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2019 (5) TMI 618 - AT - Income TaxExemption u/s.11 - deemed registration u/s 12AA - applicability of Proviso to Section 12A sub-section (2) during appeal proceedings or restricted to assessment proceedings - registration granted to the assessee u/s.12AA during the pendency of proceedings before the ld. CIT(A) - HELD THAT:- What AO can do, can be done by CIT(A) in an appeal before him. Even what the AO could have done but failed to do, can also be done by him. It shows that the powers of a CIT(A) in an appeal against an assessment order are almost similar to those of an AO. If extend this analogy to the provisions of section 12A(2), an irresistible conclusion which follows is that the benefit of the proviso is available not only when the assessment proceedings are pending before the AO but also when an appeal against the assessment order is pending before the ld. CIT(A). It is so for the reason that the appeal proceedings are nothing but continuation of the assessment proceedings. As at the time of granting registration by the ld. CIT (Exemptions) to the assessee, the appeal of the assessee was pending before the ld. CIT(A), in my considered opinion, the benefit of first proviso to section 12A(2) ought to have been granted. My view is fortified by the judgment of Hon’ble Rajasthan High Court in CIT (Exemptions) Vs. Shree Shyam Mandir Committee [2017 (10) TMI 1450 - RAJASTHAN HIGH COURT] in which it has been held that “ An assessment proceedings which is pending in appeal before the appellate authority should be deemed to be “assessment proceedings pending before the AO.” within the meaning of the term as envisaged under the proviso. It follows there from that the assessee which obtained registration u/s.12AA of the Act during the pending of appeal was entitled for exemption claimed u/s.11. The additional ground thus raised is allowed by holding that the assessee would be entitled to exemption u/ss. 11 and 12 of the Act for the year under consideration on the reason that the registration was, in fact, granted to the assessee u/s.12AA during the pendency of proceedings before the ld. CIT(A). In the light of my above conclusion on the additional ground, the impugned order is set-aside and the matter is restored to the file of AO for framing a de novo assessment as per law after allowing a reasonable opportunity of hearing to the assessee. Needless to say, the assessee in such assessment proceedings would be considered to have been granted registration and the provisions of sections 11 and 12 shall apply pro tanto. Appeal is allowed for statistical purposes.
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