TMI Blog2011 (12) TMI 634X X X X Extracts X X X X X X X X Extracts X X X X ..... any case, renewal of exemption under section 80G(5)(vi) cannot be denied. Accordingly, we direct the DIT(Exemption), Kolkata to allow the exemption and this issue of appeal of the assessee is allowed. - I.T.A No. 2019/Kol/2010 - - - Dated:- 12-12-2011 - C. D. Rao (Accountant Member) And Mahavir Singh (Judicial Member) For the Appellant : J. M. Thard, A.R. For the Respondent : M. Bhattacharya, D.R. ORDER Mahavir Singh (Judicial Member) This appeal by assessee is arising out of the order of ld. Director of Income-Tax (Exemption), Kolkata vide order No.DIT(E)/8E/247/03-04/2621-23 dated 24.09.2010, vide which he rejected the renewal application filed in Form No. 10G for claiming deduction under section 80G(5)(vi) of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... years, not exceeding five assessment years, as may be specified in the approval . Further, considering the hardship of the said proviso, legislature omitted this proviso by the Finance (No.2) Act, 2009 w.e.f. 01.10.2009, but in this case, approval was granted upto 31.03.2010. Therefore, in view of the aforesaid omission of the said proviso, the exemption granted to assessee upto 31.03.2010 continued to be valid thereafter. This position has been explained by the CBDT Circular No. 5 explaining the provisions of Finance (No. 2) Act, 2009 in para 29.7 of the Circular, which reads as under :- This amendment has been made applicable with effect from 1st October, 2009. Accordingly, existing approvals expiring on or after 1st October, 2009 wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... use (vi) to sub-section (5) of section 80G, the approval was to be granted by the ld. Commissioner of Income Tax in accordance with Rules prescribed in Rule I2AA of the Income-tax Rule, 1962 and as per the proviso to section 80G(5)(vi) of the Act, the approval was to be renewed from time to time. However, considering the hardship, the Legislature in all its wisdom has sought to omit this proviso on 1.10.2009 vide its Finance (No.2) Act, 2009. Therefore now approval once granted shall continue to be valid in perpetuity. In the instant case, the approval was granted to the assessee upto 31.3.2010, therefore, in view of the aforesaid omission of the proviso to section 80G(5)(vi) of the Act vide Finance (No.2) Act, 2009, the approval once grant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itution or fund are not genuine or are not being carried out in accordance with the objects of the institution or fund. This amendment will take effect from 1st day of October, 2009. Accordingly, existing approvals expiring on or after 1st October, 2009 shall be deemed to have been extended in perpetuity unless specifically withdrawn. However, in case of approvals expiring before 1st October, 2009, these will have to be renewed and once renewed these shall continue to be valid in perpetuity, unless specifically withdrawn . 11. From the above it is crystal clear that the approval once granted u/s. 80G(5)(vi) of the Act shall continue in perpetuity. It is also noticed that the CBDT issued its circular No.5 being Explanatory circul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... raw such approval at any time. Provided that the Central Government or Board or income-tax authority shall, after giving a reasonable opportunity of showing cause against the proposed withdrawal to the assessee concerned, at anytime, withdraw the approval after recording the reasons for doing so.] 13. From the proviso attached to the section 293C of the Act, it is crystal clear that even if any Income-tax Authority wants to withdraw approval, he shall issue a show cause notice against the proposed withdrawal to the assessee concerned and after giving a reasonable opportunity of being heard shall withdraw approval after recording reasons for doing so. The use of the word shall in the aforesaid proviso makes it mandatory for Comm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ption upto 31.03.2010, because of ignorance of the A/R of assessee, a mistaken application for renewal of exemption was filed, the same should not have been rejected for violation of the provisions of section 11(1)(a). In case, there is a violation of the provisions of section 11(1)(a), the relevant additions could have been made by the Assessing Officer in the hands of the Trust disallowing the exemption to the assessee accordingly. But in any case, renewal of exemption under section 80G(5)(vi) cannot be denied. Accordingly, we direct the DIT(Exemption), Kolkata to allow the exemption and this issue of appeal of the assessee is allowed. 5. In the result, the appeal filed by the assessee is allowed. Order Pronounced in the open Court ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
