2022 (4) TMI 1100

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....ce vide letter F.No.CIT(Exemp.)/Lko/80G/27/2017-18/4612 dated 02.05.2017which was sent to the address provided by the applicant via Speed Post , calling for specific queries regarding assesseee's application for registration/approval u/s 80G(5) , for compliance on 27.09.2017. The assessee's counsel appeared before ld. CIT(E) , and filed part reply. The ld. Counsel for the assessee sought adjournment, which was granted by ld. CIT(E) , and fresh date of hearing was fixed for 18.10.2017. None appeared before ld. CIT(E) on 18.10.2017 nor any application for adjournment was filed . The ld. CIT(E) observed that the assessee did not produced books of accounts and vouchers for verification. The ld. CIT(E) was pleased to dismiss/reject the application of the assessee for registration/approval u/s 80G(5),vide orders dated 18.10.2017.The ld. CIT(E) while rejecting application of the assessee for grant of registration/approval u/s 80G(5) was of the view, based upon material on record , that the assesseeis not solely existing for educational purposes. The ld. CIT(E) observed that the assessee is primarily engaged in running an educational institution on commercial lines without any element of c....

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....t is running its educational activities on commercial grounds, and also that the assessee has not worked towards the performance of objects set out in its Memorandum. Thus, the ld. CIT(E) rejected the application filed by the assessee for grant of registration /approval u/s 80G(5) of the 1961 Act. 3. Aggrieved, the assessee has filed an appeal with Income Tax Appellate Tribunal, Varanasi Circuit Bench, Varanasi, U.P..The ld. counsel for the assesseeopened the arguments before the Division Bench and submitted that proper and adequate opportunity of being heard was not granted to the assessee by ld. CIT(E), while dismissing application filed by the assessee before ld. CIT(E) for registration/approval u/s 80G(5) of the 1961 Act. The ld. Counsel for the assessee submitted that the assessee is duly registered u/s 12AA of the 1961 Act. The ld. Counsel for the assessee submitted that the assessee is engaged in the educational activities and is running school .The ld. Counsel for the assessee submitted that the assessee filed its application for registration/approval u/s 80G(5) of the 1961 Act, on 06.04.2017.The ld. CIT(E) issued notice dated 02.09.2017 fixing hearing for 27.09.2017. The ....

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....required these books of accounts, vouchers and evidences can be verified by ld. CIT(E). 4. The ld. CIT-DR also fairly submitted that keeping in view facts and circumstances of the case, the matter may be restored back to the file ofld. CIT(E) for denovo consideration of the application of the assessee for grant of registration/ approval u/s 80G(5) of the 1961 Act. 5. We have heard both the rival parties and perused the material on record. The assessee has claimed itself to be engaged in the educational activities. The assesse is registered u/s 12AA of the 1961 Act. The assessee filed an application for registration/approval u/s. 80G(5) of the Income Tax Act, 1961 , on 06.04.2017 with ld. CIT(E), Lucknow. The ld. CIT(E) was pleased to issue notice vide letter F.No. CIT(Exemp.)/Lko/80G/27/2017-18/4612 dated 02.05.2017 which was sent to the address provided by the applicant via Speed Post , calling for specific queries regarding assesseee's application for registration/approval u/s 80G(5) , for compliance on 27.09.2017. The assessee's counsel appeared before ld. CIT(E) and filed part replies. The ld. Counsel for the assessee sought adjournment, which was granted by ld. CIT(E) , and ....

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....le and commercial activities for generating huge profits. The ld. CIT(E) also observed that no corroborating evidences in the form of photographs/newspaper clippings or other corroborating evidences are brought on record to prove genuineness of its activities. The ld. CIT(E) also observed that the assessee has paid Rent of Rs. 10,000/- for financial year 2015-16 and 2016-17, but no details/lease deed/rent agreement were submitted by assessee, which raises serious concerns about misuse of funds of the assessee for the benefit of persons referred to in Section 13(3) of the 1961 Act. Thus, in nut-shell the ld. CIT(E) held that the assessee failed to prove that it is undertaking its educational activities for charitable purposes , rather it is running its educational activities on commercial grounds, and also that the assessee has not worked towards the performance of objects set out in its Memorandum. Thus, the ld. CIT(E) rejected the application filed by the assessee for grant of registration /approval u/s 80G(5) of the 1961 Act. Aggrieved, the assessee has filed an appeal with tribunal. The ld. Counsel for the assessee has elaborately and vehemently stated before the Bench that prop....

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....el for the assessee also submitted that the salaries are paid to teachers/staff working with the assessee, which can be verified . The assessee has also filed paper book containing 49 pages (placed on record in file), also containing written submissions. The ld. Counsel for the assessee relied upon the judgment and order of Hon'ble Supreme Court in the case of Queen's Educational Society v. CIT, reported in (2015) 372 ITR 699(SC). The ld. Counsel for the assessee prayed that since there are factual errors in the order passed by ld. CIT(E), the matter may be restored back to the file of ld. CIT(E) for denovo consideration of the assessee's application for grant of registration/approval u/s 80G(5), so that the assessee can produce books of accounts, vouchers and other evidence to substantiate its contentions, and if required these books of accounts, vouchers and evidences can be verified by ld. CIT(E).The ld. CIT-DR has also fairly submitted that the matter can go back to the file of ld.CIT(E) for fresh consideration of application of the assessee for registration/approval u/s 80G(5) of the 1961 Act. Keeping in view the totality of the facts and circumstances of the case as enumerate....