Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2020 (12) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2020 (12) TMI 76 - AT - Income TaxValidity of reopening of assessment - non-registration of trust - HELD THAT:- In the instant case, the registration u/s 12A of the Act was granted to the assessee on 23-09-2014. As per the first proviso, where the registration has been granted to the trust u/s 12AA, then the provisions of sec.11 and 12 shall apply in respect of any income derived from properly held under trust of any assessment year preceding year of granting registration and which are pending before the AO as on the date of such registration and the objects and activities of such trust remain the same for such preceding assessment year. As per the second proviso, no action u/s 147 shall be taken by the AO for any assessment year preceding the aforesaid assessment year only for non-registration of such trust. It can be noticed that the second proviso to sec.12A(2) specifically bars the AO from taking action u/s 147 of the Act only for the reason of non-registration of such trust or institution for the said assessment year. However, in the instant case, the AO has reopened the assessment only for the reason of non-registration the assessee u/s 12A of the Act and consequently to tax the surplus earned by the assessee during the years under consideration. AO has not properly understood the binding circular issued by CBDT, which clearly explains the meaning of provisos inserted in sec.12A(2) of the Act. Accordingly these provisos shall have retrospective operation. Thus reasons recorded by the AO that the assessing officer has reopened the assessments of the years under consideration only for the reason that the assessee does not have registration for the years under consideration, even though the assessee had been granted registration from AY 2014-15 and further the registration certificate was in operation at the time the notices u/s 148 were issued. Accordingly, we are of the view that the action of the AO is in violation of the second proviso to sec.12A(2) of the Act. - Decided in favour of assessee.
|