9911796707
TMI Blog2016 (10) TMI 775X X X X Extracts X X X X X X X X Extracts X X X X ..... ace from assessment year 1999- 2000 and section 10(22) of the Act came to be omitted and substituted by section 10(23C)(vi) of the Act. The petitioner- Board was exempted under Section 10(23C)(vi) of the Act for the assesment year 1999-2000 till the assessment year 2002-03. The petitioner-Board has also got registration under section 12AA of the Act w.e.f. 01.04.1999 and by virtue of the later amendment, compulsory filing of return of income was required. Resultantly, the petitioner-Board has started filing return of income for the initial assessment year 2003-04 onwards. In 2003-04, for the first time the return of income came to be submitted by the petitioner and for that period, the exemption was granted after scrutiny assessment under Section 143(3) of the Act and no reopening for that year had taken place. The petitioner-Board has provided information in the petition that for the subsequent year 2004-05 again, the exemption was granted in view of section 11 of the Act and the said exemption was also scrutinized under the assessment executed under Section 143(3) of the Act and the reopening was initiated for that year but later on, upon explanation of the petitioner, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reasons for reopening under a communication dated 27.07.2010 which, later on, came to be provided by the respondent authority on 05.08.2010. After receipt of the said reasons a further objection came to be filed by the petitioner under a letter dated 12.08.2010 which, later on, after consideration came to be rejected by an order dated 29.11.2010. It is against this issuance of notice under section 148 of the Act for A.Y 2005-06 and against the rejection of objection filed by the petitioner with respect to that year the petitioner has brought this petition for challenge. The reason for reopening which came to be supplied by the petitioner reads as under: "It is seen that the institution is registered u/s. 12AA of the Income Tax Act,1961. Registration u/s. 12AA of the IT Act, does not assign and organization or institution the status of a "Trust" because registration can be granted to any institution whose objects are charitable. Therefore, if an institution is registered u/s. 12AA of the IT Act, exemption available to a trust u/s. 11(1)(a) of the Act is not available to an institution. It is further seen that the property of the assessee was not held under a trust as no trust deed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... brief mainly are mentioned in the petition but the specific objects of the trust are referred to here-in-after: "(a) To aid and promote advancement of education in general and of primary, secondary and higher secondary education in particular; (d) to print, publish, stock, distribute and sell or enter into any arrangement for printing, publishing, stocking, distribution and sale of textbooks, approved, sanctioned or assigned by the Government or other appropriate, authority and any other publications which the Board may decide to publish with a view to making the same available at a fair and reasonable price i.e. on no profit no loss basis; (g) to regulate and fix prices of the publications of the Board; (k) to establish and maintain libraries to facilitate research in general and in curricula, syllabi and textbook production in particular." 6. By referring to these objects of the petitioner-Board learned counsel has submitted that the Board, in view of this, was granted exemption in the earlier years. It was contended on the basis of this information that under the scheme of the Income Tax Act the entire assumption of jurisdiction by the respondent to reopen the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the entire reopening process which has been undertaken is based upon misinterpretation of provision contained under section 11(4) of the Act and therefore submitted that the once the authority has examined thoroughly the entire facts of the case, it is not open to reopen the assessment. Learned counsel has drawn the attention to various annexures and record attached to the petition compilation and contended that the issue related to this exemption has been thoroughly gone through in the scrutiny proceedings which had already become final. By referring to this, learned counsel for the petitioner has drawn attention tosome of the queries which have been raised for the year under consideration vide communication dated 17.01.2007 while issuing notice under Section 142(1) read with Section 143(2) of the Act. Learned counsel submitted that in the said communication which is reflected on page-152 of petition compilation, clauses 1, 6, 9, 10, and 20 are related questions for determining the issue in controversy which have been asked to explain. Same are cogently explained and therefore, having examined minutely these details, since the authority has framed scrutiny assessment under Se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under a communication dated 21.12.2010, a show cause notice came to be issued in a situation where the amendment has taken place to section 2(15) by virtue of Finance Act 2008 w.e.f. 01.04.2009 and on that point of time the petitioner was asked why the registration already granted under section 12AA of the Act should not be cancelled. To this, the petitioner has represented and by a specific order dated 06.01.2011 the proceedings with respect to cancellation of registration already came to be dropped. Therefore, by referring to these circumstances prevailing on record counsel has submitted that the issue related to this has already been fully gone into and therefore in absence of any material change, the reopening may not be permitted. Learned counsel further submitted that for this very year as well as for earlier year the initiation of reopening had taken place at the instance of respondents authority but the same can be dropped by way of specific communication dated 30.12.2009 and for that purpose the counsel has drawn the attention of the Court to pages 78, 79 of the petition compilation and thereby contended that the issuance of notice lacked the authority in view of the afor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ropped and thereafter it is noticed that there is no material change in activity of the Board which is also indicative of the fact that whether the reopening in the present form is permissible or not. Learned counsel appears to have rightly submitted that with respect to year under consideration when the scrutiny assessment has taken place the issue related to this exemption has been gone into and only thereafter the assessment proceedings have been finalized and therefore, if any reopening at this stage is permitted, it would tantamount to be based upon a change of opinion which is not permissible. There is no other distinguishable material which may allow the authority to take the different view. 11. In view of the aforesaid set of circumstances referring to some of the decisions cited by the counsel for the petitioner, the Court is required to deal with the same and therefore, the first judgement which has been relied upon by the counsel for the petitioner is taken up for consideration wherein in case of Radhasoami Satsang Saomi Bagh v. Commissioner of Income Tax reported in 193 ITR 321, the Hon'ble Apex Court has propounded that strictly speaking res judicata does not appl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The observations contained in the said decision in paras 29 and 31 are referred to hereinafter: "29. In Radhasoami Satsang Saomi Bagh v. Commissioner of Income Tax, [1992] 193 ITR 321 (SC) this Court did not think it appropriate to allow the reconsideration of an issue for a subsequent assessment year if the same "fundamental aspect" permeates in different assessment years. In arriving at this conclusion, this Court referred to an interesting passage from Hoystead v. Commissioner of Taxation, 1926 AC 155 (PC) wherein it was said: Parties are not permitted to begin fresh litigation because of new views they may entertain of the law of the case, or new versions which they present as to what should be a proper apprehension by the court of the legal result either of the construction of the documents or the weight of certain circumstances. If this were permitted, litigation would have no end, except when legal ingenuity is exhausted. It is a principle of law that this cannot be permitted and there is abundant authority reiterating that principle. Thirdly, the same principle, namely, that of setting to rest rights of litigants, applies to the case where a point, fundamental to the de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the nature of income and which have not been reflected in the accounts. This interpretation of Sub-section (4) of Section 11 is in consonance with the legislative intent as disclosed by the Finance Minister who spoke in Parliament while this provision was under consideration." "Thus, Sub-section (4) was intended to uncover tax evasion by manipulation of the account books. It was not intended to apply to application or expenditure of income by the business undertaking. As already seen, the non-application of income for purposes of the trust was dealt with by Sub-section (3) of Section 11." 14. From the aforesaid situation it appears that in the present proceedings, the exemption issue generated by the authority has already been thoroughly examined and therefore, it would not be proper on the part of the respondent-authority to reopen the said issue and further there is not remote indication that petitioner has not truly and fully disclosed all material facts. 15. Now dealing with the contention of the counsel for the Revenue who has relied upon the decision in case of Ideal Publications Trust (supra) delivered by the High Court of Kerala and submitted that almost in similar ..... X X X X Extracts X X X X X X X X Extracts X X X X
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