M/s.Salagramam Public charitable trust, Trivandrum V. CIT, Trivandrum

ITA 112/COCH/2012

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 2601 (ITAT-COCHIN)
• Duration Of Justice: 1 year(s) 4 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-07-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 22-07-2013
• Assessment Year: misc
• Appeal Filed On: 19-03-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S VIJAYAPRABHA
• Assessee Lawyers: R KRISHNAN
• Keywords: Charitable institution
• Section: 12AA

Judgement Text

1 ITA NO.112/COCH/2012 IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH, COCHIN BEFORE SHRI N.R.S. GANESAN (JM) AND SHRI B.R. BASKA RAN(AM) I.T.A NO. 112/COCH/2012 SALAGRAMAM PUBLIC CHARITABLE TRUST VS THE C.I.T, T RIVANDRUM KUNDAMANKADAVU THIRUMALA P.O TRIVANDRUM 695 006 PAN : AAKTS6355A (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI R KRISHNAN RESPONDENT BY : SMT. S VIJAYAPRABHA DATE OF HEARING : 22-07-2013 DATE OF PRONOUNCEMENT : 31-07-2013 O R D E R PER N.R.S. GANESAN (JM) THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST TH E ORDER OF ADMINISTRATIVE COMMISSIONER DATED 19 TH JANUARY, 2012 REJECTING THE APPLICATION FOR REGISTRATION U/S 12AA OF THE ACT. 2. SHRI R KRISHNAN, THE LD.REPRESENTATIVE FOR THE A SSESSEE SUBMITTED THAT THE ADMINISTRATIVE COMMISSIONER FOUND THAT THE TRUST WAS CARRYING ON BUSINESS ACTIVITIES LIKE SALE OF CDS, BOOKS, MAGAZI NES AND CONDUCTING 2 ITA NO.112/COCH/2012 YOGA CLASSES. ACCORDING TO THE LD.REPRESENTATIVE, IT IS NOT KNOWN WHERE FROM THE ADMINISTRATIVE COMMISSIONER GOT THIS INFOR MATION. THE LD.REPRESENTATIVE FURTHER SUBMITTED THAT THE ASSESS EE IS NOT DOING ANY ACTIVITY OF SALE OF CDS, BOOKS, MAGAZINES AND CONDU CTING YOGA CLASSES. THE LD.REPRESENTATIVE FURTHER SUBMITTED THAT THE AS SESSEE IS DISTRIBUTING FREE SCHOOL UNIFORMS AND BAGS TO THE STUDENTS. THE ASSESSEE ALSO AWARDS SCHOLARSHIPS TO THE STUDENTS. THE ASSESSEE ALSO IN CURRED EXPENDITURE IN PROVIDING FREE EDUCATION, ANNADANAM, ETC. UNFORTUN ATELY, ACCORDING TO THE LD.REPRESENTATIVE, THIS MATTER WAS NOT CONSIDERED B Y THE COMMISSIONER EVEN THOUGH IT WAS BROUGHT TO HER NOTICE. 3. ON THE CONTRARY, SMT. S VIJAYAPRABHA, THE LD.DR SUBMITTED THAT THE ASSESSEE IS ENGAGED IN THE BUSINESS LIKE SALE OF CD S, BOOKS, MAGAZINES AND CONDUCTING YOGA CLASSES, ETC. THEY ARE ALSO CO NDUCTING RELIGIOUS TOURS. THE ASSESSEE IS ALSO ORGANIZING TOURS IN AB ROAD. THE AMOUNT RECEIVED WAS NOT SPENT FOR CHARITABLE ACTIVITIES. THEREFORE, ACCORDING TO THE LD.DR, THE ADMINISTRATIVE COMMISSIONER HAS RIGH TLY REJECTED THE CLAIM OF THE ASSESSEE. 