2018 (5) TMI 950

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....as M/s. St. Xavier's School in Burdwan. On information, the AO reopened the case of the assessee by issuing notice u/s 148 of the Income Tax Act, 1961 (Act). In response to which, the assessee filed return of income declaring total income at 'nil'. Notices u/s 143(2) and 142(1) of the Act were issued, in compliance of which, the AR and the accountant of the assessee appeared before the AO. 3. During the reopening proceedings, the AO found the assessee claimed exemption u/s 11 of the Act on gross receipt of Rs. 1,66,30,938/- being the activities of charitable in nature. On examination of record the AO found that no registration u/s 12A or approval u/s 10(23)(c)(vi) of the Act was granted to the assessee and denied the benefit of claim u/s....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....peared on behalf of the assesee. After hearing the ld. DR, we find the issue is covered by the decision of Co ordinate Bench of Cochin Tribunal Tribunal in the case of SNTP Yogam vs ADIT (E) in ITA NO.503 to 507 and 569/Cochin/2014 for A.Yrs.2006-07 to 2009-10 and 2010-11, we proceed to dispose of the appeal perusing the materials available on record. There is no dispute with regard to granting of registration u/s 12A of the Act and it was given effect from 25.03.2013. The AO denied the benefit u/s 11 of the Act only for the reason that no registration was granted by the income tax department to claim exemption u/s 11 of the Act. The CIT(A) was of the opinion that assessments for all these A.Ys. 2008-09 to 2012-13 are pending with the autho....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....he meaning of that term as envisaged under the proviso. It follows there-from that the assessee which obtained registration u/s 12AA of the Act during the pendency of appeal was entitled for exemption claimed u/s 11of the Act. 7.3. The explanatory Memorandum to Finance (No.2) Bill, 2014 which sought to amend section 12A explains the objects and reasons for making such amendments. The explanation makes it clear that it was in order to provide relief to such trusts in respect of which, due to absence of registration u/s 12AA tax liability got attached though otherwise they were eligible for exemption by fulfilling other substantive conditions that the amendment was brought in. That being so, denying such benefit to a trust like the a....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....or registration u/s 12A [for the AYs under dispute] has not yet been decided by the CBDT and, therefore, the total incomes of the assessee were to be assessed as per commercial principles. The CIT (A) was also not justified in taking a similar stand that of the AO, without taking cognizance and intention of the amendment to s. 12A of the Act. If no judicious or a liberal view is not taken either by the assessing authority or the appellate authority as in the case under consideration, the very purpose for which such an amendment to s. 12A of the Act enacted, in our view, would be defeated. We are also supported by the order of Kolkata Bench of ITAT in case of Sree Sree Ramkrishna Samity vs. DCIT (ITA No. 1680/2012, order dated 09.10.2015) wh....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....ndant. Applying this legal maxim, it would be just and fair to hold that the amendment in section 12A is brought in the statute to confer benefit of exemption u/s 11 of the Act on the genuine trusts which had not changed its objectives and had carried on the same charitable objects in the past as well as in the current year based on which the registration u/s.12AA is granted by the DIT (Exemptions)." 7.5 In light of the aforesaid reasoning and order of the Tribunal in case of Sree Sree Ramkrishna Samity(supra), we direct the Director of Income-tax(Exemption) to grant registration to the assessee trust for all the assessment years under dispute, subject to the following conditions, namely: "i) The registration U/S.12AA (1)(....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....)The SOCIETY/TRUST shall regularly file its Income Tax Return." 7. In the aforementioned decision, we find the Coordinate Bench of Cochin Tribunal placed reliance in the case of Sree Sree Samity in ITA NO.1680/Kol/2012 of Kolkata Tribunal wherein it was held that amendment to Section 12A w.e.f. 01.10.2014 is retrospective and observed that it is an established position in law that a proviso which is inserted to remedy unintended consequences and to make the provision workable, a proviso which supplies an obvious omission in the section and is required to be read into the section to give the section a reasonable interpretation, requires to be treated as retrospective in operation, so that a reasonable interpretation can be given to the se....