ARIHANTH CHARITABLE TRUST, Jaipur V. CIT(EXEMPTIONS), Jaipur

ITA 1052/JPR/2016

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 9662 (ITAT-JAIPUR)
• Duration Of Justice: 3 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-03-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 31-03-2017
• Assessment Year: misc
• Appeal Filed On: 01-12-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VARINDER MEHTA CIT DHK
• Keywords: Charitable institution
• Section: 12A; 12AA

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE S, JAIPUR JH DQY HKKJR] U;KF;D LNL; ,OA JH FOE FLAG ;KNO] YS [KK LNL; DS LE{K BEFORE: SHRI KUL BHARAT, JM & SHRI VIKRAM SINGH YAD AV, AM VK;DJ VIHY LA-@ ITA NO. 1052/JP/2016 M/S. ARIHANTH CHARITABLE TRUST, 402, GANPATI PLAZA, VEER DURGA DAS NAGAR, PALI. CUKE VS. THE COMMISSIONER OF INCOME TAX (EXEMPTIONS) JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN NO. AAFTA 2605 Q VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI P.C. PARWAL (CA) JKTLO DH VKSJ LS@ REVENUE BY : SHRI VARINDER MEHTA CIT) LQUOKBZ DH RKJH[K@ DATE OF HEARING : 31.03.2017. ?KKS'K .KK DH RKJH[K@ DATE OF PRONOUNCEMENT : 31/03/2017. VKNS'K@ ORDER PER SHRI KUL BHARAT, JM. THE APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF LD. CIT (EXEMPTIONS), JAIPUR DATED 02.11.2016. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL :- 1. THE LD. CIT HAS ERRED ON FACTS AND IN LAW IN R EJECTING THE APPLICATION OF ASSESSEE FOR GRANT OF REGISTRATION U /S 12AA OF INCOME TAX ACT, 1961 FOR THE REASON THAT ASSESSEE T RUST IS NEITHER REGISTERED BEFORE CONCERNED SUB REGISTRAR N OR BEFORE THE ASSISTANT COMMISSIONER OF DEVSTHAN VIBHAG AND T HUS IT CANNOT BE HELD AS VALID LEGAL TRUST IGNORING THAT T HE SAME IS NOT A CONDITION PRECEDENT FOR GRANT OF REGISTRATION U/S 12AA. 2. THE ASSESSEE CRAVES TO AMEND, ALTER AND MODIFY ANY OF THE GROUNDS OF APPEAL 3. NECESSARY COST BE ALLOWED TO THE ASSESSEE. 2 ITA NO. 1052/JP/2016 ARIHANTH CHARITABLE TRUST 2. BRIEFLY STATED THE FACTS OF THE CASE ARE THAT TH E ASSESSEE HAD FILED AN APPLICATION ON 17.05.2016 IN FORM NO. 10A FOR SEEKI NG REGISTRATION UNDER SECTION 12AA OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFER RED TO AS THE ACT). THE SAID APPLICATION WAS REJECTED BY THE LD. CIT (EXEMPTIONS ) ON THE GROUND THAT IN THE STATE OF RAJASTHAN THE ASSESSEE TRUST HAS NOT COME INTO E XISTENCE THROUGH A LEGAL DOCUMENT BY GETTING IT REGISTERED BEFORE THE COMPET ENT AUTHORITY WITHIN THE PRESCRIBED TIME LIMIT. IN THE CASE OF THE APPLICAN T TRUST IT IS NEITHER REGISTERED BEFORE THE CONCERNED SUB REGISTRAR NOR BEFORE THE ASSISTAN T COMMISSIONER OF DEVSTHAN VIBHAG. AGGRIEVED, THE ASSESSEE IS IN PRESENT APPE AL BEFORE THIS TRIBUNAL. 3. THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE DECISION OF THE LD. CIT (EXEMPTIONS) IS CONTRARY TO THE DECISION OF THE COO RDINATE BENCH OF THE TRIBUNAL RENDERED IN THE CASE OF TSURPHU LABRANG VS. DIRECTO R OF INCOME TAX (EXEMPTIONS), (2016) 159 ITD 848 (DELHI). HE SUBMITTED THAT THER E IS NO SUCH REQUIREMENT UNDER THE INCOME TAX ACT THAT THE TRUST IS REQUIRED TO BE REGISTERED UNDER THE RELEVANT LAW OF THE STATE. HE SUBMITTED THAT IN THE PRESENT CASE THE TRUST IS CREATED THROUGH A DOCUMENT DULY NOTARIZED. THEREFORE, HE SUBMITTED T HAT FOR THE PURPOSE OF REGISTRATION UNDER THE IT ACT, THE NOTARIZED DOCUME NT IS SUFFICIENT. 