Wp(C)/34903/2011 Of Janatha Charitable Society, Rep. By Its v. Commissioner Of Income Tax, Calicut And

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HONOURABLE MR.JUSTICE C.K.ABDUL REHIM WEDNESDAY, THE 7TH DAY OF JANUARY 2015/17TH POUSHA, 1936 WP(C).No. 34903 of 2011 (K) ---------------------------- PETITIONER : --------------------- JANATHA CHARITABLE SOCIETYVELLUR (P.O.), PAYYANNUR, KANNURPIN -670 307REPRESENTED BY ITS SECRETARY SRI. E. BHASKARAN BY ADV. SRI.S.ARUN RAJ RESPONDENT(S) : ---------------------------- 1.COMMISSIONER OF INCOME TAXMANACHIRA, CALICUT – 673 001.MANACHIRA, CALICUT – 673 001. 2.DEPUTY COMMISSIONER OF INCOME TAXCIRCLE I, KANNUR RANGE, KANNUR – 670 001.CIRCLE I, KANNUR RANGE, KANNUR – 670 001. 3.CHIEF COMMISSIONER OF INCOME TAXCOCHIN – 682 018.COCHIN – 682 018. R1 TO R3 BY ADV. SRI.JOSE JOSEPH, SC THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 07-01-2015, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: Mn ...2/- APPENDIX PETITIONER'S EXHIBITS : EXT.P1: COPY OF THE CONSTITUTION AND THE BYE LAW OF THEPETITIONER SOCIETY. EXT.P2COPY OF THE ORDER DATED 15-12-2009 PASSED UNDER SECTION12AA(3) PASSED BY THE COMMISSIONER OF INCOME TAX, KANNUR.12AA(3) PASSED BY THE COMMISSIONER OF INCOME TAX, KANNUR. EXT.P3COPY OF THE APPEAL MEMORANDUM FILED BY THE PETITIONERSOCIETY BEFORE THE INCOME TAX APPELLATE TRIBUNAL, COCHIN.SOCIETY BEFORE THE INCOME TAX APPELLATE TRIBUNAL, COCHIN. EXT.P4COPY OF THE ORDER DATED 28-6-2011 PASSED BY THE HON'BLEINCOME TAX APPELLATE TRIBUNAL, COCHIN BENCH, COHIN INEXHIBIT P-3 APPEAL.INCOME TAX APPELLATE TRIBUNAL, COCHIN BENCH, COHIN INEXHIBIT P-3 APPEAL. EXT.P5(a)COPY OF THE RE-ASSESSMENT ORDER DATED 4-11-2011 UNDERSECTION 147 OF THE INCOME TAX ACT PASSED BY THE 2NDRESPONDENT FOR THE AY'S 2003-04.SECTION 147 OF THE INCOME TAX ACT PASSED BY THE 2NDRESPONDENT FOR THE AY'S 2003-04. EXT.P5(b)COPY OF THE RE-ASSESSMENT ORDER DATED 4-11-2011 UNDERSECTION 147 OF THE INCOME TAX ACT PASSED BY THE 2NDRESPONDENT FOR THE AY'S 2004-05.SECTION 147 OF THE INCOME TAX ACT PASSED BY THE 2NDRESPONDENT FOR THE AY'S 2004-05. EXT.P5(c)COPY OF THE RE-ASSESSMENT ORDER DATED 4-11-2011 UNDERSECTION 147 OF THE INCOME TAX ACT PASSED BY THE 2NDRESPONDENT FOR THE AY'S 2005-06.SECTION 147 OF THE INCOME TAX ACT PASSED BY THE 2NDRESPONDENT FOR THE AY'S 2005-06. EXT.P5(d)COPY OF THE RE-ASSESSMENT ORDER DATED 4-11-2011 UNDERSECTION 147 OF THE INCOME TAX ACT PASSED BY THE 2NDRESPONDENT FOR THE AY'S 2006-07.SECTION 147 OF THE INCOME TAX ACT PASSED BY THE 2NDRESPONDENT FOR THE AY'S 2006-07. EXT.P5(e)COPY OF THE RE-ASSESSMENT ORDER DATED 4-11-2011 UNDERSECTION 147 OF THE INCOME TAX ACT PASSED BY THE 2NDRESPONDENT FOR THE AY'S 2007-08.SECTION 147 OF THE INCOME TAX ACT PASSED BY THE 2NDRESPONDENT FOR THE AY'S 2007-08. EXT.P5(f)COPY OF THE RE-ASSESSMENT ORDER DATED 4-11-2011 UNDERSECTION 147 OF THE INCOME TAX ACT PASSED BY THE 2NDRESPONDENT FOR THE AY'S 2008-09.SECTION 147 OF THE INCOME TAX ACT PASSED BY THE 2NDRESPONDENT FOR THE AY'S 2008-09. RESPONDENT'S EXHIBITS : NIL //TRUE COPY// P.S. TO JUDGE C.K. ABDUL REHIM, J.--------------------------- W.P.