Case Number: ITA 5787/DEL/2019
Appellant: IOV Registered Valuers Foundation, New Delhi
Respondent: CIT(E), New Delhi
Assessment Year: N/A
Result: Appeal allowed for statistical purposes
Case Filed on: 2019-07-03
Order Type: Final Tribunal Order
Date of Order: 2019-10-18
Pronounced on: 2019-10-18
The appeal by IOV Registered Valuers Foundation (the appellant) was directed against the order dated 28/06/2019, passed by the Commissioner of Income Tax (Exemption) [CIT(E)], New Delhi, which rejected the appellant’s application for registration under Section 12AA of the Income-tax Act, 1961 (the Act).
The appellant was incorporated on 19/12/2017 under Section 8 of the Companies Act, 2013, as a non-profit organization. It claimed recognition as a Registered Valuers Organization in terms of Rule 13 of the Companies (Registered Valuers and Valuation) Rules, 2017, for valuation of assets including land and building, plant and machinery, and securities or financial assets. The appellant filed an application seeking registration under Section 12AA of the Act, which the CIT(E) rejected.
The appellant raised several grounds in its appeal:
The CIT(E) observed that:
The CIT(E) concluded that the appellant was engaged in commercial activities and that the charitable nature of its objectives and genuineness of its activities could not be established. Consequently, the application for registration under Section 12AA of the Act was rejected.
The appellant, represented by Shri Amit Goel, Advocate, argued that:
The respondent, represented by Shri Kanwaljit Singh, CIT(DR), argued that:
The tribunal, comprising Shri Sudhanshu Srivastava, Judicial Member, and Shri O.P. Kant, Accountant Member, observed that for registration under Section 12AA of the Act, the entity’s objectives should be charitable and its activities genuine. The tribunal found that the CIT(E) had not adequately examined whether the appellant’s educational activities constituted formal schooling as required by law.
The tribunal noted the appellant’s claim of providing education under the Companies (Registered Valuers and Valuation) Rules, 2017, and the recognition certificate from IBBI. The tribunal found that the CIT(E) had treated the appellant’s activities as mere coaching classes without proper examination of the nature of education imparted.
The tribunal set aside the order of the CIT(E) and remitted the matter back to the CIT(E) for re-examination of the appellant’s eligibility for registration under Section 12AA of the Act. The CIT(E) was directed to verify whether the appellant’s educational activities were in the nature of formal schooling and to consider the appellant’s eligibility for registration under the fourth limb of charitable purposes, i.e., advancement of general public utility.
The appeal was allowed for statistical purposes.
Order Pronounced in the Open Court on 18th October, 2019.
Signed:
Sudhanshu Srivastava, Judicial Member
O.P. Kant, Accountant Member
Dated: 18th October, 2019
RK-(D.T.D.)
Copy Forwarded to:
Assistant Registrar, ITAT, New Delhi
IOV Registered Valuers Foundation vs CIT(E), New Delhi: Rejection of Section 12AA Registration
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