Per Bench: These three appeals are filed by the Revenue against the common order of the Commissioner of Income Tax (Appeals)-VII, Chennai dated 28.03.2014 for the assessment years 2005-06, 2006-07 and 2009-10.

2. In respect of appeals for the assessment years 2005-06 and 2006-07, the grounds raised by the Revenue for both these two years are common and read as under:- ITA Nos.1932 to 1934/Mds/2014

2.1 The CIT(A) ought to have appreciated the fact that the revised return filed u/s.139(5) cannot be considered as a valid return and the assessee did not make a claim of exemption in the original return filed u/s.139(1) for the A.Ys. 2005-06 & 2006-07.

2.2 The CIT(A) failed to appreciate the fact that no audit u/s.12(1)(b) has been conducted within the time frame envisaged u/s.139(5). Nor has the audit report been filed within the stipulated time.

2.3 It is submitted that the failure on the part of the assessee to claim exemption was wilful and based on its conviction that they are not taxable entities.

2.4 Reliance is placed upon the decision of Apex Court in the case of Goetze (India) Ltd. Vs. CIT (284 ITR 323) which is delivered much later to the decision of Apex Court in the case of Jute Corporation of India Vs. CIT (187 ITR 688 (SC) which was relied upon by the CIT(A).

2.5 The CIT(A) ought to have appreciated that even a valid return filed in response to notice u/s.148 but beyond time limit allowed u/s.139(5) cannot uphold a fresh claim of the assessee as decided in the case of CIT Vs. Sun Engineering Works P.Ltd. (198 ITR 297) (SC).

2.6. The CIT(A) ought to have appreciated the fact that Department has not accepted the decision of the Honble ITAT in ITA No.2118 & ITA Nos.1932 to 1934/Mds/2014 2119/Mds/2010 dated 30.8.2011 and has filed appeal u/s.260A of the I.T. Act.

3. Counsel for the assessee at the time of hearing submits that the issue in appeal has been decided in favour of the assessee by this Tribunal in assessees own case for the assessment years 2003-04 and 2004-05 in ITA Nos. 2118 & 2119/Mds/2010 dated 30.08.2011. Counsel for the assessee places reliance on the order of this Tribunal by filing copy before us. Counsel submits that Tribunal for the earlier assessment years held that the exemption claimed by the assessee under section 11 & 12 in the revised return though for the first time has to be allowed since registration under section 12AA was granted by this Tribunal by order dated

23.5.2008 with retrospective effect from the assessment year 2003-04. Counsel submits that till the assessment year 2002-03, the assessee was claiming exemption under section 10(20) of the Act as a local authority. Therefore since there was no registration under section 12 for the assessee when the return was filed for the assessment years 2005-06 and 2006-07, no claim under section 11 and 12 was made. ITA Nos.1932 to 1934/Mds/2014

4. Departmental Representative supports the orders of Assessing Officer in denying exemption under section 11 of the Act.

5. We have perused the orders of lower authorities and the decision of this Tribunal in assessees own case for the assessment years 2003-04 and 2004-05 which the Commissioner of Income Tax (Appeals) also followed. This Tribunal while disposing off the appeals for the assessment years 2003-04 & 2004-05 held that assessee is entitled for exemption under section 11 though the claim was made in the revised return filed subsequently on granting of registration under section 12AA, of the Act observing as under:-

2. The ld. D.R. submitted that in both these years under consideration, the facts and issue involved are identical. Therefore, he submitted that on going through the facts of Assessment Year 2003- 04, the facts of Assessment Year 2004-05 are also covered. The ld. D.R. submitted that upto Assessment Year 2002-03, the assessee, namely, Chennai Metropolitan Development Authority was treated as a ITA Nos.1932 to 1934/Mds/2014 local authority. By the Finance Act, 2002, in section 10(20A), explanation was added by which the assessee was excluded for being treated as a local authority. From Assessment Year 2003- 04, the income of the assessee was liable to tax. The assessee filed return of income for Assessment Year 2003-04 on 21.11.2003 admitting loss of Rs. 1,42,76,916/ - in Form No. ITS - 2 prescribed for an entity having taxable income. The assessment was completed u/s 143(3) of the Act on 31.3.2006. Income was determined at ` 82,24,87,902/-.

