TMI Blog2008 (4) TMI 700X X X X Extracts X X X X X X X X Extracts X X X X ..... ss any order either allowing or rejecting the registration. It is obvious that the application cannot be allowed to be treated as perpetually undecided. In the present case, we find that there is no such public element or public interest. Taking the view that non-consideration of the registration application within the time fixed by section 12AA(2) would result in deemed registration, may at the worst cause loss of some revenue or income-tax payable by that individual assessee. This would be similar to a situation where the Assessing Authority fails to make the assessment or reassessment within the limitation prescribed for the same. That also leads occasionally to loss of revenue from that individual assessee. On the other hand, taking the contrary view and holding that not taking a decision within the time fixed by section 12AA(2) is of no consequence would leave the assessee totally at the mercy of the Income-tax Authorities, inasmuch as the assessee has not been provided any remedy under the Act against non-decision. In our view for the interpretation of a statute purposive construction of the enactment which gives effect to the legislative purpose/intendment, if nec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shish Bansal For the Respondent : A. N. Mahajan and Bharat Ji Agrawal, Central Government Standing Counsel JUDGMENT 1. Counter and rejoinder affidavits have been exchanged. We have heard both sides. 2. The petitioner is a Society running a school. The petitioner claims that because up to the assessment year 1998-99, it was exempted under Section 10(22) of the Income Tax Act, 1961, (hereinafter referred to as the Act for short), therefore it did not seek separate registration under Section 12A of the Act, so as to claim exemption under Section 11. 3. Section 10(22) being omitted by the Finance Act, 1998, the petitioner applied for registration under Section 12A of the Act, with retrospective effect, that is since the inception of the petitioner-society i.e. 11.1.1993. An application for the purpose was duly made on 24.6.2003. Inasmuch as, under Section 12A(a) (as it stood at the time of making the application), the application was required to be made within one year from the date of creation of establishment of the Trust or Institution, therefore, condonation of delay was sought in terms of Section 12A(a) proviso (i). 4. Section 12AA(2) reads as follows: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ause not following the same could lead to a chaotic situation. Similar view has been expressed by the Bombay High Court in the case of Bank of Baroda v. H.C. Srivastava [2002]256ITR385(Bom) . 8. It is not in dispute that the Commissioner is required to give opportunity to the applicant before refusing registration and that reasons have to be given by the Commissioner in his order (see CBDT Circular No. 762 dated 18-02-1998). Based on that hypothesis, it has been argued that absence of any such order of the Commissioner should be taken to mean that he has not found any reason for refusing registration, notice of which could have been given to the assessee by way of opportunity of hearing. For showing the Legislative intent, reliance has also been placed by the Petitioner on the fact that against an order of the Commissioner granting registration the Income Tax Department has not been given any right of appeal. It has been argued that laches and lapse on part of Department cannot be to its own advantage by treating the application for registration as rejected. 9. On the other hand, the standing counsel for the Income Tax Department relies upon a decision of the Supreme Court in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the registration application within the time fixed by Section 12AA(2) would amount to deemed grant of registration, the only adverse consequence likely to flow from such a view in respect of any case of that assessee arising in future would at best be some loss of revenue from that individual assessee from the date of expiry of the limitation under Section 12AA(3) till the date of cancellation of that registration, if such cancellation is called for. 13. Moreover, the view we are inclined to take as above furthers the object and purpose of the aforesaid statutory provision. In our view for the interpretation of a statute 'purposive construction' of the enactment which gives effect to the legislative purpose/intendment, if necessary must be followed and applied. The doctrine of purposive interpretation is well accepted and has been applied in India by the Apex Court following the English Law on the subject. Explaining as to what 'purposive construction' is, Lord Smith in R. (Haw) v. Secretary of State of State for the Home Department (2006) 3 All 428, in paragraph 42, observed A purposive construction of an enactment is one which gives effect to the legislative ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 91 ; Dilip S. Dahanukar v. Kotak Mahindra Co. Ltd. 2007CriLJ2417 . 16. Recently in New India Assurance Company Ltd. v. Nusli Neville Wadia and Anr. AIR2008SC876 , in paragraph 51 of the judgment, the Apex Court referred to Aharon Barak, Purposive Interpretation in Law (2007) at page 87) and quoted the following passage: Hart and Sachs also appear to treat purpose as a subjective concept. I say appear because, although Hart and Sachs claim that the interpreter should imagine himself or herself in the legislator's shoes, they introduce two elements of objectivity: First, the interpreter should assume that the legislature is composed of reasonable people seeking to achieve reasonable goals in a reasonable manner; and second, the interpreter should accept the non-rebuttable presumption that members of the legislative body sought to fulfill their constitutional duties in good faith. This formulation allows the interpreter to inquire not into the subjective intent of the author, but rather the intent the author would have had, had he or she acted reasonably. 17. The Apex Court also referred to and followed its earlier decisions in Bharat Petroleum Corporation Ltd. v. Mad ..... X X X X Extracts X X X X X X X X Extracts X X X X
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