Case Law Details
PIME Welfare Society Vs ACIT (ITAT Visakhapatnam)
In the matter abovementioned ITAT remanded matter to AO for adjudicating exemption by taking registration u/s 12 A as it is impossible for assessee to mentioned new registration particular in ITR-7.
Assessee is a Charitable Society registered initially U/s. 12A. Assessee applied for renewal of registration u/s 12AB in pursuant to the amendment brought in Statute with effect from 01/06/2022 where all the Charitable Trusts were supposed to apply for registration U/s. 12AB of the Act even though they were already holding registration. Assessee obtained registration u/s 12AB on 04.04.2022 hence assessee filed ITR-7 by giving old registration number, in view of the last date for filing of the return of income for the AY 2021-22 being 31/03/2022. The CPC denied total exemption by stating that assessee’s renewal details u/s 12AB were not available in ITR-7 as mandate by the amended provisions of section 12AB of the Act w.e.f., 01/06/2022.
On appeal, Addl/JCIT(A)-2, held that mere filing of the return of income with the existing Registration Number does not entitle the assessee to claim exemption U/s. 11 and dismissed the appeal after confirming the disallowance.
Before ITAT, it was submitted that it is impossible for the assessee to mention new registration number in ITR-7 as it was filed on 13.03.2022 and the same was obtained on 04.04.2022 after filing of ITR-7. Extension was time was provided by CBDT upto 30.09.2022 and hence existing registration number was valid for claiming exemption u/s 11 for AY 2021-22 till the communication of new registration number. Reliance was placed on decision taken by the Coordinate Bench of the Tribunal in the case of Shambhu Dayal Modern School vs. ITO (Exemption) in ITA No. 1236/Del/2024 (AY: 2021-22), dated 02/08/2024. On the other hand, revenue didnot contradict the fact that the CBDT by its Circular No. 08/2022, dated 31/03/2022 extended the time for filing the renewal applications till 30.09.2022 and renewal was communicated to the assessee on 04.04.2022.
Finally, ITAT held that view taken by the Coordinate Bench of this Tribunal in the case of Shambhu Dayal Modern School (Supra), is applicable to the facts of the present case. Apart from that, the CBDT was permitting the new applications U/s. 12AB of the Act in all the cases of earlier registered entities upto 30/09/2022 which means that the filing of application by the assessee on 27/03/2022 was well within the time. When the assessee received the communication of renewal on 04/04/2022, it was not possible for the assessee to mention such details in ITR-7 which was filed on 13/03/2022. Law does not require the performance of the impossible act. It was impossible for the assessee to mention the renewal details obtained on 04/04/2022 in ITR-7.
The matter was remanded to file of the AO to complete the assessment by considering the old registration number.
FULL TEXT OF THE ORDER OF ITAT VISAKHAPATNAM
Aggrieved by the order dated 29/03/2024 passed by the Learned Addl/JCIT(A)-2, Noida in the case of PIME Welfare Society (“the assessee”) for the assessment year 2021-22, the assessee preferred this appeal.
2. Briefly stated the facts of the case are that the assessee is a Charitable Society registered initially U/s. 12A of the Income Tax Act, 1961 (“the Act”). Pursuant to the amendment brought in Statute with effect from 01/06/2022, all the Charitable Trusts were supposed to apply for registraon U/s. 12AB of the Act even though they were already holding registraon. For such applicaon of renewal, the Central Board of Direct Taxes (“CBDT”) vide Circular dated 31/03/2022 extended the me ll 30/09/2022.
3. The assessee, however, applied for renewal of registraon U/s. 12AB of the Act (as amended) on 27/03/2022 and obtained the same by 04/04/2022. However, in view of the last date for filing of the return of income for the AY 2021-22 being 31/03/2022, the assessee filed the return of income by giving the old Registraon Number in its ITR-7.
4. The CPC, Bangalore, by way of of Intimation U/s. U/s. 143(1) of the Act, denied the total exemption claimed by the assessee by stating that as per the amended provisions of section 12AB of the Act w.e.f., 01/06/2022, all the entities have to get new registraon approval at their end and since the assessee’s renewal of registraon details were not available in the ITR-7, the exemption claimed by the assessee in No. 4(i) to 4(vii) in the Schedule – Part B-TI of the ITR-7 was not allowed.
5. The learned Add l/JCIT(A)-2, Noida also held that mere filing of the return of income with the existing Registraon Number does not entitle the assessee to claim exemption on U/s. 11 of the Act for the AY: 2021-22 and on that ground the learned Addl/JCIT(A)-2, Noida confirmed the disallowance and dismissed the appeal.
6. The assessee is, therefore, before us in this appeal by stating that the assessee applied for the renewal of the registraon on 27/03/2022 well within the me permitted by the CBDT and obtained the same on 04/04/2022. In view of this fact, it was impossible for the assessee to give the new registraon particulars in ITR-7 which was filed on 13/03/2022. The Learned Authorized Representative (“learned AR”) submitted that in view of the extension of me for filing the renewal applications U/s. 12AB of the Act in all the cases of earlier registered continues up to 30/09/2022, the existing registraon connotes to be valid for claiming exemption U/s. 11 of the Act for the AY 2021-22 ll such me the renewal was communicated. The learned AR placed reliance on the decision taken by the Coordinate Bench of the Tribunal in the case of Shambhu Dayal Modern School vs. ITO (Exemption) in ITA No. 1236/Del/2024 (AY: 2021-22), dated 02/08/2024.
7. Though the learned Departmental Representative (“learned DR”) vehemently opposed the request of the assessee, he could not contradict the fact that the CBDT by its Circular No. 08/2022, dated 31/03/2022 extended the me for filing the renewal applications in case of the entities, like the assessee, ll 30/09/2022 and also the fact that the assessee submitted its applicant well within such me and the renewal communication was received by the assessee on 04/04/2022.
8. On a careful consideration of all these facts, we are of the considered opinion that the view taken by the Coordinate Bench of this Tribunal in the case of Shambhu Dayal Modern School vs. ITO (Exemption) (supra), is applicable to the facts of the assessee’s present case. Apart from that, the CBDT was perming the new applications U/s. 12AB of the Act in all the cases of earlier registered entities upto 30/09/2022 which means that the filing of applicant by the assessee on 27/03/2022 was well within the me. When the assessee received the communication of renewal on 04/04/2022, it was not possible for the assessee to mention such details in ITR-7 which was filed on 13/03/2022. Law does not require the performance of the impossible act. It was impossible for the assessee to mention the renewal details obtained on 04/04/2022 in ITR-7 which was filed on 13/03/2022. The learned Revenue Authorities should have taken a constructive view in this matter.
9. With this view of the matter, we set-aside the impugned order and restore the issue to the file of the learned AO to complete the assessment in accordance with law by taking the furnishing of the old Registraon Number as proper compliance with. It is ordered accordingly.
10. In the result, appeal of the assessee is allowed for statistical purposes.
Order pronounced in the open court on 19th November, 2024.
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