the CIT(E) also,the applicant had filed its Financial Statements before the CIT(E). It was also stated by the Ld.Counsel for the assessee before us that these Financial statements were audited and that even complete Books of accounts were maintained by the applicant. The examination of these documents would sufficiently reveal the activities carried out by the applicant and whether they are being carried out as per the stated objects of the applicant University. The Ld.CIT(E) should have examined these documents for satisfying himself vis à-vis the genuineness of the activities carried out by the assessee society and not rested his conclusion solely on the basis that no Income tax returns were filed by the applicant University. Therefore, we cannot subscribe with the action of the CIT(E) in rejecting the application of the assessee merely for the reason that he was unable to satisfy himself vis-à-vis the genuineness of the activities carried out by ....