TMI Blog2016 (8) TMI 1532X X X X Extracts X X X X X X X X Extracts X X X X ..... roviso very clearly provides that in case the assessment proceedings were pending and the assessee has been granted registration under section 12A of the Act, then the provisions of sections 11 and 12 of the Act would apply to such income derived from any property under the trust, of any assessment year, for which the assessment proceedings were pending. Applying the said ratio to the facts of the present case, we hold that the assessee is entitled to the aforesaid claim. We find support from the ratios laid down by Kolkata Bench of Tribunal in Sree Sree Ramkrishna Samity Vs. DCIT [ 2015 (11) TMI 119 - ITAT KOLKATA] and Shree Bhanushali Mitra Mandal Trust Vs. ITO [ 2016 (4) TMI 578 - ITAT AHMEDABAD] Departmental Representative for the Revenue on the other hand, has placed reliance on the ratio laid down by Cochin Bench of Tribunal in Al-Madeena Charitable Trust Vs. ACIT [ 1999 (11) TMI 104 - ITAT COCHIN] wherein the said trust was engaged in the business of printing newspaper and it was held that it had not carried out any charitable activities and hence, it was held to be not entitled to the benefit of section 11 of the Act in respect of income as well as its voluntary co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rn of income. 4. Briefly, in the facts of the case, the assessee trust had furnished original return of income on 27.09.2011 declaring taxable income at Nil after claiming exemption under sections 11 and 12 of the Act for its entire income. The case of the assessee was picked up for scrutiny. During the course of assessment proceedings, the assessee was asked to establish its claim of exemption under sections 11 and 12 of the Act. The Assessing Officer noted that the application of the assessee for registration under section 12A of the Act was rejected by the CIT-I, Pune vide order under section 12AA(1)(b)(ii) of the Act, dated 30.04.2013. The assessee was thereafter asked to show cause vide office letter dated 17.10.2013 as to why the exemption claimed under sections 11 and 12 of the Act should not be denied, in the absence of any registration under section 12A of the Act. The assessee was also show caused to explain as to why it should not be assessed as Association of Persons (AOP). The assessee meanwhile furnished revised return declaring total income of ₹ 28,56,705/- and paid taxes to the tune of ₹ 9,50,750/- on 13.06.2013. The Assessing Officer was of the view ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in turn, have been utilized towards purchase of land at Gat No.1155, Keshnan Theur Road, Kolwadi, Haveli, Pune. The plea of the assessee was that the said corpus donation was a permanent fund kept for specific expenditure needed for administration and survival of the organization and was not utilized for attaining of objects of the trust but towards creation of capital asset or property of the trust. The assessee further pointed out that the Legislative intent was for exempting receipts of corpus contribution with specific directions from the definition of income under section 2(24) r.w.s. 11 of the Act . Various contentions were raised by the assessee before the CIT(A). The CIT(A) was of the view that the definition of income under section 2(24) of the Act includes voluntary contributions received by a trust created wholly or partly for charitable or religious purposes or by an institution established wholly or partly for such purposes. He further pointed out that the earlier sub-clauses excluded from the definition of income, voluntary contributions made to a charitable trust with a specific direction that they shall form part of the corpus of the Trust . However, the Direct Tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as on 31.03.2011, therefore, the alternate plea raised by the assessee was rejected by the CIT(A). 6. The assessee is in appeal against the order of CIT(A) before us. 7. The learned Authorized Representative for the assessee after taking us through the factual aspects of the case pointed out that proviso under section 12A(2) of the Act has been inserted w.e.f. 01.10.2014 and in view of the said proviso, the assessee is entitled to claim exemption under sections 11 and 12 of the Act. He further pointed out that the first application for registration under section 12A of the Act was made on 30.10.2012, which was rejected by the Commissioner with an option to make a fresh application for registration under section 12A of the Act. The second application was moved on 12.11.2013. He further pointed out that registration to the assessee trust has been granted by the Tribunal in respect of application dated 12.11.2013 which relates back to the date of filing of the application. The learned Authorized Representative for the assessee pointed out that the assessment proceedings were completed vide order passed under section 143(3) of the Act dated 16.12.2013 and since the assessment pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he facts of the said case were completely different and not applicable. With regard to facts of Al-Madeena Charitable Trust Vs. ACIT (supra), it was also pointed out that the assessee was running newspaper which was not incidental to the activities of trust and hence, denial of exemption under section 11 of the Act. 10. We have heard the rival contentions and perused the record. The assessee is a trust which was set up vide Trust Deed dated 20.10.2010. The assessee trust was registered under the Bombay Public Trust Act, 1950 vide Certificate of Registration dated 01.04.2011. The copy of registration certificate is placed at page 42 of the Paper Book. The copy of Trust Deed is placed at pages 26 to 41 of the Paper Book. The objects of the trust were in the field of education, health and relief of the poor. However, admittedly, the assessee is running an old age home for senior citizens and was providing boarding, lodging, healthcare and recreation. The assessee moved an application in Form 10A on 05.10.2012 for registration under section 12A of the Act. The Commissioner-I, Pune vide order dated 30.04.2013 rejected the said application moved by the assessee vide order under sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce the corpus donations received by it was for a specific purpose, then even despite the registration being not granted under section 12AA of the Act, the said corpus donations were not taxable in its hands. Both before the Assessing Officer and CIT(A), similar plea was raised and the said plea of the assessee was rejected in the absence of any registration being granted under section 12A of the Act. We have already referred to the observations of both the Assessing Officer and CIT(A) in the paras hereinabove. However, now before us, since the assessee has received registration under section 12A of the Act pursuant to the order passed by the Tribunal in assessee s own case on 27.04.2016, which admittedly relates back to the date of filing the application under section 12A of the Act i.e. 12.11.2013, the question is whether the corpus donations received by the assessee in the year under appeal are not to be taxed in the hands of assessee as the same are exempt under sections 11 and 12 of the Act. In this regard, the assessee has placed reliance on the proviso inserted under section 12A(2) of the Act w.e.f. 01.10.2014. The proviso reads as under:- Provided that where registratio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... would make it eligible to claim exemption under sections 11 and 12 of the Act. Merely because, the Commissioner has passed an order under section 12AA(1)(d) of the Act rejecting the application moved for registration which in turn, has been allowed by the Tribunal or the higher forum, it cannot be said that as on date of assessment proceedings, when the Commissioner had already denied registration, it cannot be said that the application for registration has been refused under section 12A of the Act, since the assessee was still to seek the remedy by way of an appeal before the Tribunal or higher forums. 13. The year under appeal is assessment year 2011-12, wherein the order of assessment under section 143(3) of the Act was passed on 16.12.2013 i.e. after the date of filing the application for registration under section 12A of the Act on 12.11.2013. Therefore, on the date when the application for registration was moved under section 12A of the Act, the assessment proceedings relating to instant assessment year were pending. Admittedly, the objects and activities of trust remains the same i.e. running of an old age home and there is no change in that. The question which arises is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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