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2019 (9) TMI 1003 - AT - Income TaxAssessment u/s 154 - AO rejected the appellant’s rectification application against the intimation u/s 143(1) denying exemption claimed by the assessee u/s. 11 - whether the AO could have denied the benefit of exemption claimed u/s 11 by the appellant while processing the return of income u/s. 143(1) which otherwise permits the AO to only make the following adjustments to the income returned? - HELD THAT:- Since the facts of the appellant’s case are admittedly analogous to the facts involved in the case of Indian Chamber of Commerce [2014 (12) TMI 256 - ITAT KOLKATA] we hold that no material change took place in the legal position even after the amendment was brought in Section 2(15) by the Finance Act, 2008. We therefore do not find merit in the findings of the CIT(A) that the assessee would not be eligible for exemption u/s 11 because it is primarily set up with the object of promoting trade & commerce. Since we find that the objects and the activities of the appellant were for charitable purpose, then there should be no reason for the Revenue to reject the appellant’s application for registration u/s 12A of the Act and therby deny the benefit of Section 11 which was admittedly granted till AY 2009/10. As regards the AO’s case that the appellant was not eligible for exemption u/s 11 in absence of grant of registration certificate u/s 12A by the Ld. CIT, we find that this issue is dealt by the Hon’ble Allahabad High Court in its judgment in the case of Society for the Promotion of Education, Adventure Sport & Conservation of Environment Vs CIT [2008 (4) TMI 700 - ALLAHABAD HIGH COURT] as held that if the application for registration u/s 12A is not disposed by the Commissioner within six months then the registration will be deemed to have been granted. Also confirmed by SC [2016 (2) TMI 672 - SC] ORDER] We find merit in the ld. AR’s claim that the application dated 28.06.1973 ought to have been disposed by the Commissioner with six months i.e. on or before 28.12.1973 and in its absence the registration was deemed to be granted to the appellant on expiry of the said period of six months. We therefore hold that the order u/s 143(1) denying the benefit of exemption u/s 11 of the Act was contrary to the legal principle laid down by the Hon’ble Supreme Court (supra). Consequently therefore we do not find merit in the orders of the lower authorities upholding the intimation u/s 143(1) and rejecting the appellant’s application for rectification u/s 154 of the Act. For the reasons set out in the foregoing therefore the orders of the lower authorities as well as the adjustments carried out by the AO in the intimation u/s 143(1) are set aside. - Decided in favour of assessee
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