(C)No.34903 of 2011 ------------------------------- Dated this the 7[th] day of January, 2015 JUDGMENT EXT.P5(e)COPY OF THE RE-ASSESSMENT ORDER DATED 4-11-2011 UNDERSECTION 147 OF THE INCOME TAX ACT PASSED BY THE 2NDRESPONDENT FOR THE AY'S 2007-08.SECTION 147 OF THE INCOME TAX ACT PASSED BY THE 2NDRESPONDENT FOR THE AY'S 2007-08. EXT.P5(f)COPY OF THE RE-ASSESSMENT ORDER DATED 4-11-2011 UNDERSECTION 147 OF THE INCOME TAX ACT PASSED BY THE 2NDRESPONDENT FOR THE AY'S 2008-09.SECTION 147 OF THE INCOME TAX ACT PASSED BY THE 2NDRESPONDENT FOR THE AY'S 2008-09. RESPONDENT'S EXHIBITS : NIL //TRUE COPY// P.S. TO JUDGE C.K. ABDUL REHIM, J.--------------------------- W.P.(C)No.34903 of 2011 ------------------------------- Dated this the 7[th] day of January, 2015 JUDGMENT Ext.P5 series orders of assessment issued underSection 143(3) read with Section 147 of the Income TaxAct, is under challenge in this writ petition. The petitionersociety was granted registration under Section 12 A ofIncome Tax Act with effect from 30/11/1982 andassessments for the subsequent years were finalised bygranting exemption from payment of Income Tax, underSection 11 of the Act. Consequent to amendment broughtwith respect to the definition of charitable purpose, byvirtue of Finance Act 2008 with effect from 01/04/2009, the1[st] respondent had cancelled the registration of thepetitioner society granted under Section 12A, withretrospective effect from the assessment year 2003-2004onwards, by virtue of Ext.P2 proceedings. Ext.P2 orderwas subjected to challenge before the tribunal in appeal. In W.P.(C)No.34903 of 2011 2 Ext.P4 order the tribunal held that the cancellation ofregistration with retrospective effect is not sustainableand that the cancellation can be treated as valid only on aprospective basis from the assessment year 2009-2010onwards. Despite Ext.P4 order passed by the tribunal thereopened assessment for the years 2003-2004 to 2008-2009 were finalised through Ext.P5 series ordersimpugned herein. It is specifically stated in Ext.P5 seriesorders that the department has not accepted Ext.P4 orderand the Chief Commissioner of Income Tax wasauthorised for filing appeal before the High Court.Therefore the assessments were finalised as if the societyis not entitled for exemption under Section 11. 2. It is submitted that Ext.P4 order of the tribunalwas challenged in appeal by the revenue before this courtin ITA No. 193/2011. It is further submitted that the saidappeal was dismissed by this court through judgmentdated 22/2/2012. The above fact is not disputed bylearned Standing Counsel appearing for the respondents. W.P.(C)No.34903 of 2011 3 3. In view of the fact that cancellation of exemption for the period up to 2009-2010 stands set aside andconfirmed in appeal by this court, the impugnedassessments cannot be sustained, because the petitionersociety was enjoying exemption under Section 11.Therefore the impugned orders are liable to be quashed. In the result, the writ petition is allowed and Ext.P5series orders of assessment are hereby quashed. Sd/- C.K. ABDUL REHIMJUDGE MJL