3. The assessee went in appeal and the ld. (IT(A) partly confirmed the Assessing Officers order. Being not satisfied, the assessee went in appeal before the Tribunal.

4. In the meantime, the assessee filed petition for registration u/s 12AA of the Act which was denied by the ld. (IT. But on further appeal, the Tribunal directed the ld. (IT to register the assessee u/s 12AA of the Act w.r.e.f. 2003-04. When the quantum appeals came for hearing before the Tribunal, again the assessment was set aside and restored to the file of the Assessing Officer for doing it afresh keeping in view the development between the earlier return and the passing of the order by the Tribunal Le. issue of registration had to be considered. The Assessing Officer issued notice for hearing. The assessee filed the revised return on 9.3.2009 for Assessment Years 2003-04 and 2004-05. The Assessing Officer examined the issue, heard the assessee and made it clear that the so called revised returns filed were not valid returns and assessees claim u/s 11 and 12 of the Act will not be entertained. The assessee went ITA Nos.1932 to 1934/Mds/2014 to the Joint Director, Income-tax [Exemptions] for direction u/s 144 of the Act. The Joint Director][Exemptions], vide his order dated 29.12.2009, gave directions to the Assessing Officer u/s 144 of the Act. He directed that the returns filed on 9.3.2009, which were invalid returns, could not be considered. But the Assessing Officer may consider the fact of registration of the assessee u / s 12AAof the Act and pass a speaking order including grant of exemption u/s 11 and 12 of the Act or rejection thereof. After considering the directions, the Assessing Officer proceeded to make the assessment. He noted that for getting exemption u/s 11 and 12 of the Act, the assessee has to file a valid return in prescribed form and get its accounts audited as prescribed u/s 12(1)(a) of the Act. No return in the prescribed form was filed. No audit was done within the prescribed time. The audit report was also not filed within the prescribed time. The assessee insisted that its return filed on 9.3.2009 should be considered as a valid return and it could be allowed exemption u/s 11 of the Act. The Assessing Officer stated that granting of exemption is one of the considerations and it is not automatic and does not lead to exemption u/s 11 and 12 of the Act. The Assessing Officer has to examine each and every section before allowing exemption because the Tribunal has not given any relief as to whether the assessee was entitled to exemption u/s 11 and 12 of 29.12.2009, gave directions to the Assessing Officer u/s 144 of the Act. He directed that the returns filed on 9.3.2009, which were invalid returns, could not be considered. But the Assessing Officer may consider the fact of registration of the assessee u/s 12AAof the Act and pass a speaking order including grant of exemption ITA Nos.1932 to 1934/Mds/2014 u/s.11 and 12 of the Act or rejection thereof. After considering the irections, the Assessing Officer proceeded to make the assessment. He noted that for getting exemption u/s 11 and 12 of the Act, the assessee has to file a valid return in prescribed form and get its accounts audited as prescribed u/s 12(1)(a) of the Act. No return in the prescribed form was filed. No audit was done within the prescribed time. The audit report was also not filed within the prescribed time. The assessee insisted that its return filed on 9.3.2009 should be considered as a valid return and it could be allowed exemption u/s 11 of the Act. The Assessing Officer stated that granting of exemption is one of the considerations and it is not automatic and does not lead to exemption u/s 11 and 12 of the Act. The Assessing Officer has to examine each and every section before allowing exemption because the Tribunal has not given any relief as to whether the assessee was entitled to exemption u / s 11 and 12 of the Act or not. The ld. CIT had to confirm what are the objects of the trust and what are the activities carried on by the trust and that he cannot travel beyond that. In the registration certificate, it has been stated by the ld. CIT that it will not entitle the assessee to exemption u/s 11 and 12 of the Act and that it shall be independently considered by the Assessing Officer. The Assessing Officer has relied on several cases and has stated that the assessee cannot revise the return if there is no mistake or omission in the original return filed. The revised return in this case is an invalid return. The assessee has not complied with the pre-requisite condition for availing of exemption. The Assessing Officer has concluded that the assessee was not eligible for exemption u/s ITA Nos.1932 to 1934/Mds/2014 11 of the Act and therefore, he disallowed the claim of the assessee u/s 11 of the Act. The assessee went to the ld. CIT(A). The ld. CIT(A) has relied on the decision of the Honble Supreme Court in the case of Jute Corporation of India Limited Vs. CIT 187 ITR 688 [SC]. This reliance of the ld. CIT(A) is not legally tenable because the facts of that case are totally inapplicable in the case of the assessee. In that case, the assessee raised an additional ground before AAC to allow the claim of purchase tax. The Honble Supreme Court held that since the tax liability was admitted, the ITO was offered an opportunity of being heard and the appellants case was based on the settled view of the law; the AAC had jurisdiction to permit the appellant for raising the additional ground. In the instant case, the issue is of non compliance of section 11 of the Act. The ld. CIT(A), without giving any reason why he is accepting the revised return and granting exemption u/s 11 of the Act has allowed relief to the assessee. The ld. CIT(A) has held at page 6 of his order which is as follows: "Hence I am satisfied that the ground raised by the appellant in this appeal is a bonafide one. In fact, the appellant had taken up this before the Assessing Officer even during the course of assessment proceedings u/s 143(3) of the Act r.w.s 254 of the Act. Thus in consonance with the decision of the Honble Apex Court mentioned above and also in view of the registration u/s 12AA of the Act granted by the DIT(), Chennai with retrospective effect from the Assessment Year 2003-04, the appellant had made a valid claim before the Assessing Officer at the time of reassessment proceedings and hence, ITA Nos.1932 to 1934/Mds/2014 the appellant is eligible for exemption u/s 11 and 12 of the Act on its gross receipts and accordingly, the appeal of the appellant is hereby allowed.

