The case revolves around the denial of tax exemptions to Distt Red Cross Society, Faridabad by the Income Tax Officer (Exemption), Haryana. The tribunal addresses two separate orders from the Commissioner of Income-tax (Appeals) for the assessment years 2010-11 and 2015-16. This consolidated order aims to tackle shared grounds between these years.
Distt Red Cross Society faced rejections in their claims for exemption under Sections 11 and 12 of the Income Tax Act, along with challenges related to reassessment proceedings for the year 2010-11. Notably, for the 2010-11 assessment year, the society did not file a regular income tax return, prompting the Income Tax Department to initiate a reassessment based on significant cash deposits noticed in the society’s bank account.
The tribunal heard the cases together due to common legal grounds, focusing on the disallowance of exemptions claimed by the society. Represented by Sh. Kapil Goel, Advocate, and opposed by Sh. Sujeet Kumar, CIT(DR), the society contested the adequacy of the reassessment and the application of exemptions despite the granted registration for subsequent years.
The tribunal, after examining the evidence, decided to restore the matter back to the CIT(A) for a de-novo adjudication concerning the applicability of exemptions for the years in question. This decision underscores the need for a detailed verification of the society’s objects and activities to ensure they align with the requirements for tax exemptions under the Income Tax Act.
This case highlights critical aspects of procedural justice and the interpretation of tax laws, particularly in how they apply to charitable organizations like the Red Cross Society. The tribunal’s decision to remand the case back for further examination serves as a pivotal moment for tax jurisprudence, especially concerning the eligibility for exemptions under Sections 11 and 12.
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