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2021 (9) TMI 306 - HC - Income TaxExemption u/s 11 - Proof of charitable object u/s 2(15) - Rule of Consistency - denial of exemption on the ground that conducting lectures, workshops, seminars and earning rental income from multi-storeyed building and running of hostel are commercial in nature - whether Tribunal was right in holding that the appellant society is not entitled to exemption under Section 11 in the light of the amendment made to Section 2(15) with effect from 01.04.2009? - HELD THAT:- On account of the fact that the assessee had succeeded before the CIT (Appeals) for assessment year 2010-11 and the said order having become final, applying the Rule of Consistency the revenue cannot take a different stand for the assessment year under consideration, AY 2011-12. Nevertheless there are decisions wherein it has been held that though the cardinal principle is that each assessment year is a distinct and separate unit, nevertheless if the facts and the nature of activities done by the assessee and the nature of claim made by the assessee are identical for the earlier assessment years. Unless there are strong and compelling reasons to take a different view, the revenue should be bound by the decisions in the earlier as well as the subsequent assessment years so far as the said assessee is concerned. This in other words terms as the Rule of Consistency. In the instant case, for the assessment year 2010-2011, the Assessing Officer took a similar view as that of the view taken by the Assessing Officer for the assessment year under consideration AY 2011-2012. Against such decision, the assessee filed appeal before the CIT(A)-VII, Chennai. The CIT(A) after elaborately considering the factual matrix allowed the appeal filed by the assessee. In the said decision, the CIT(A) has examined the very same rental receipts received by the appellant/assessee and granted relief to the appellant/assessee. Aggrieved by the same, the revenue preferred an appeal before the Tribunal and the appeal was withdrawn by the revenue Tribunal has recorded the application filed by the revenue seeking leave to withdraw the appeal and nowhere in the said application it has been mentioned that the appeal has not been pursued on the ground of low tax effect. Rather the application states that no appeal to the Appellate Tribunal is necessary against the order of the CIT(A) dated 19.02.2014. If such was the factual position, the Assessing Officer on the date when he completed the assessment on 31.03.2014 the order passed by the CITA() in the assessee's own case for the earlier assessment year dated 19.02.2014 was available and on record. Assessing Officer was bound by the said order because the said order has not been reversed or modified on the date when the assessment order for the current assessment year 2011-2012 was passed i.e. on 31.03.2014. Therefore, the Assessing Officer ignored the cardinal principle of judicial discipline in not adhering to the orders passed by the Appellate Authority. Thus, for all the above reasons we find that the Tribunal ought not to have reversed the order passed by the CIT(A). Tax case appeal is allowed, the order passed by the Tribunal is set aside and the order passed by the CIT(A) restored. - Decided in favour of assessee.
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