TaxTMI 
TaxTMI 
2024 (7) TMI 1125
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....xemption), Bhopal erred in treating the violation of GST Law, Non-payment of TDS, Non-provisioning of interest on bank loan and delay payment of PF/ESIC as material violation to the object of the appellant society. 4. The appellant craves to add, alter or delete any of the grounds of appeal during the course of appellate proceedings." ITANo.164/Ind/2023 "1. That on the facts and in the circumstances of the case and 0 in law, the order dated 7/3 / 2023 passed u/s 80G(5)(ix) of the Act by ld. CIT(Exemption), Bhopal is illegal and void-ab-initio. 2. That on the facts and in the circumstances of the case and in law, the CIT(E) erred in rejecting application of the appellant for registration u/s 80G(5)(ix) of the Act. 3. That on the facts and in the circumstances of the case and in law, the Id. CIT(Exemption), Bhopal erred in treating the violation of GST Law, Non-payment of TDS, Non-provisioning of interest on bank loan and delay payment of PF/ESIC as material violation to the object of the appellant society. 4. The appellant craves to add, alter or delete any of the grounds of appeal during the course of appellate proceedings." 2. First we take up the appeal filed against....
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....relating the activities of the assesse society but this can at the most lead to the disallowance of expenditure or deferment of the claim of expenditure. He has pointed out that there is no outstanding of PF and ESIC for the financial years 2020- 21 & 2021-22 onwards but only for one year i.e. F.Y.2019-20 there was outstanding of PF & ESIC. Therefore, this cannot be a ground for rejection of application for registration u/s 12AB of the Act. Ld. Sr. counsel then submitted that the assessee society is exempt from GST registration as per the Notification no.12/2017 Central Tax (Rate ) dated 28.07.2017. Therefore, the assesse was not required to pay the GST. 3.2 As regards the provision for retirement benefit of the employees as per AS-15, Ld. Sr. counsel has submitted that the CIT(E) has considered the notes of auditor wherein the auditor has remarks that the assesse has not made the provisions for retiral benefits as per AS-15. However, that does not amount to violation of any law governing the assessee and its charitable activities. He has pointed out that there is no requirement as per the provisions of Income Tax Act or any other Act that assessee should maintain its account as p....
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..../2019. 3. Bai Navajbai Tata Zoroastrian Girls School versus CIT (Exemption), Mumbai ITA/2177/Mum/2021 4. Ananda Social & Educational Trust versus Commissioner of Income Tax [2020] 114 taxmann.com 693 (SC) 5. CIT versus Red Rose School [2007] 163 Taxman 19 (Allahabad) 6. Commissioner of Income-tax (Exemptions), UP versus Reham Foundation LKO [2019] 111 taxmann.com 379 (Allahabad) 7. Commissioner of Income-tax, (Exemption) v. Association of Third Party Administrators [2020] 114 taxmann.com 534 (Delhi) 8. Chamber of Indian Charitable Trusts v. PCIT Mumbai I.T.A. Nos. 2168 & 2169/Mum/2021." 4. On the other hand, Ld. DR has submitted that the Ld. CIT(E) has clearly pointed out various instances of non-compliance on the part of the assessee of law and therefore, there is a violation/non-compliance of other law as per sub-clause (i)(B) to section 12AB(1)(b). He has referred to para 4 to 7 of the impugned order and submitted that Ld. CIT(E) has clearly pointed out various violations on the part of the assessee and supported its finding by various decisions. He has relied upon the impugned order of the CIT(E). 5. We have considered the rival submissions as well as relevant mat....
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....der dated 14.11.2018 has been set aside by this tribunal vide order dated 18.06.2023 in ITANo. 32 & 60 of 2019 in para 11 to 17 as under: "11. We have thoughtfully considered the submissions and referred to case laws relied upon by the assessee. The assessee's contention has got merit which is further substantiated by the department by granting them registration u/s 12A(1)(ac)((vi) & 80G(5)(iv) of the Income Tax Act on 10.03.2022. In view of the aforesaid observations, we do not see any substance in the contention of the department and therefore, are of the view that once the department itself has accepted that the assessee's activities are genuine, the cause for invoking provisions of section 10AA(3), effecting the cancellation of registration u/s 12A becomes nullified and therefore, considering the explanations and decisions in favour of various donors allegedly involved in the transactions of bogus donations who have granted donations to the assessee trust, we are of the opinion that the order of cancelation by ld. CIT(E) cannot survive, since the registration is granted to the assessee society having no change in its activities, byelaws and objects in a later year. We therefo....
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....see. The submissions of the assessee are duly considered, however, the same were not found acceptable by the department. The ld. CIT(E) has noted various information received from ld. CIT(E), Kolkata as well as from DCIT (Inv.), Units 7(iv), Mumbai, discussed the modus operandi pertaining to bogus donations, reproduced relevant part of the statements recorded u/s 133A of the IT. Act and has concluded that the assessee societie's activities are found to be not genuine, even the donations received and shown in its accounts are nothing but bogus accommodation entries. In light of such irregularities pointed out, the ld. CIT(E) considered that the assessee society is not entitled for approval u/s 10(23C)(vi) of the I.T. Act, 1961 and therefore, the approval granted u/s 10(23C)(vi) by the then ld. CIT(E), Raipur vide dated 22.09.2008 was withdrawn w.e.f 01.04.2010. 15. The ld. AR of the assessee society, at the outset, has submitted and reiterated the facts and submissions made in ITA No. 32/RPR/2019, which has been discussed in that forgoing paras of this order. 16. The ld. CIT-DR also vehemently supported the order of ld. CIT(E) and reiterated their submissions as discussed in ITA....
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.... (A) the genuineness of activities of the trust or institution; and (B) the compliance of such requirements of any other law for the time being in force by the trust or institution as are material for the purpose of achieving its objects; and (ii) after satisfying himself about the objects of the trust or institution and the genuineness of its activities under item (A), and compliance of the requirements under item (B), of sub-clause (i),- (A) pass an order in writing registering the trust or institution for a period of five years; (B) if he is not so satisfied, pass an order in writing rejecting such application and also cancelling its registration after affording a reasonable opportunity of being heard; 5.4 As per clause (b)(i) the CIT(E) while considering the application for registration satisfy himself inter alia the compliance on the part of the applicant of such requirement of any other law for the time being in force as are material for the purpose of achieving its objects. Therefore, while achieving objects the trust should not violate any other law for the time being in force. The said sub-clause is explained in clause (f) of explanation to sub-section(1) of sect....
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....gh there was non-payment of TDS and short deduction of TDS by the assessee on certain payments of interest however, the said deficient payment was made good in the subsequent year and there is no outstanding in the subsequent years. Even otherwise the short deduction of TDS and belated payment of TDS does not amount to non-compliance with the requirement of any other law time being in force which is material for achieve the objects of the assessee. These noncompliance of deduction and payment of TDS are having their own remedies under the income Tax Act and subject matter of assessments. Hence, non-deduction or short deduction of TDS cannot be a ground for refusal of registration. 6. The next ground was non deposit of PF and ESIC for the financial year 2019-20. The assessee has produced the record including ledgers and challans showing the payments of PF and ESIC and therefore, there was no outstanding payment for PF & ESIC for the subsequent years. Further the non-payment/delayed payment to the contribution to PF and ESI has consequential disallowance as per the provisions of income tax Act and are subject matter of assessment. Hence, the belated payments of PF & ESIC cannot be h....