{"id":8239,"date":"2014-08-05T14:49:14","date_gmt":"2014-08-05T09:19:14","guid":{"rendered":"http:\/\/itatonline.org\/archives\/?p=8239"},"modified":"2014-08-05T14:49:14","modified_gmt":"2014-08-05T09:19:14","slug":"parkar-medical-foundation-vs-dcit-itat-pune","status":"publish","type":"post","link":"https:\/\/itatonline.org\/archives\/parkar-medical-foundation-vs-dcit-itat-pune\/","title":{"rendered":"Parkar Medical Foundation vs. DCIT (ITAT Pune)"},"content":{"rendered":"\n\n
Click here to download the judgement (parkar_costs_254_2B.pdf) <\/strong> <\/a><\/p><\/td>\n<\/tr>\n<\/table>\n


\nS. 254(2B): Even though action of the CIT in canceling registration u\/s 12AA(3) is illegal, costs cannot be awarded as the said action is in discharge of duty & not mala fide<\/strong> <\/p>\n

The assessee filed an appeal challenging the order of the CIT u\/s 12AA(3) canceling the registration granted to the assessee trust. The assessee also pleaded for award of costs u\/s 254(2B) on the ground that the action of the department of canceling registration was illegal and an abuse of powers and that it had has caused serious prejudice and injustice to the assessee. It was pointed out that wrong signals had been transmitted in the society that the assessee trust is a big fraud and that this had adversely affected the reputation of the trust and its trustees who are eminent medical practitioners. It was also claimed that there is an unpleasant social environment in Ratnagiri and that since the trustees are from the minority community, the department\u2019s action have embarrassed the trustees and the trust. HELD by the Tribunal:<\/p>\n

(i) As per s. 12AA(3) the CIT can cancel the registration granted earlier if he \/she is satisfied that the activities of such trust or institution are not genuine or are not being carried out in accordance with the objects of the trust or the institution. In the instant case, there is no such finding given by the CIT that the activities of the trust are not genuine or are not being carried out in accordance with the objects of the trust. While granting registration u\/s 12A, the CIT has gone through the objects of the trust and the genuineness of the activities. There is no change in the objects of the trust in the meantime. The CIT has not brought on record any material to show that the activities of the Trust are not being carried out in accordance with the objects of the Trust or the institution. Once registration is granted to the trust\/institution and if subsequently the AO finds during the assessment proceedings that the income of the charitable trust is applied directly or indirectly for the benefit of the persons referred to in s. 13(3), then he has ample power to deny exemption to that extent u\/s 13(1)(c) of the Act (Modern Defence Shikshan Sansthan<\/strong> 108 TTJ (Jodh) 732, Himachal Pradesh Environment Protection and Pollution Control Board<\/strong> 125 TTJ (Chd) 98, Maharashtra Academy of Engineering as Educational Board<\/strong> 133 TTJ 706 (Pune) followed)<\/p>\n

(ii) The CIT has passed the order u\/s 12AA(3) of the Act during the course of discharge of her duty as CIT. While discharging her duty, her action might have caused some hardship to the assessee due to error of judgement but that in our opinion does not warrant levy of cost on the department. In Pooran Mal vs. Director<\/strong> 93 ITR 505 (SC), it was noted that s. 132 causes serious invasion of the privacy of a person. Still it was held that even though the innocent is likely to be harassed by a raid for the purpose of search and seizure, that cannot be helped. In the instant case, there is no such action of search and seizure which causes serious invasion in the privacy of the person. The CIT was discharging her quasi-judicial duty. Further, there is nothing on record to suggest that the action of the CIT was mala fide. Therefore, there is no merit in the claim for award of costs for the action of the CIT in cancelling the registration granted earlier u\/s 12AA of the Act (UOI vs. Raja Mohammed Amir Mohammad Khan<\/strong> (SC), Urban Improvement Trust<\/strong>, Bikaner vs. Mohanlal<\/strong> (2010) (1 SCC 512) (SC) & Charanjilal Tak Shyam Parwani vs. UOI<\/strong> 252 ITR 333 (Raj) distinguished)<\/p>\n

Contrast with Audyogik Tantra Shikshan<\/a><\/strong> (ITAT Pune) & Shramjivi Nagari Sahakari Pat Sanstha<\/a><\/strong> (ITAT Pune) where costs were awarded on the ground that \u201charassment\u201d was caused to the assessee<\/div>\n","protected":false},"excerpt":{"rendered":"


\nS. 254(2B): Even though action of the CIT in canceling registration u\/s 12AA(3) is illegal, costs cannot be awarded as the said action is in discharge of duty & not mala fide<\/strong><\/p>\n

(ii) The CIT has passed the order u\/s 12AA(3) of the Act during the course of discharge of her duty as CIT. While discharging her duty, her action might have caused some hardship to the assessee due to error of judgement but that in our opinion does not warrant levy of cost on the department. In Pooran Mal vs. Director<\/strong> 93 ITR 505 (SC), it was noted that s. 132 causes serious invasion of the privacy of a person. Still it was held that even though the innocent is likely to be harassed by a raid for the purpose of search and seizure, that cannot be helped. In the instant case, there is no such action of search and seizure which causes serious invasion in the privacy of the person. The CIT was discharging her quasi-judicial duty. Further, there is nothing on record to suggest that the action of the CIT was mala fide. Therefore, there is no merit in the claim for award of costs for the action of the CIT in cancelling the registration granted earlier u\/s 12AA of the Act (UOI vs. Raja Mohammed Amir Mohammad Khan<\/strong> (SC), Urban Improvement Trust<\/strong>, Bikaner vs. Mohanlal<\/strong> (2010) (1 SCC 512) (SC) & Charanjilal Tak Shyam Parwani vs. UOI<\/strong> 252 ITR 333 (Raj) distinguished)<\/p>\n

Read more ›<\/a><\/div>\n

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