TMI Blog2018 (4) TMI 249X X X X Extracts X X X X X X X X Extracts X X X X ..... grant of registration subsequently, and complete the assessment in accordance with the law. This aspect; the provisions of section 11 & 12 being not applicable in the absence of registration, remain to be examined. - I.T.A. No. 644/(Asr)/2013, I.T.A. No. 592/(Asr)/2015 And I.T.A. No. 586/(Asr)/2016 - - - Dated:- 27-3-2018 - SH. SANJAY ARORA, ACCOUNTANT MEMBER AND SH. N. K. CHOUDHRY, JUDICIAL MEMBER For The Appellant : Sh. Jaswinder Singh (Adv.) For The Respondent : Sh. Sandeep Chauhan (D.R.) ORDER Per Bench: This is a set of two Appeals by the Assessee in quantum proceedings, i.e., for Assessment Years (AYs.) 2009-10 2010-11, and one appeal by the Revenue in penalty proceedings (for AY 2010-11). The appeals raising common issues, were heard together, and are accordingly being disposed per a common, consolidated order. Quantum Proceedings : 2. The assessee, a public trust running educational institutions, stands denied exemption u/s. 11 on it s income for the relevant years for want of registration u/s. 12AA, i.e., in view of section 12A(1), which reads as under, providing for such registration as a condition precedent for the applicatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sections 11 and 12. 12A. (1) (2) Where an application has been made on or after the 1st day of June, 2007, the provisions of sections 11 and 12 shall apply in relation to the income of such trust or institution from the assessment year immediately following the financial year in which such application is made: Provided that where registration has been granted to the trust or institution under section 12AA, then, the provisions of sections 11 and 12 shall apply in respect of any income derived from property held under trust of any assessment year preceding the aforesaid assessment year, for which assessment proceedings are pending before the Assessing Officer as on the date of such registration and the objects and activities of such trust or institution remain the same for such preceding assessment year: Provided further that no action under section 147 shall be taken by the Assessing Officer in case of such trust or institution for any assessment year preceding the aforesaid assessment year only for non-registration of such trust or institution for the said assessment year: Provided also that provisions contained in the first and second proviso shall not ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bunal or a higher appellate forum, however, stands adduced before us. 3. We have heard the parties, and perused the material on record. We, in principle, could not agree more with the stand of the Revenue. Even if, for argument sake, an assessment in appeal is regarded as a continuation of the assessment proceedings, it is not pending before the Assessing Officer but before an appellate authority, be it the first or the second appellate authority, extending right up to the Apex Court; the constitutional courts also exercising appellate jurisdiction over an assessment under the Act. An assessment in appeal cannot therefore be regarded as pending before the Assessing Officer (AO). The moot question, however, is as to why has the Legislature restricted the retrospective application of the registration only to the year for which the assessment proceedings are pending, as on the date of grant of registration, before the AO? The answer is simple. It is the AO who has to examine if the conditions of section 11 (providing an exemption on the application of the income by a charitable or religious trust for its object/s) are satisfied and, accordingly, issue appropriate findings fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessing Officer is precluded from initiating reassessment proceedings on the basis of non grant of registration (u/s. 12AA). As we understand, the whole purport of the provisos to s. 12A(2) is to mitigate the hardship, as far as possible, arising to an assessee, a charitable (or religious) trust or institution, on account of the delayed grant of registration u/s. 12AA, which is thus deemed as applicable even for prior years. This, as apparent from a reading of s. 12A, follows the withdrawal of the power of condonation of the delay in applying for the said registration, erstwhile vested with the competent authority w.e.f. 01.06.2007 (by insertion of the second proviso to section 12A(1)(a)). Clearly, therefore, there should be no other impediment - apart from non-registration, for the non allowance of the exemption u/s. 11 and, as a corollary, no change in the objects and activities of the trust/institution during the intervening period - a condition provided by the statute itself. Why, even in case of other impediments, where removed/deleted in appellate proceedings, so that only that qua registration obtains, the relevant assessment could similarly qualify for being considere ..... X X X X Extracts X X X X X X X X Extracts X X X X
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