(S. Ravindra Bhat and Dipankar Datta, JJ.)
Commissioner of Income Tax (Exemption) ______________ Petitioner;
v.
Sant Girdhar Anand Parmhans Sant Ashram ____________ Respondent.
Civil Appeal No. 1520 of 2023 (arising out of Special Leave to Appeal (C) No. 31404/2018), decided on February 28, 2023
The Order of the court was delivered by
Order
1. Leave granted.
2. Heard learned counsel for the parties.
3. The revenue is aggrieved by judgment of the Punjab and Haryana High Court which affirmed the ruling of the Income Tax Appellate Tribunal. The ground on which revenue contends that the impugned judgment is incorrect is the provision of Section 80G (5B) of the Income Tax act read with Rule 11 AA of the Income Tax Rules.
4. The respondent assessee trust’s objects include inter alia spiritual awakening of the common masses, spreading teachings of great Indian saints, organizing gatherings of the people desirous to be benefited from spiritual preachings, publicizing such preachings and philosophies of great saints and extending financial assistance to the poor, destitute etc.
5. The Commissioner to whom the assessee applied for grant of exemption of the donations received by it, refused that benefit citing Section 80G (5B) and noticing that the assessee was spending more than 5% of the receipts for religious purposes such as puja expenses besides which it also incurred telecast expenses. The ITAT and the High Court principally went by the circumstance that the certificate under Section 12AA of the Income Tax Act was subsisting.
6. Having heard counsel for the parties and having considered the record, what is evident is that neither the order of refusal of the certificate under Section 80G (5B) nor the subsequent order of the ITAT dealt with essential facts as to the quantum of receipts and the expenditure incurred. While there can be no dispute that the assessee asserts that it continues to hold exemption under Section 12AA of the Income Tax Act, nevertheless, for the benefit under Section 80G (5B), the requirements of that provision have to be satisfied separately.
7. The learned counsel for the assessee had relied upon the judgment of this Court reported as Commissioner of Income Tax v. Dawoodi Bohara Jamat, however, this Court is of the opinion that in view of the final order we proposed, there is no need to discuss the applicability or otherwise of that decision.
8. In view of the fact that the Commissioner’s order as well as the order of the ITAT are bereft of any factual details as to the nature of activities which the assessee/applicant carries on as well as the details of the accounts involved and furthermore, having regard to the fact that the assessee, for some reason, did not participate in the proceedings before the Commissioner of Income Tax except filing of written submissions, this Court is of the opinion that the matter requires to be considered afresh.
9. The assessee had contended that it is recipient of the benefit under Section 80G (5B) for a subsequent period (AY 2022-23 to 2026-27). It is open to the assessee to rely on that aspect as well.
10. In view of the above discussion, the impugned order is hereby set aside. The Commissioner of Income Tax Exemption, Chandigarh is directed to examine the matter afresh in light of the contentions to be urged on behalf of the assessee. All rights and contentions of the parties are kept open.
11. The appeal is allowed.
12. Pending application(s), if any, are disposed of.
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