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITH ER SIDE AND ALSO PERUSED THE MATERIAL AVAILABLE ON RECORD. ON ENQUI RY, IT APPEARS THAT THE ADMINISTRATIVE COMMISSIONER FOUND THAT THE ASSESSEE TRUST IS CONDUCTING 3 ITA NO.112/COCH/2012 RELIGIOUS TOURS AND IS INDULGING IN ACTIVITIES LIKE SALE OF CDS, BOOKS, MAGAZINES AND CONDUCTING YOGA CLASSES. BUT THIS IS DISPUTED BY THE LD.REPRESENTATIVE FOR THE ASSESSEE. ACCORDING TO T HE LD.REPRESENTATIVE, THE ASSESSEE IS NOT CONDUCTING ANY BUSINESS ACTIVITY AN D THEY ARE NOT SELLING ANY CDS, BOOKS, MAGAZINES AND CONDUCTING YOGA CLASS ES. FROM THE ORDER OF THE COMMISSIONER IT APPEARS THAT THE AMOUNT RECE IVED ON SALE OF CDS, BOOKS, MAGAZINES AND CONDUCTING YOGA CLASSES WAS AC COUNTED FOR AS IF IT WAS A DONATION. SINCE THE ASSESSEE IS DISPUTING TH IS FACT, IT IS INCUMBENT UPON THE ADMINISTRATIVE COMMISSIONER TO BRING ON RE CORD THE BASIS ON WHICH SHE CAME TO THE CONCLUSION THAT THE ASSESSEE WAS CONDUCTING BUSINESS ACTIVITY AS OBSERVED BY HER IN THE IMPUGNE D ORDER. THE ASSESSEE HAS FILED PAPER BOOK DISCLOSING CERTAIN PHOTOGRAPHS AND RECEIPTS AS ALSO THE PAYMENT ACCOUNT. IN THE INCOME AND EXPENDITURE ACCOUNT FOR THE PERIOD ENDED 31-03-2011, THE ASSESSEE IS SHOWING DO NATION OF RS.93,973. HOWEVER, THE SOURCES OF THE DONATION ARE NOT DOWN. THE OBSERVATION MADE BY THE COMMISSIONER IS THAT THE AMOUNT RECEIVE D ON BUSINESS ACTIVITY IS SHOWN AS DONATION. THE ASSESSEE HAS AL SO CLAIMED THAT THEY HAVE INCURRED EXPENDITURE IN CHARITABLE ACTIVITY AN D THE LIST OF BENEFICIARIES IS GIVEN IN THE PAPER BOOK WHICH INDICATES THAT SCH OOL UNIFORMS WERE DISTRIBUTED TO THE POOR AND NEEDY CHILDREN. COPIES OF SOME PHOTOGRAPHS HAVE ALSO FILED TO SHOW THAT THEY HAVE DISTRIBUTED BOOKS, BAGS ETC. UNFORTUNATELY, THIS WAS NOT EXAMINED BY THE COMMISS IONER WHILE DECIDING 4 ITA NO.112/COCH/2012 THE MATTER. THEREFORE, THIS TRIBUNAL IS OF THE CON SIDERED OPINION THAT THE COMMISSIONER SHALL RECONSIDER THE ISSUE AFRESH IN T HE LIGHT OF THE MATERIAL FILED BY THE ASSESSEE TO INDICATE THE ACTIVITIES TH AT WAS SAID TO HAVE BEEN CARRIED OUT BY THE ASSESSEE. ACCORDINGLY, THE ORDE R OF THE COMMISSIONER IS SET ASIDE AND THE ISSUE IS REMITTED BACK TO THE FILE OF THE COMMISSIONER. THE COMMISSIONER SHALL RE-EXAMINE THE MATTER IN THE LIGHT OF THE MATERIAL AVAILABLE ON RECORD AND THEREAFTER DECIDE THE SAME IN ACCORDANCE WITH LAW AFTER GIVING REASONABLE OPPORTUNITY OF HEARING TO T HE ASSESSEE. THE COMMISSIONER SHALL BRING ON RECORD THE BASIS ON WHI CH SHE CAME TO THE CONCLUSION THAT THE RECEIPT ON SALE OF BOOKS AND CD S ARE ACCOUNTED FOR IN THE NAME OF DONATION. IF ANY EXPENDITURE IS INCURR ED OUTSIDE THE INDIAN TERRITORY, IT SHOULD ALSO BE BROUGHT ON RECORD AS T O HOW AND WHERE THE EXPENDITURE WAS INCURRED. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 31 ST JULY, 2013. SD/- SD/- (B.R. BASKARAN) (N.R.S. GANESAN) ACCOUNTANT MEMBER JUDICIAL MEMBER COCHIN, DT : 31 ST JULY, 2013 PK/- 5 ITA NO.112/COCH/2012 COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE COMMISSIONER OF INCOME-TAX 4. THE COMMISSIONER OF INCOME-TAX(A) 5. THE DR (TRUE COPY) BY ORDER ASSTT. REGISTRAR, INCOME-TAX APPELLATE TRIBUNAL, COCHIN BENCH