TaxTMI 
TaxTMI 
2024 (7) TMI 1125
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....he facts and in the circumstances of the case and in law, the ld. 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." 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....
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.... imparting education. Further short deduction of TDS as pointed out in the audit report is also not a violation of any law 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 th....
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.... CIT (Exemption) Lucknow ITA/03/Agr/2021. 2. Shree Guru Govind Singh Educational Trust versus CIT (Exemption) Lucknow ITA 8962/Del/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....
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....ify its finding. 5.2 We will deal with the reasons given by CIT(E) for rejection of application one by one. As regards the cancelation of the registration granted earlier u/s 12AA of the Act. We find that the said cancelation order 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 a....
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....bogus donations. A show cause notice was issued on 03.12.2018 requesting the assessee society to explain as to why the exemption u/s 10(23)(c)(vi) should not be cancelled of the assessee. The written submission dated 06.02.2019 in response to the show cause notice were made by the assessee. 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 ....
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....tion for a period of five years; (b) where the application is made under sub-clause (ii) or sub- clause (iii) or sub-clause (iv) or sub-clause (v) of the said clause,- (i) call for such documents or information from the trust or institution or make such inquiries as he thinks necessary in order to satisfy himself about- (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 him....
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....such requirement of any other law for time being in force. Since the matter of recovery of outstanding loan is still pending for adjudication before DRT therefore, neither it is undisputed violation nor has this default of payment attained finality. Therefore, this ground of rejecting the application has no legs to stand. 5.6 The next objection of the CIT(E) in rejecting application is non- deduction or payment of TDS. Though 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....