3.1 ON THE CONTRARY, THE LD. D/R OPPOSED THE SUBMIS SIONS AND SUBMITTED THAT THE TRUST WOULD INTO EXISTENCE IF IT IS REGISTERED AS P ER THE LAW. 3.2. WE HAVE HEARD RIVAL CONTENTIONS, PERUSED THE M ATERIAL AVAILABLE ON RECORD AND GONE THROUGH THE ORDER OF LD. CIT (EXEMPTIONS). WE FIND THAT UNDER THE IDENTICAL FACTS, THE COORDINATE BENCH OF THE TRIBUN AL IN ITA NO. 4941/DEL/2011 & 3061/DEL/2013 HAS HELD AS UNDER :- 3 ITA NO. 1052/JP/2016 ARIHANTH CHARITABLE TRUST 13. A PLAIN READING OF RULE 17A(A) MAKES IT CLEAR THAT WHERE THE TRUST IS CREATED, OR THE INSTITUTION IS ESTABLISHED, UNDE R AN INSTRUMENT, THE INSTRUMENT IN ORIGINAL, TOGETHER WITH ONE COPY THER EOF, HAS TO BE FILED ALONG WITH PRESCRIBED FORM NO.10A FOR REGISTRATION OF THE INSTITUTION/TRUST U/S 12A OF THE ACT. HOWEVER, THE SECOND LIMB OF RULE 17A(A) PROVIDES THAT WHERE THE TRUST IS CREATED, OR THE INSTITUTION IS ESTABLISHED, OTHERWISE THAN UNDER AN INSTRUMENT, TH E DOCUMENT EVIDENCING THE CREATION OF THE TRUST OR THE ESTABLI SHMENT OF THE INSTITUTION, TOGETHER WITH ONE COPY THEREOF, HAS TO BE FILED ALONG WITH THE STATUTORY FORM NO.10A FOR REGISTRATION OF THE I NSTITUTION/TRUST U/S12AA/12A OF THE ACT. THUS, THE APPLICABLE RULE 1 7A ITSELF PROVIDES THAT IT IS NOT NECESSARY THAT THE INSTITUTION/TRUST SHOULD BE ESTABLISHED UNDER AN INSTRUMENT. THE RULE 17A DOES NOT PRESCRIB E THAT IN CASE THE INSTITUTION/TRUST IS ESTABLISHED OTHERWISE THAN UND ER AN INSTRUMENT, WHAT TYPE OF DOCUMENT EVIDENCING THE CREATION OF TH E TRUST OR THE ESTABLISHMENT OF THE INSTITUTION, HAS TO BE FILED, MEANING THEREBY THAT THE DOCUMENT EVIDENCING THE CREATION OF TRUST OR TH E ESTABLISHMENT OF INSTITUTION COULD BE OF ANY TYPE. AS PER THE PROVIS IONS OF THE INDIAN TRUST ACT, THE TRUST CAN BE CREATED EVEN ORALLY AND IF THE ASSESSEE IS ABLE TO GIVE SOME EVIDENCE OF CREATION OF SUCH TRUS T BY A WORD OF MOUTH, THE SAME SHALL BE ELIGIBLE FOR REGISTRATION U/S 12AA/12A OF THE ACT, PROVIDED SUCH EVIDENCE IS FILED AND THE OTHER CONDITIONS UNDER THE STATUTE ARE SATISFIED. IN VIEW OF THE DECISION OF THE COORDINATE BENCH, WE DEEM IT PROPER TO RESTORE THIS APPEAL OF THE ASSESSEE BEFORE THE LD. CIT (EXEMPTIO NS) TO DECIDE IN ACCORDANCE WITH LAW LAID DOWN BY THE COORDINATE BENCH. 4. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 31 /03/2017 . SD/- SD/- FOE FLAG ;KNO ( DQY HKKJR ) (VIKRAM SINGH YADAV) ( KUL BHARAT ) YS[KK LNL;@ ACCOUNTANT MEMBER U;KF;D LNL;@ JUDICIAL MEMBER JAIPUR DATED:- 31 /03/2017. POOJA 4 ITA NO. 1052/JP/2016 ARIHANTH CHARITABLE TRUST VKNS'K DH IZFRFYFI VXZSF'KR@ COPY OF THE ORDER FORWARDED TO: 1. THE APPELLANT- M/S. ARIHANTH CHARITABLE TRUST, PALI. 2. THE RESPONDENT- THE CIT (EXEMPTIONS), JAIPUR. 3. THE CIT, 4. THE CIT (A) 5. THE DR, ITAT, JAIPUR 6. GUARD FILE (ITA NO. 1052/JP/2016) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASSISTANT. REGISTRAR