5. The CIT(A)s order is non-speaking order without any basis and devoid of any merits, relying on a case law of Honble Supreme Court, not at all applicable to the facts of the assessees case whereas the Assessing Officer has relied on a number of cases stated in ground No. 1.1 of appeal memo. The ld. CIT(A) has not even discussed those cases, therefore, the order of the ld. CIT(A) may be reversed.

6. On the other hand, the AR of the assesse submitted that the Honble Supreme Court in the case of U.P. Forest Corporation Vs. DCIT reported in (2008) 297 ITR 1 has held that a conjoint reading of sections 11, 12 and 12A of the Act makes it clear that registration u/s.12A is a condition precedent for availing of benefit u/s.11 & 12 of the Act. Unless and until an institution is registered u/s.12A of the Act, it cannot claim benefit of section 11(1)(a) of the Act. He, therefore, submitted that as the registration was granted by the ld. CIT upon the direction of the Tribunal, therefore, the assessee filed original return of income without claiming exemption u/s 11 and 12 of the Act. . As the assessee was not having registration u/s 12A of the Act, it was not entitled to claim exemption u/ss 11 and 12 of the Act and, therefore, assessee did not get its accounts audited and file audit return along with original return of income.

7. The appeal against the original order passed by the Assessing Officer in the years under consideration came upto the ITA Nos.1932 to 1934/Mds/2014 Tribunal and vide order dated 23.5.2008 passed in ITA Nos. 1464 & 388/Mds/2007, the Tribunal set aside the matter for allowing exemption u/s 11 and 12 of the Act back to the file of the Assessing Officer to reframe and review assessment in the light of registration u Is 12AA of the Act granted to the assessee. He further relied on the decision of Honble Madras High Court reported in [1994] 208 ITR 481 [Mds] (IT Vs. Arunachalam [A. N.] and submitted that the Honble Jurisdictional High Court has held that where the preparation of audit report is beyond the control of the assessee, the assessee can justifiably delay the filing of the return of income itself so that it accompanied by the audit report. In such an event, the ITO cannot deny the claim of relief since the purpose of this section would have been fulfilled even though the return is itself filed beyond the prescribed time. The stress laid down in section 80J[A] is only to have the accounts audited and to make the audit report available to the ITO to make proper assessment. He further relied on the decision of the Honble Bombay High Court in the case of Bank of Baroda Vs. H.C. Shrivastava [2002] 256 ITR 385 and submitted that the Honble Bombay High Court has held that the judgment delivered by the ITAT is binding on the Assessing Officer. The Assessing Officer is bound to follow the judgment in its true- spirit and letter. It is necessary for judicial unity and discipline that all the authorities below Tribunal accept as binding the judgment of the Tribunal. He submitted that when the Tribunal has restored the original order of the Assessing Officer back to the file of the ITA Nos.1932 to 1934/Mds/2014 Assessing Officer to readjudicate the issue of exemption u/s 11 and 12 of the Act in the light of the registration granted to the assessee u / s 12A of the Act, the Assessing Officer cannot turn around and say that the assessee has not filed original return in the prescribed form and that the original return was not accompanied together with audit report for allowing exemption to the assessee.

