The Southern India Chamber Of Commerce And Industry,Indian Chamber Building v. The Deputy Director Of Income Tax, (Exemptions)-Ii

IN THE HIGH COURT OF JUDICATURE AT MADRAS The Southern India Chamber of Commerce and Industry,Indian Chamber Building,No.6, Esplanade Road,Chennai – 600 108.Represented by its Secretary,S. Raghavan... Petitioner Vs 1. The Deputy Director of Income tax, (Exemptions)-II, 124, M.G. Road, Chennai – 600 034. 2. The Director of Income tax, (Exemptions)-II, 124, M.G. Road, Chennai – 600 034. ... Respondents Prayer: Petition filed under Article 226 of the Constitutionof India to issue a Writ of Certiorarified Mandamus, to callfor the records of the Second Respondent and quash theImpugned Notice issued under Section 12AA(3) of the Act in DIT(E) No.124 III/12AA(3)/2011-2012 dated 01-11-2011 for theassessment year 2009-2010 and direct the Second Respondent todrop the proceedings initiated for withdrawing theregistration granted under Section 12AA of the Act. For Petitioner : Mr. R. Venkat Narayanan for Mr. Subbraya Aiyar & Ramamani For Respondents : Mr. D. Prabhu Mukunth Arun Kumar Junior Standing Counsel for Mrs. Hema Muralikrishna Senior Standing Counsel This writ petition has been filed by the Petitioner,praying for the issuance of Writ of Certiorarified Mandamus,to call for the records of the Second Respondent and quash theImpugned Notice issued under Section 12AA(3) of the Act in DIT(E) No.124 III/12AA(3)/2011-2012 dated 01-11-2011 for theassessment year 2009-2010 and direct the Second Respondent todrop the proceedings initiated for withdrawing theregistration granted under Section 12AA of the Income Tax Act,1961. 2. The Petitioner has challenged the impugned noticedated 01.11.2011 seeking to revoke the registration granted tothe Petitioner under Section 12A of Income Tax Act, 1961 underSub-section A (a) (3) of the Income Tax Act, 1961 (in shortthe IT Act, 1961). The Petitioner was originally given acertificate under Section 12A(a) (3) of the IT Act, 1961 asearly as 07.12.1982. 3. The main income of the Petitioner appears to be fromissue of Certificate of origin, Certificate of invoice,Electricity Charges, Conservancy charges, Security Charges andrent from commercial complexes. It is under thesecircumstances, a notice was issued to the Petitioner underSection 148 of the IT Act, 1961 dated 24.02.2011 to reopen theassessment and parallely a notice was issued to cancel theregistration granted to the Petitioner. As far as theassessment proceedings are concerned, the issue went up to theTribunal and the Tribunal by an order dated 17.04.2015 hasultimately come to a conclusion that the activity of thePetitioner is charitable in nature. (Order dated 17.04.2015in I.T.A. Nos. 2733 & 2734/Mds/2014). 4. The learned counsel for the Petitioner has relied onthe following three cases which appear to be in favour of thePetitioner. (a) The decision of the Karnataka High Court in the caseof “Director of Income Tax (Exemption) Vs Karnataka IndustrialArea Development Board, 2015 229 TAXMAN 0539 (Karnataka).(b) The decision of this Court in the case of Tamil NaduCricket Association Vs Director of Income Tax (Exemptions),2014 265 CTR 0277 (Mad) : 2014 98 DTR 0299 (Mad) : 2014 221TAXMAN 0275 and (c) The decision of this Court in the case of CIT VsSarvodaya Ilakkiya Pannai, 2012 250 CTR 0332 : 2012 343 ITR0300. 5. I am of the view that the Petitioner shouldparticipate in the proceeding before the Second Respondent whoissued the notice seeking to cancel the registration grantedunder Section 12 (A) (a) of the IT Act, 1961. (a) The decision of the Karnataka High Court in the caseof “Director of Income Tax (Exemption) Vs Karnataka IndustrialArea Development Board, 2015 229 TAXMAN 0539 (Karnataka).(b) The decision of this Court in the case of Tamil NaduCricket Association Vs Director of Income Tax (Exemptions),2014 265 CTR 0277 (Mad) : 2014 98 DTR 0299 (Mad) : 2014 221TAXMAN 0275 and (c) The decision of this Court in the case of CIT VsSarvodaya Ilakkiya Pannai, 2012 250 CTR 0332 : 2012 343 ITR0300. 5. I am of the view that the Petitioner shouldparticipate in the proceeding before the Second Respondent whoissued the notice seeking to cancel the registration grantedunder Section 12 (A) (a) of the IT Act, 1961. 6. The Second Respondent shall therefore consider theorder passed by the Tribunal in the Petitioner's own case andthe decisions which have been cited above by the Petitionerwhile disposing the impugned proceedings. Since the disputeis pertaining to the year 2011, the Second Respondent isdirected to dispose the said proceedings within a period ofthree months from the date of receipt of a copy of this order.It is needless to state that the Petitioner shall be heardbefore such orders being passed. This Writ Petition standsdisposed of. No costs. Consequently, the connectedmiscellaneous petition is closed. Sd/- Assistant Registrar(CS-VIII) //True Copy// Sub Assistant Registrar arbTo 1. The Deputy Director of Income tax, (Exemptions)-II, 124, M.G. Road, Chennai – 600 034.2. The Director of Income tax, (Exemptions)-II, 124, M.G. Road, Chennai – 600 034. +1cc to Mrs.Hema Muralikrishnan, Advocate SR.4962 EV(CO)CB(21/02/2020) W.P. No. 30035 of 2011 andM.P. No. 1 of 2011