TaxTMI 
TaxTMI 
2025 (6) TMI 1639
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....ons is a Public Charitable Trust created by settler Anil Kumar vide trust deed dated 18.02.2010 with the trustees Sh. Irinder Ahluwalia, Natasha Ahluwalia and Kiran Ahluwalia at B- 14, Sarita Vihar, New Delhi. The trust was registered u/s 12A of I.T. Act on 08.04.2011 vide registration No. DIT(E)/12A/2011-12/H-827/15 granted by Director of Income Tax (Exemption), Delhi. It was also registered u/s 80G of I.T. Act on 08.04.2011 vide registration No. DIT(E)/12A/2011-12/H-827/33 granted by Director of Income Tax (Exemption), Delhi. 3. A survey under Section 133A of Act was conducted by Investigation Wing of Income Tax Department at Delhi on 10.09.2021 at the following two premises of the assessee: (i) Plot No. 809, 2nd Floor, Rd-42C, Sector-42, Gurugram (Office premise) (ii) 1325-basement, Sector-43, Gurugram Haryana (Office-cum-Godown premise) 4. Evidences collected during the survey were shared by the Investigation Wing with the Assessing Officer (AO) i.e., DCIT, Central Circle-2, New Delhi as well as Ld. PCIT. From the evidences collected during survey, it is noticed that there have been one or more specified violations during various years. Moreover a refere....
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.... of section 143(2) of the act is void ab initio and bad in law, as no satisfaction note has been prepared by the Ld. AO before making a reference under aforesaid proviso to PCIT Central, Delhi. 4. Without prejudice to the above, the learned PCIT Central, Delhi has erred in acting on a reference made by AO under the second proviso to the provisions of section 143(2) of the act ignoring the fact that, the proviso invoked was introduced by Finance Act 2022 w.e.f. 01.04.2022 and therefore was not applicable for the A. Y 2021-22. 5. Without prejudice to the above, the facts and circumstances of the case the PCIT Central Circle, Delhi has erred in applying the conditions section specified in 12AB (4) along with explanation to sub section (4) with reference to FY 2020-21 whereas the aforesaid sub section (4) has been introduced by Finance Act 2022 and is applicable for FY 2022-23 onwards. 6. That in view of facts and circumstances of the case and in law the PCIT Central, Delhi has failed to poove that the activities of the trust are not genuine or that the activities of the trust are not in consonance with its objects, which is the foremost consideration for can....
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....epresentative for appellant/assessee submitted that orders of registration dated 08.04.2011 under Section 12AA of the Act read with sections 12A and under Section 80G(5)(vi) of the Act were issued by the Director of Income Tax(E), Delhi, copies of orders at pages 462 & 463 of paper books. After amendment, assessee again applied for registration which was granted vide orders dated 24.09.2021 by Ld. PCIT at page no.493 of the paper books. Ld. PCIT (E), Delhi vide order dated 09.11.2021 under Section 127 of the Act transferred the jurisdiction of the assessee from Ward (Exemption)-I (2) to Central Circle-2, New Delhi, for better co-ordination, effective investigation and meaningful assessment. Ld. PCIT vide order dated 28.12.2023 cancelled registration of the assessee under Section 12AB of the Act illegally. A Coordinate Bench of the ITAT, Delhi in ITA No.1308/Del/2023 decided on 08.01.2024 set aside the order of Ld. PCIT being without jurisdiction. Reliance was placed on order of ITAT, Jaipur Bench in case of M/s. Wholesales Cloths Merchants Association Vs. PCIT in ITA No.688/JP/2019. 8. Learned Authorized Representative for appellant/assessee submitted that Ld. PCIT, Central Delh....