8. In the rejoinder, the ld .. D.R. submitted that only by grant of section 12A registration, exemption u/ s 11 and 12 of the Act cannot be granted since the exemption u/s 11 and 12 of the Act is not automatic. The ld. CIT(A) wrongly interpreted the Tribunal order when the Tribunal has not given any finding on the exemptions. The case law relied upon was not applicable as the assessment order was passed in compliance with the order of the Tribunal.

9. We have heard the rival submissions and perused the orders of the lower authorities and the material available on record. In the instant case, we find that registration u/s 12AA was granted to the assessee institution by the DIT(E) w.r.e. f Assessment Year 2003-04. The Tribunal in the case of the assessee vide order dated 23.5.2008 in ITA Nos. 1464, 188, 182 and 839/Mds/2007 for Assessment Years under consideration restored the assessment back to the file of the Assessing Officer for reframing assessment in the light of the allowance of registration to the assessee u/s 12AA ITA Nos.1932 to 1934/Mds/2014 of the Act. In pursuance thereof, the A.O in the assessment made afresh on

29.12.2009 did not allow exemption u/s.11 and 12 of the Act on the ground that the claim was made for the first time in the revised return which was beyond the time and required audit report also was not filed. The CIT(A) in appeal there against allowed the claim of the assesse by observing as under:-

Hence I am satisfied that the ground raised by the appellant in this appeal is a bonafide one. In fact, the appellant had taken up this before the A.O. even during the course of assessment proceedings u/s.143(3) of the Act r.w.s 254 of the Act. Thus in consonance with the decision of the Apex court mentioned above and also in view of the registration u/s.12AA of the Act granted by the DIT(E)Chennai with retrospective effect from the assessment year 2003-04 the appellant had made a valid claim before the Assessing Officer at the time of reassessment proceedings and hence, the appellant is eligible for exemption u/s.11 and 12 of the Act on its gross receipts and accordingly, the appeal of the appellant is hereby allowed.

10. We find that in the instant case it is not in dispute that when the assessee filed its original return of income at that time, assessee was not granted registration u/s 12AA and therefore, could not claim exemption u/s ITA Nos.1932 to 1934/Mds/2014 11 and 12 of the Act in the original return of income. However, claim of the assessee for getting exemption u/s 11 and 12 of the Act on principal basis was agreed by the .Tribunal in view of registration allowed to the assessee u / s 12AA of the Act w.r.e including for the Assessment Years under consideration. Therefore, the Tribunal restored the matter back to the file of the Assessing Officer for examining and verifying the facts and for allowing exemption u/s 11 and 12 of the Act as per law as both the parties agreed to it before the Tribunal. In view of the above finding of the Tribunal which was accepted by the Revenue, we do not find any error in the order of the ld, CIT(A) in directing the Assessing Officer to allow exemption u/s 11 and 12 of the Act to the assessee. As it is not the case of the Revenue that full details and facts for allowing exemption u/s 11 and 12 of the Act was not available before the Assessing Officer at the time of making of fresh assessment in the light of direction of the Tribunal, we do not find any good reason to interfere with the order of the ld.CIT(A). It is confirmed and grounds of appeal of the Revenue are dismissed.

6. Respectively following the said order, we sustain the order of the Commissioner of Income Tax (Appeals) in allowing exemption under section 11 of the Act to the assessee for both these assessment years 2005-06 and ITA Nos.1932 to 1934/Mds/2014 2006-07 and reject the grounds of appeal raised by the Revenue. ITA No.1934/Mds/2014 :(Asst. Year 2009-10):

7. In this appeal, Revenue contends that Commissioner of Income Tax (Appeals) erred in holding that assessee is eligible for exemption under section 11 of the Act without appreciating the fact that assessee is hit by newly inserted proviso to section 2(15) of the Act.

