Back
2025 Supreme(Online)(ITAT) 5135
INCOME TAX APPELLATE TRIBUNAL (HYDERABAD BENCH)
SHRI G. MANJUNATHA, ACM, SHRI RAVISH SOOD, JM
Sri Modh Visa Gowbhuja Sajna – Appellant
Versus
CIT(Appeals)/NFAC, Delhi – Respondent
I.T.A.No.582/Hyd/2025
For the Appellants/Petitioners: B. Satyanarayana Murthy
For the Respondents: None
Without a valid application pending, deemed registration under the Income Tax Act does not apply, validating previous exemptions does not confer rights without appropriate registration.
Headnote:(A) Income Tax Act, 1961 - Sections 11, 12A, 12AA - Exemption claims - Assessee society claimed exemption under Section 11 but was denied due to lack of registration under Section 12A/12AA - Grounds included jurisdictional overreach by CPC and adherence to previous exemptions. (Paras 2, 4, 12, 20)
(B) Legal principles - Court reiterated that no deemed registration shall occur without a valid pending application and that earlier exemptions do not validate subsequent claims unless backed by proper registration.
Facts of the case:
The assessee society filed its return of income for A.Y. 2019-20 claiming exemption of Rs. 1,76,44,761/-, which was rejected due to unregistered status under Section 12A/12AA.
Findings of Court:
Rejection of earlier exemption claims confirmed as no valid application for registration was pending as per legal standards.
Issues: The central issue was whether the delay in application affected the society's status and entitlement to exemption.
Ratio Decidendi: The court ruled no valid registration existed as proper application procedures were not followed, hence, the CPC acted rightly in denying the exemption claim.
Result: Appeal dismissed.
| Table of Content |
|---|
| 1. arguments surrounding jurisdiction over the cpc's adjustments. (Para 7 , 18) |
| 2. exemption was based on registration claims. (Para 10) |
| 3. court observations about the legal status of the application for registration. (Para 12) |
| 4. ruling on the validity of registration processes and exemption claims. (Para 20 , 22) |
| 5. final conclusion dismissing the appeal. (Para 23) |
ORDER
PER RAVISH SOOD, J.M.
The present appeal filed by the assessee society is directed against the order passed by the CIT(Appeals)/NFAC, Delhi, dated 01/02/2025, which in turn arises from the intimation dated 18/05/2020 issued by the Centralized Processing Centre (CPC), Bengaluru under Section 143(1) of the Income-tax Act, 1961 (in short, "the Act"). The assessee society has assailed the impugned order on the following grounds of appeal before us (as uploaded):
“1. The Orders of the lower authorities in the case Appellant are contrary to the facts of the case and the Provisions of Law.
2. The learned Commissioner of Income Tax (Appeals) should have appreciated that the adjustment made by CPC in its intimation dated 18.5.2020 is outside the jurisdiction of the СРС.
3. The learned Commissioner of Income Tax (Appeals) should have appreciated that the adjustment made by the CPC is not justifiable as it is debatable even because the learned Commissioner of Income Tax adjudicated the issue by passing an Order running into 23 paras on 9 pages.
4. The learned Commissioner of Income Tax (Appeals) should have appreciated that the Appellant Society is entitled to the exemption provided in Section 11 of the Income Tax Act as it has complied with the requirements U/s.12A of the Income Tax Act
5. The learned Commissioner of Income Tax should have appreciated that the Appellant Company filed an Application for Registration on 1.4.1991 and therefore it is deemed to have been granted Registration with effect from 01.12.1989 as the For Sti Modh Visa Gowbhuja Sajoa President Registration papers should be deemed to have been transferred to the Commissioner of Income Tact with effect from 1.6.1999.
6. The learned Commissioner of Income Tax (Appeals) erred in holding that the Supreme Court in the case of the Commissioner of Income Tax vs Society for the Promotion of Education [2016] 238 Taxman 339 (SC) did not lay down any Principle of Law whereas the Supreme Court clearly held that if the Application U/s.12A/12AA kept pending by the Commissioner of Income Tax for a period of 6 months, such applicant shall be deemed to be Registered U/s.12A/12AA with effect from the end of 6 months.
7. The learned Commissioner of Income Tax (Appeals) has wrongly relief on the Full Bench decision of Allahabad High Court in the case of CIT vs Muzzafernagar Development Authority 372 ITR 209, which was passed prior to the Judgment of the Supreme Court. 8. For these and other grounds that may be urged at the time of the hearing of the Appeal it is prayed that the Order of the learned Commissioner of Income Tax (Appeals) may kindly be set aside or modified as may be deemed fit. “
2. Succinctly stated, the assessee society that claims to be a charitable and religious trust, had filed its return of income for A.Y. 2019-20, declaring Nil income (after raising a claim of exemption u/s 11 of Rs. 1,76,44,761/-). The AO/CPC, Bengaluru for want of details of registration under Section 12A /12AA or approval under Section 10(23C) of the Act, vide its intimation issued u/s 143(1) of the Act, dated 18.05.2020, declined the claim of the assessee society for exemption u/s 11 of the Act of Rs. 1,76,44,761/-, and determined its total income at ₹1,76,44,761/-.
3. Aggrieved, the assessee society carried the matter in appeal before the CIT(Appeal), but without success. For the sake of clarity, we deem it apposite to cull out the observations of the CIT(A) as under:
“6. DECISION:
I have carefully considered the submissions made by the appellant, the facts on record and the applicable law in this regard.