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....n transferred to Transferee AO/PCIT-C 1. Therefore, on a conjoint reading of jurisdictional High Court judgement in CIT Vs Sahara India Financial Corp Ltd (2007) 294 ITR 363 (Del) read with Hon'ble Supreme Court in PCIT Vs ABC Papers Ltd (2022) 9 SCC 1, the Order dated 9-11-2021 passed u/s 127 by CIT (E), Delhi transferring the case of Assessee to ACIT-CC2, Delhi; CIT (E) is legally valid and cannot be questioned. A (iii) Once the case is transferred from Transferor AO to Transferee AO, the administrative jurisdiction over the Transferee AO is to be exercised by the Higher Authorities being administratively superior to the Transferee AO. That flows from the mandate of S. 118 and Notification issued by CBDT u/s 118. Consequently, the jurisdiction of PCIT will be exercised by PCIT exercising administrative jurisdiction over Transferee AO and not by the PCIT/CIT exercising administrative jurisdiction over Transferor AO. Notification issued by CBDT u/s 118; attached as S. No 1 /Revenue's Judgement PB 2. B. It is well-settled that if an issue has already been decided by jurisdictional High Court/Supreme Court, in that situation as per doctrine of Precedents [ "....
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....nsferee AO, has not been obtained, is plainly baseless, rather mischievous designed to mislead. Therefore, the ratio of Supreme Court in NOORUL ISLAM EDUCATIONAL TRUST [2016] 388 ITR 489 (SC), relied upon by assessee, is not applicable. D. (i) Another very important reason which distinguishes relied upon case from Impugned Order. In the relied upon case, order u/s 127 was passed transferring the case from Chandigarh to Faridabad ie transfer from one city to another. D (ii) In contra-distinction, in Impugned Order the transfer is from one Delhi AO to another AO based in Delhi ie the Impugned Order deals with intra-city transfer. D (iii) Intra-city transfers are governed by s. 127(3), where even the opportunity of being heard to assessee is not required to be given before effecting the transfer u/s 127. This position has been confirmed by a Constitution Bench of Supreme Court in Kashiram Aggarwala Vs UOI ((1965) 56 ITR 14 (SC). [Attached @ S. No 3 in Revenue's Judgement PB II] D (iv) It is well-settled that non-mentioning of correct section number, or quoting wrong section number in an Order does not invalidate the Order, provided that the powe....
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.... from Memorandum explaining the provisions of Finance Bill 2022 and Finance Act 2022. Therefore, there is no error in Impugned Order to invoke S. 12 AB for AY 2022-23 [FY 2021-22]. (vi) For AY 2021-22 [FY 2020-21], s. 12 AA has been invoked. Revenue has demonstrated during the course of hearings that Hon'ble Supreme Court in CIT Vs Batanagar Education & Research Trust (2021) 9 SCC 439 and in PCIT Vs Singhad Technical Education Society (2025) 472 ITR 18 (SC) has upheld the cancellation of registration u/s 12AA for AYs prior to AY 2022-23. Therefore, there is no error in Impugned Order for cancelling registration of cancellation of assessee-trust for AY 2021-22, on that score Impugned Order deserves to be upheld. 11. From examination of record in the light of aforesaid rival contentions, it is crystal clear that appellant/assessee is a charitable trust was registered under Section 12A and 80G of the Act vide order dated 08.04.2011 by the Director of Income Tax (E). After amendment, assessee applied for registration which was granted vide order dated 28.04.2021 by the Ld. PCIT. A search and seizure operation was conducted on 10.09.2021. Evidence was collected during su....
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....l of evidence impounded during survey in the form of emails reproduced above, it is established that the assessee was mobilizing funds from outside India, in gross violation of FCRA norms, to support farmers' protests. Complying with the objects of the trust is a precondition for claiming the exemption under the Income Tax Act, 1961. Such an action shows that income of the trust is being applied for purposes other than for objects of the trust. The activities being carried out by the trust are not genuine and are not carried out in accordance with the conditions subject to which it was registered. Accordingly, it constitutes "specified violation" as per Explanation 2 to section 12AB(4) of I.T. Act. In view of these facts, it is held that the activities of the trust are not genuine and not being carried out in accordance with the objects of the trust. Hence, the registration granted to the assessee u/s 12A/12AA from FY 2020-21 and u/s 12AB from FY 2021-22 onwards is cancelled. IIIB. As discussed in paras 27 to 37 above, from perusal of evidence impounded during survey in the form of emails reproduced above, it is established that the assessee mobilized funds to support ....
