TMI Blog2020 (12) TMI 737X X X X Extracts X X X X X X X X Extracts X X X X ..... has been granted only after the deed of trust was amended, the assessee cannot contend that they are to be granted benefit from the Assessment Year 2013-14. - T.C.A.No.1015 of 2019 - - - Dated:- 9-12-2020 - Honourable Mr. Justice T.S. Sivagnanam And Honourable Mrs. Justice V. Bhavani Subbaroyan For the Appellant : Mr.G.Baskar For the Respondent : Mr.J.Narayanasamy Senior Standing counsel JUDGMENT T.S.SIVAGNANAM , J. This appeal filed by the assessee under Section 260A of the Income Tax Act, 1961 ('the Act' for brevity), is directed against the order dated 30.08.2019 passed by the Income Tax Appellate Tribunal, 'B' Bench, Chennai ('the Tribunal' for brevity) in I.T.A.No.1844/CHNY/2017 for the Assessment Year 2013-14. The appeal was admitted on 10.12.2019 on the following Substantial Questions of Law: 1. Whether on the facts and in the circumstances of the case, the Income Tax Appellate Tribunal is right in law in holding that case of the appellant would not fall within 1st proviso to Section 12A(2) of the Income Tax Act, 1961? 2. When the Appellant having been granted exemption u/s 12A of Income Tax Act, 1961, with eff ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in spite of complying and satisfying with all the provisions and preconditions for availing the benefit under Sections 11 12 of the Act. In support of his contentions, the learned counsel placed reliance on the decision in the case of Commissioner of Income Tax (Exemptions) Vs. Shree Shyam Mandir Committee, reported in (2018) 400 ITR 0466 (Raj) and the decision in the case of Mathew M.Thomas Vs. Commissioner of Income Tax, reported in (1999) 236 ITR 691(SC) . 5. Per contra, Mr.J.Narayanasamy, learned Senior Standing counsel appearing for the respondent submitted that the appeal filed by the assessee before the CIT(A) was not against an order of assessment, but against the order passed on an application for rectification filed under Section 154 of the Act and therefore, it cannot be construed that the assessment was pending in appeal before the CIT(A). Further, it is submitted that the facts of the case were rightly taken note of by the Tribunal and rejected the claim of the assessee for exemption from the Assessment Year 2013-14. Further, it is submitted that exemption provision has to be strictly interpreted and that to in favour of the Revenue and the benefit now sou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r, since no Substantial Question of Law has been framed to that said effect, we do not wish to express any opinion on the said issue and the question is left open. 8. So far as the decisions cited by the learned counsel for the appellant, we find that the factual position in the case of Shree Shyam Mandir Committee (cited supra) was entirely different as could be seen from paragraph 6.4 of the said judgment as the issue was whether a re-assessment proceedings would also be construed as a pending assessment proceedings and in the background of those facts, the Court took note of the Circular issued by the CBDT and granted relief. The decision of the Hon'ble Supreme Court in the case of Mathew M.Thomas (cited supra) was entirely a different issue pertaining to a case arising under Section 269C, read with Section 269-I of the Act, pertaining to acquisition of immovable properties and initiation of proceedings. 9. Therefore, we find both the decisions cannot be applied to the assessee's case. The decision in the case of Shiv Kumar Sumitra Devi Smarak Shikshan Sansthan (cited supra), in our opinion, would be applicable to the case on hand. The Substantial Quest ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rust or the Institution under Section 12 AA of the Act, 1961, then provisions of Section 11 12 of the Act, 1961 shall apply in respect of any income derived from the property held under the Trust or the institution for any assessment year proceeding, for which assessment is pending before the Assessing Authority as on the date of registration. The Tribunal has given interpretation to the proviso to hold that irrespective of the date of application, the benefit of Section 11 12 of the Act, 1961 would be available to the assessee retrospectively, if the assessment proceedings were pending and pendency of such proceedings may be not only before the Assessing Office, but even before the Tribunal. 15. According to us, the interpretation of the proviso has been given in ignorance of the main provision of Section 12A(2) of the Act, 1961. Whenever interpretation of the statutes has to be given it should be after making harmonious construction of the statute. For the purpose of proper interpretation of Section 12A of the Act, 1961, the Tribunal was required to make interpretation after taking into consideration the main provision along with the proviso and not by giving meaning ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not by making main provision of section 12 A as redundant. In the instant case, the application for registration was then submitted on 15.12.2014. The registration was given on 08.06.2015. Since registration has been given on 08.06.2015, the benefit of Section 11 12 would be available for the following financial year in which application was made if the assessment proceedings for the relevant assessment year was pending till the date of registration. It cannot be for the assessment year 2011-12 due to pendency of the appeal before the Tribunal. If the benefit of Section 11 and 12 is extended for the assessment year 2011-12, despite submission of the application for registration on 15.12.2014, it would be in contravention of sub-section 2 of Section 12. By virtue of the interpretation taken by the Tribunal the main provision has been made redundant on the facts of the case, though not permissible. The proviso has to be read along with main proviso and not in isolation and contradiction. 19. The Tribunal even ignored the fact that proviso not only require registration of the Trust or the Institution while the assessment proceedings are pending, but it refers to assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this case, otherwise an anomalous situation may emerge in a given case where for one or the other reason assessment proceedings before the Tribunal remain pending for years together or on a remand or for any other reason it comes before the Assessing Officer and such cases also subsequent application for registration and acceptance would result to extend benefit of Section 11 and 12 creating anomalous position if not meant for. This was not the object sought to be achieved by the legislature. If for one or the other reason, the proceedings in reference to the assessment years 1998-99 remains pending and the application for registration under Section 12AA of the Act, 1961 is filed in the year 2014-15 followed by registration, if the proviso is applied, then benefit of Section 11 and 12 of the Act, 1961 would be given to the Trust or the Institution even for the year 1998- 99, though the legislatures have not provided such arrangement or to extend the benefit in such cases. The provision is candid to govern only those cases where the application for registration is submitted followed by registration, to extend the benefit to the assessee from the following financial year o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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