TaxTMI 
TaxTMI 
TaxTMI 
2023 (7) TMI 506
X X X X Extracts X X X X
X X X X Extracts X X X X
....A and Section 148 of the Income Tax Act, 1961 along with order dated 29.03.2022 (Annexure P-5) passed under clause (d) of Section 148A of the Act, being without jurisdiction and against the 3rd proviso to Section 12A(2) of the Act. The petitioner-assessee is a society registered under the Registrar of Societies, Punjab, vide certificate dated 21.06.1993. The assessee is running a college exclusively for girls since 1973 and further a school for plus one and plus two for girls students separate from college, which is an integral part of the college as well. Petitioner-assessee is getting substantial aid from the State Government in the shape of reimbursement of staff salary and therefore, prior to assessment year 2016-17, it was entitled to....
X X X X Extracts X X X X
X X X X Extracts X X X X
....eiving the said notice, petitioner uploaded its reply on 22.03.2022 (Annexure P-4) taking a plea that as per 3rd proviso to Section 12A(2) of the Act, there was a bar to take any action under Section 147 for any preceding year, in which the registration was granted. However, the objections given by the petitioner were dismissed vide order dated 29.03.2022 (Annexure P-5). Thereafter, notice under Section 148 of the Act has been issued to the petitioner. Upon notice of the petition, respondents have filed their reply and contested the claim of the petitioner. Reference has been made to the judgment passed by the Allahabad High Court (Lucknow Bench) in Commissioner of Income-Tax (Exemptions) vs. Shiv Kumar Sumitra Devi Smarak Shikshan Sanstha....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... trust. Further reference has been made to a recent judgment passed by the High Court of Karnataka in Commissioner of Income Tax (Exemptions) & another vs. Karnataka State Students Welfare Fund, (2022) 444 ITR 436 (Kar). In that case, the registration to the trust was granted for the assessment year 2014-15. For the financial year 2013-14, the surplus income of earlier years was sought to be taxed by the Assessing Officer without extending the benefit of Sections 11 and 12 of the Act. The only reason for re-opening the assessment was that there was reference of registration under Section 12-A of the Act and by referring to the proviso to Section 12A (2), the CIT (Appeals) held that re-assessment could not be opened under Section 147 of the ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... position if not meant for. This was not the object sought to be achieved by the Legislature. If for one or the other reason, the proceedings in reference to the assessment years 1988-99 remains pending and the application for registration under Section 12AA of the Act, 1961 is filed in the year 2014-15 followed by registration, if the proviso is applied, then the benefit of sections 11 and 12 of the Act, 1961 would be given to the trust or the institution even for the year 1998-99, though the Legislatures have not provided such arrangement or to extend the benefit in such cases. The provision is candid to govern only those cases where the application for registration is submitted followed by registration, to extend the benefit to the asses....
X X X X Extracts X X X X
X X X X Extracts X X X X
....wer of condonation of delay in seeking registration was not available." This circular clearly provides that non application of registration for the period prior to the year of registration can genuinely cost hardship to the charitable organizations. Section 12A lays down certain conditions for applicability of Sections 11 and 12; (2) Where an application has been made on or after the 1st day of June, 2007, the provisions of section 11 and 12 shall apply in relation to the income of such trust or institution from the assessment year immediately following the financial year in which such application is made: Provided that where registration has been granted to the trust or institution under section 12AA, then, the provisions of sections....