8. Departmental Representative submits that assessees gross receipts exceed more than `10,00,000/- and the activities of the assessee fall under general public utility and since in view of the proviso to section 2(15) of the Act, the assessee lost its character of charitable organization and thereby not eligible for exemption under section 11 of the Act. Departmental Representative submits that assessee is treated as an AOP by the Assessing Officer rightly. Departmental Representative further submits that whether ITA Nos.1932 to 1934/Mds/2014 proviso to section 2(15) of the Act applies or is not decided by the Commissioner of Income Tax (Appeals).

9. Counsel for the assessee submits that gross payments are more than gross receipts during this assessment year and there is no taxable income at all. In such circumstances, the issue as to whether the assessees activities fall under general public utility and the proviso to section 2(15) applies or not is only academic. The counsel further submits that since tax effect is Nil, the Revenue should not have filed any appeal in view of the circular No.3 of 2011 dated 9.2.2011.

10. Heard both sides. Perused orders of lower authorities. The assessee filed return of income for the assessment year 2009-10 on 29.9.2009 admitting Nil income. The return was processed under section 143(1) of the Act on 6.2.2011. The case was selected for scrutiny and notice under section 143(2) was issued on 14.9.2010 and assessment under section 143(3) was completed on 30.12.2011 by the Assessing Officer treating the assessee as an AOP for this ITA Nos.1932 to 1934/Mds/2014 assessment year holding that assessee lost its character of charitable organization and not eligible for exemption under section 11 of the Act. Since the activities of the assessee fall within the ambit of amended provisions of Section 2(15) of the Act, the Assessing Officer held that assessees object is of general public utility and the activities of the assessee are in the nature of rendering service in respect of trade, commerce or business and therefore in view of the first proviso to section 2(15) of the Act, assessee is not entitled for exemption under section 11 of the Act. The Commissioner of Income Tax (Appeals) while disposing off the appeal for the assessment year 2009-10 along with assessment years 2005-06 & 2006-07 in his common order held that assessee is eligible for exemption under section 11 & 12 of the Act in view of the decision of this Tribunal in assessees own case in ITA No.2118 & 2119/Mds/2010 dated 30.08.2011 for the assessment years 2003-04 and 2004-05, wherein this Tribunal granted registration to the assessee under section 12 of the Act. On a perusal of the orders of this Tribunal and the orders of lower authorities for this assessment year 2009- ITA Nos.1932 to 1934/Mds/2014 10, we are of the view that Commissioner of Income Tax (Appeals) failed to note that the facts in appeals before him for the assessment years 2005-06 and 2006-07 are not similar to that of assessment year 2009-10. Provisions of section 2(15) was amended with effect from 1.4.2009 which are applicable to assessment year 2009-10, wherein a proviso was inserted. The Commissioner of Income Tax (Appeals) while disposing off the appeal for the assessment year 2009-10 did not go into the proviso to section 2(15) of the Act especially when the assessee is receiving various receipts for various services rendered by it. The Commissioner of Income Tax (Appeals) has not examined as to whether the assessees activities fall under general public utility and whether they fall within the ambit of amended provisions of section 2(15) of the Act. Without examining these, Commissioner of Income Tax (Appeals) held that assessee is entitled for exemption under section 11 of the Act by mistakenly following the orders of this Tribunal for the assessment years 2003-04 & 2004-05. Therefore, in our view, this appeal has to be restored to the file of the ITA Nos.1932 to 1934/Mds/2014 Commissioner of Income Tax (Appeals) for deciding it afresh in accordance with law in the light our above findings. Therefore, we set aside the impugned order and restore this matter to the file of the Commissioner of Income Tax (Appeals) to decide it afresh and the assessee shall be given adequate opportunity of being heard.

11. In the result, appeal of the Revenue in ITA Nos. 1932 & 1933/Mds/2014 are dismissed and that of 1934/Mds/2014 is allowed for statistical purposes. Order pronounced in the open court on Friday, the 24 th day of October, 2014 at Chennai. Sd/- Sd/- ( . ) (( *+  ) ( A.Mohan Alankamony ) ( Challa Nagendra Prasad ) - / Accountant Member * - / Judicial Member */Chennai, //Dated 24 th October, 2014 somu  12 32/Copy to:

1. Appellant 2. Respondent

3. 4 ()/CIT(A) 4. 4/CIT

5. 2 7/DR 6.  /GF.