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2018 (7) TMI 2125 - AT - Income TaxExemption u/s 11 - benefit of grant of registration u/s. 12AA - whether insertion of 1st proviso to sub-section (2) of section 12A which was inserted by Finance Act, 2014 w.e.f. 01.10.2014 is retrospective or not, when the fact remains that the assessment order was passed on 28.03.2014? - HELD THAT:- Assessee has also been accorded approval u/s. 10(23)(c)(iv) by order of Ld. CCIT-3, Kolkata dated 09.01.2014. It is well settled that the CIT(A) has co-terminus power as enjoyed by the AO while deciding the appeal against an assessment order. Even though the assessment order has been passed on 28.03.2014, for the ends of justice and fair play and taking into consideration the fact that the assessee is basically a consortium of State Govt., Central Govt and Municipal Corporation which was incorporated as a company u/s. 25 of the Companies Act, 1956 with the purpose to promote the objectives of the nature specified in section 25(1), clause (a) of the State Act and it is pertinent to note that that it will apply its profit if any or other income in promoting its objects and it prohibits the payment of any dividend to its members. CIT(A) has rightly noted that the assessee’s activities are for charitable purposes. Therefore, we do not find any infirmity in the order of the CIT(A) in this regard and we dismiss the appeal of the revenue. We find that the CIT(A) has rightly held that the benefit of grant of registration u/s. 12AA of the Act also need to be extended to AY 2011-12 and, therefore, we confirm the order of Ld. CIT(A) on this issue. Disallowance of expenditure made on account of amortized lease rent payment and disallowance made on account of depreciation on leasehold land - HELD THAT:- Since we upheld the direction of the Ld. CIT(A) to extent the benefit of grant of registration u/s 12AA of the Act to this AY 2011-12 and, therefore, the assessee is eligible to claim exemption of its income u/s. 11 of the Act. The expenditure incurred by the assessee would be treated as application of income for charitable objects, as the incurrence of expenditure for charitable objects has not been disputed by the revenue. Therefore, we do not find any merit in these grounds of appeal and so stand dismissed. Appeal of revenue is dismissed.
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