- (1.) THIS appeal by the Revenue, seeks to challenge the order of the Tribunal, dt. 24th June, 2005, whereby the appeal of the assessee was allowed.
(2.) THE appeal was admitted on 4th Aug., 2006, by formulating two substantial questions of law, which read as under: (1) Whether on the facts and in the circumstances of the case, the learned Tribunal is justified in setting aside the assessment order, ignoring the provisions of Section 147 of the IT Act, 1961 the AO validly issued notice under Section 148 of the Act? (2) Whether on the facts and in the circumstances of the case, the learned Tribunal is justified in allowing the exemption under Section 11(i)(d) of the IT Act, 1961, ignoring the fact that the objects of the trust providing benefit to Maheshwari community was hit by the provisions contained in Clause (i) of Section 13 in view of the decision in Ghulam Mohidin Trust v. CIT (2001) 168 CTR (J&K;) 367 : (2001) 248 ITR 587 , which is squarely applicable in this case?. The necessary facts are, that the assessee is a charitable trust, which came into existence on 17th Oct., 1995, and was granted registration by Registrar of Societies on the same day. The registration under Section 12AA was granted to the trust on 14th Aug., 1997. The return of income, for the year under consideration (financial year 1997 -98), corresponding to asst. yr. 1998 -99, was filed on 31st March, 2000, declaring nil income. The return was duly accompanied, with the audit report in Form No. 10B and return was assessed under Section 143(1)(a) on 21st March, 2000. However, thereafter, notice under Section 148 was issued on 28th May, 2001, on the basis of reasons recorded, and forming part of the assessment order, being as under: During the year under consideration, the trust has shown receipt of donation of Rs. 30,16,598 in the corpus fund. Whereas the amount has been received without specific directions, therefore, this amount cannot be treated for corpus. Further, the registration under Section 12AA was granted w.e.f. 14th Aug., 1997, therefore donation of Rs. 12,11,100 received before 14th Aug., 1997 is liable to tax, which has not been shown as taxable.
(3.) THE assessee, in response to the notice submitted, that the return already filed may be treated as return in response to notice under Section 148, consequently, the assessment was completed on the total income of Rs. 33,09,100 and was upheld in appeal. The controversy, raised before the Tribunal, was on two standpoints; first being about validity of the issuance of notice under Section 148, and other being about admissibility of the exemption, with respect to fund received by the assessee, before grant of registration under Section 12AA i.e. 14th Aug., 1997. On both the aspects, the learned Tribunal decided in favour of the assessee, and allowed the appeal.;