Case Law Details
Centre For Management Development Vs CIT (Exemptions) (Kerala High Court)
The petitioner, an autonomous educational institution, sought exemption under Section 10(23C)(VI) of the IT Act but was denied due to delays in submitting audit reports. Despite filing appeals for certain assessment years, the petitioner awaits decisions on applications for condonation of delay under Section 119(2)(b) of the IT Act.
The court directs the CIT (Exemptions) to expedite the disposal of these applications, ensuring a decision is reached within two months. Meanwhile, the petitioner is instructed to file appeals for all relevant assessment years, depositing 20% of the assessed amount and submitting applications for condonation of delay and stay petitions. Recovery proceedings will be suspended until the appeals are resolved.
FULL TEXT OF THE JUDGMENT/ORDER OF KERALA HIGH COURT
The petitioner is a self supporting autonomous educational institution which provides research, consulting and training support to development agencies, corporate sectors and the Government, both at the National and State level. The petitioner is managed by a Governing board comprising of a Chairman, three Senior Secretaries to the Government of Kerala, four Chief Executives of public enterprises, two Academicians in the field of management, two industrialists and two representatives of professional bodies. The Director is the member Secretary to the Board. The petitioner got certificate under Section 12A of the Income Tax Act, 1961 (‘the IT Act’ for short) pursuant to the approval granted by the respondents on 22.01.2020. The petitioner has been claiming exemption under Section 10(23C)(VI) of the IT Act from the payment of income tax on its income.
2. In respect of the assessment years 2018-2019, 2020-2021, 2021-2022 and 2022-2023, the notices under Section 143(1) and r/w Sections 153 of the IT Act were issued to the petitioner. The assessment order got completed with respect of the Assessment Years 2018-2019, 2020-2021, 2021-2022 and 2022-2023 in Ext.P2 series.
3. The petitioner has been denied the exemption as the petitioner did not submit the audit report on time in respect of the afore mentioned assessment years. After the assessment orders have passed, the petitioner moved an application under Section 119(2)(b) of the IT Act before the 1st respondent in Ext.P3 series for condoning the delay in submitting the audit reports belatedly before the assessing authority. However, no decision has been taken in the said application. In the meantime, the petitioner has been issued with demand notices in Ext.P5 series.
4. The learned counsel for the petitioner submits that the petitioner has filed appeals along with the stay petition and condonation of delay applications against the assessment order in respect of assessment years 2021-2022. However, in respect of the other assessment years, the petitioner has not filed the appeals. Learned counsel for the petitioner also submits that the petitioner would file appeal in respect of all the assessment years in question within 15 days from today along with the applications for condoning the delay in filing the appeals and the stay petitions.
5. Learned counsel for the petitioner further submits that till the decision is taken on the application for condoning the delay by the 1st respondent under Section 119(2)(b), the recovery proceedings may directed to be kept in abeyance.
6. This court does not find much substance in the submissions of the learned counsel for the petitioner. The fact remains is that as of today, the petitioner has suffered the assessment orders and an appeal has been filed only in respect of one assessment year along with stay petition. The other assessment orders are not under challenge till the date in respect of the other assessment years as mentioned above.
7. This court cannot presume the outcome of the application filed before the 1st respondent for condoning the delay in submitting the audit report under Section 119(2)(b). In view thereof, the present writ petition is disposed of, with direction to the 1st respondent to consider and pass appropriate order on Ext.P3 series applications seeking condonation of delay in filing the audit reports under Section 119(2)(b) of the IT Act, expeditiously and preferably within a period of two months in accordance with law.
8.The petitioner may file appeals in respect of other assessment years along with the applications for condoning the delay as well as the stay petitions. If the petitioner deposits 20 % of the assessed amount in respect of all the assessment years and files the appeals in respect of other assessment years for which the petitioner has not filed the appeals, along with the application for condoning of delay and stay petition, the further recovery of the assessed amount shall be kept in abeyance till disposal of the appeals .
In the result, the present writ petition is disposed of, with the aforesaid directions and liberty.
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