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....price of land. Complying with the objects of the trust is a precondition for claiming the exemption under the Income Tax Act, 1961. Such an action shows that income of the trust is not being entirely recorded in its books of account and cash payments are being made outside books in gross violation of sections 11, 12 and 13 of I.T. Act. Thus, the activities being carried out by the trust are not genuine and are not carried out in accordance with the conditions subject to which it was registered. Accordingly, it constitutes "specified violation" as per Explanation to section 12AB(4) of L.T. Act. In view of these facts, it is held that the activities of the trust are not genuine and not being carried out in accordance with the objects of the trust. Hence, the registration granted to the assessee u/s 12AB from FY 2021-22 onwards is cancelled. VI. As discussed in paras 73 to 78 above, the assessee has received anonymous donations of Rs. 61,79,445/-during F.Y. 2019-20 to 2021-22 which is liable to be added back as anonymous donations u/s 115BBC of the Act. Complying with the objects of the trust is a precondition for claiming the exemption under the Income Tax Act, 1961. These a....
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.... of Section 12AB. The one who could grant or cancel the registration as per amended provisions which is not PCIT, Gurgaon, but, would be CIT(E), Chandigarh. Thus assumption of jurisdiction for cancellation of registration u/s 12AB(4) of the Act by virtue of aforesaid transfer of jurisdiction order u/s 127 of the Act is not conceivable. 17. At the same as we observed above that the assessment by said assessing officer was completed in September, 2021, thus, there was no occasion for concerned AO to invoke 'reference' powers under second proviso to sub-section (3) of section 143 of the Act. It appears that when confronted with the situation that the second proviso of section 143(3) having come into effect from 01.04.2022 is not applicable to the assessment initiated consequent to search and seizure operations u/s 132 of the Act carried out on 19.02.2020, the ld. PCIT, Gurgaon improved his case by claiming that he had exercised his powers by virtue of clause (a) of sub-section (4) of section 12AB, which entitles a Principal Commissioner or Commissioner to take cognizance on the basis of a 'specified violation' coming into his notice during any previous year. At the cost of re....
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.... Section 12AB(4) of the Income Tax Act, 1961. As such, following information from the assessee trust was called for under Section 12AB of the Act vide this office letter dated 08.09.2022 to examine the activities of the Aggarwal Vidya Pracharni Sabha with a view to ascertain whether the same are covered under the clause of explanation to the provisions of Section 12AB(4) of the Act and other provisions of the Act. Details of information called for the relevant period i.e. AY 2014-15 to 2020-21 is as under: Copy of registration u/s 12AA/12AB(1) of the Act. Coy of memorandum of association containing the objects for which the Aggarwal Vidya Pracharni Sabha was set up along with copy of registration with the relevant authorities. Details of capital expenditure and revenue expenditure incurred for various A.Ys. as mentioned above. Copies of Form 10 and Form 10B in respect of funds accumulated u/s 11(1)(a), 11(2) of the Act and year wise utilization of the same. Specify the activities of which the accumulated funds have been utilized. Copy of account of the Aggarwal Vidya Pracharni Sabha with M/s Tirupati Realbuild Pvt. Ltd. And M/s Radhey 30 ITA No. 1308/Del/2023 Krishna Infra....
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.... only for a limited purpose of Co-Ordinate Assessment. Neither any search & Seizure action nor any notice u/s 153A or 153C of the Act or assessment u/s 153A or 153C of the Act in the case of assessee were initiated and there was only a survey u/s 133A of the Act in the case of assessee. The assessment has been completed u/s 148/143(3) of the act vide order dated 19.12.2018. As the assessment has been completed, the purpose of transfer u/s 127A has also been completed. Although No notices regarding the transfer of the cases u/s 127 have been sent to the assessee for the purpose of Co-ordinate assessment and the purpose of transfer was only Co-Ordinate Assessment as clearly mentioned in the transfer letter 19.08.2016. The assessment was completed u/s 148 r.w.s 143(3) 19.12.2018 and the proposal was sent to the Pr. CIT(C ) which has been received on 31.12.2018 in the office of Pr. CIT(C) on 23.01.2019 after a lapse of more than one month. 15. Even otherwise, in the said notification, there is no mention where CIT(E) can transfer to other CIT or Pr.CIT. The said notification of CBDT has authorized the CIT(E) to issue order in writing for the exercise of the powers and function....