INCOME TAX ACT, 1961

Section 254(1)

Appeal (Tribunal) - Order of ITAT - Tribunal following the principle of consistency allowed exemption claimed by assessee under section 11 -

Assessee continued to enjoy exemption under section 11/12 of the Act since the assessment year 2002-03. During concerned assessment year the AO took a different view and disallowed the claim of exemption. However, upon appeal, CIT(A) allowed the assessee's appeal and granted exemption. It was confirmed in further appeal, by the Tribunal, Revenue approached High Court and pleaded that Tribunal had erred in law in relying upon the orders passed in assessee's own case for preceding years without appreciating that income-tax proceedings for each year being different proceedings, the principle of res judicata is not applicable in the income-tax proceedings. Held: Primary facts affecting the claim of exemption on the strength of 'charitable purpose' pursued by the assessee remained common for all assessment years, as were specifically examined during the assessment proceedings for assessment year 2010-11. As they have remained unaltered throughout, AO had not pointed out any difference of fact or in law having arisen in the assessment year in question. Tribunal has clearly recorded a finding that surplus generated by the assessee in the pursuit of its 'charitable purpose' could not be taxed as profit. The activity pursued by the assessee having remained same and it not being in dispute that assessee was granted registration under section 12A which registration also remained intact, it was not possible to allow the revenue to entertain another view in the subsequent assessment year solely because each assessment year is a separate unit.

Relied:Radhasoami Satsang v. CIT (1992) 193 ITR 321 (SC) : 1992 TaxPub(DT) 858 (SC).

REFERRED :

FAVOUR : In assessee's favour.

A.Y. : 2003-04 to 2012-13

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