Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2021 (1) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2021 (1) TMI 77 - ITAT DELHIRectification u/s 254 - order passed by the Id, CIT(E) u/s. 12AA(3) in bad in law in absence of a proper show cause notice issued to the Applicant for cancellation of registration u/s. 12AA - HELD THAT:- The case of the Revenue as well as one of the main reasoning given by the tribunal in the captioned order was that this material fact was neither disclosed nor brought on record by the assessee at the time of seeking registration. This may have been disclosed in the notes to the account at the time of filing of return post grant of registration, but certainly it was not disclosed at the time of seeking registration that, what was the purpose and objective of acquiring the AGL on a paltry sum of ₹ 50 lakhs to INC. The tribunal has noted that acquisition of shares in such a manner cannot be held to be in furtherance of the objects of the assessee company. One of the conditions put forth by then Ld. DIT(E) at the time of granting registration was that, “if later on it was found that registration has been granted by misrepresentation or suppression of any facts then registration so granted is liable to be cancelled as per the provision of section 12 AA(3)”. This term and condition given in the registration has been reiterated by the CIT (E) in the cancellation order. One of the reasoning given by the Tribunal to uphold the cancellation order was that, assessee had suppressed vital and material facts regarding acquisition of shares of AJL and the purpose for which it was acquired at the time of seeking the registration. Thus, there is no substance in this contention that, merely because later on this fact was mentioned in the notes to the account of the balance-sheet filed subsequently along with the return of income amounts to furnishing of information at the time of registration. Accordingly, such contention raised in miscellaneous application is rejected. Erroneous finding that the applicant did not undertake any activity in furtherance of its object prior to cancellation of registration - The finding of the Tribunal and the conclusion drawn besides other facts and material on record was also based on the binding precedent of the finding and the judgment of the Hon’ble Delhi High Court, which was rendered almost on the same facts wherein there is a clear-cut observation that all these transactions were hidden from the Income Tax Department. In fact this vital fact was also hidden from the DIT(E) while seeking the registration under section 12AA; and not only that, post granting of registration also no such genuine activities was carried out from the period of granting of registration till the period assessee has surrendered for registration. In this regard observation and conclusion of the Tribunal in paragraph 122 is reiterated. Tribunal has noted that it has noted down various arguments placed by the parties as well as judgment relied upon and also dealt with all the core arguments, but same are not being dealt with, because the findings have been reached on the reasoning and the conclusion given in the foregoing paragraphs and the order of CIT (E) cancelling the registration was upheld. In the impugned miscellaneous application no such mistake has been pointed out which can be said to be a mistake apparent from record which can be held to be rectifiable within the scope and ambit of section 254(2). In any case, the assessee had preferred the appeal on the following two grounds only. On the aforesaid grounds the detail reasoning and finding has been given. Nowhere in the miscellaneous application has the assessee pointed out that, either the grounds have not been adjudicated or has been omitted to be considered by the Tribunal. Thus even otherwise the miscellaneous application filed by the assessee does not stand scope and ambit of section 254(2) of the Act. Accordingly, the miscellaneous application filed by the assessee is dismissed
|