The Assessing Officer, after completion of the assessment proceedings, made a reference to the Principal Commissioner for cancellation of the assessee’s registration under section 12AB(4) on the basis of incriminating material found during search. The Tribunal held that the reference contemplated under the second proviso to section 143(3) could be made only during the pendency of the assessment proceedings and to the competent Commissioner (E). The reference made after completion of assessment to the Principal Commissioner was without jurisdiction. Accordingly, the order cancelling the registration was held to be invalid.\u00a0 The Principal Commissioner invoked section 12AB(4) to cancel the assessee’s registration for alleged specified violations pertaining to assessment years 2015-16 to 2021-22. The Tribunal held that section 12AB(4), inserted with effect from 1-4-2022, operates prospectively and could not be invoked in respect of earlier assessment years. Consequently, the show-cause notices and the cancellation order passed under the provision were held to be without authority of law and were quashed. While cancelling the assessee’s registration, the Principal Commissioner directed that the cancellation would continue to operate even if the alleged specified violations were ultimately found not to exist. The Tribunal held that such a direction amounted to a colourable and arbitrary exercise of power and disclosed complete non-application of mind. The cancellation order was, therefore, held to be unsustainable and was quashed.\u00a0 (AY.\u00a0 2015-16 to 2021-22).<\/p>\n","protected":false},"excerpt":{"rendered":"
S. 12AA: Procedure for registration-Trust or institution-Cancellation-Reference by Assessing Officer after conclusion of assessment proceedings-Reference to Principal Commissioner without jurisdiction-Cancellation of registration held invalid–Provision inserted with effect from 1-4-2022-Not applicable to earlier assessment years-Show-cause notices and cancellation order quashed-Direction that cancellation would survive irrespective of finding on specified violation-Colourable exercise of power-Order quashed. [S. 12AB(4), 127(2), 143(3)]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_feature_clip_id":0,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_post_was_ever_published":false},"categories":[21],"tags":[],"class_list":["post-62738","post","type-post","status-publish","format-standard","hentry","category-income-tax-act"],"acf":[],"jetpack_featured_media_url":"","jetpack_shortlink":"https:\/\/wp.me\/p9S2Rw-gjU","jetpack-related-posts":[],"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/62738","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/comments?post=62738"}],"version-history":[{"count":1,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/62738\/revisions"}],"predecessor-version":[{"id":62739,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/62738\/revisions\/62739"}],"wp:attachment":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/media?parent=62738"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/categories?post=62738"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/tags?post=62738"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}