Maharishi Mahesh Yogi Vedic, V. Commissioner of Income tax-II,

ITA 116/JAB/2014

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 2149 (ITAT-JABALPUR)
• Duration Of Justice: 3 year(s) 3 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-11-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: misc
• Appeal Filed On: 28-07-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 12AA

Judgement Text

I.T.A. NO. 116 /JAB/201 4 ASSESSMENT YEAR:N.A. 1 IN THE INCOME TAX APPELLATE TRIBUNAL JABALPUR BENCH, JABALPUR BEFORE SHRI MANISH BORAD, ACCOUNTANT MEMBER AND SHRI PARTHA SARATHI CHAUDHURY, JUDICIAL MEMBER I.T.A. NO.116/JAB/2014 ASSESSMENT YEAR:N.A. MAHARISHI MAHESH YOGI VEDIC VISHWAVIDYALAYA, VILLAGE LAMTI, VIJAY NAGAR, JABALPUR. PAN:AAAJM 1070 C VS. C.I.T. - II, JABALPUR. (APPELLANT) (RESPONDENT) O R D E R PER MANISH BORAD, A.M. THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST TH E ORDER OF CIT-II, JABALPUR DATED 29/05/2014. THE ASSESSEE HAS RAISED SEVEN GROUND OF APPEAL BUT THE SOLE GRIEVANCE IS AGAINST THE ORDER OF CIT NOT GRANTING APPROVAL FOR REGISTRATION U/S 12AA OF THE ACT. 2. BRIEFLY STATED, THE FACTS AS CULLED OUT FROM THE RECORDS, ARE THAT THE THE SOCIETY IS REGISTERED BY THE M.P. STATE GOVERNM ENT REGISTRATION ACT APPELLANT BY DR. H. S. MOTH, ADVOCATE SHRI SACHIN BAJPAI, ADVOCATE RESPONDENT BY SHRI V. B. SARGAR, D. R. DATE OF HEARING 08/11/2017 DATE OF PRONOUNCEMENT 09 /11/2017 I.T.A. NO. 116 /JAB/201 4 ASSESSMENT YEAR:N.A. 2 AS PER GAZETTE NOTIFICATION NO.37 OF 1995. THE ASS ESSEE FILED APPLICATION FOR REGISTRATION U/S 12AA ON 18/11/2013 WITH NECESS ARY ENCLOSURES. LEARNED CIT OBSERVED THAT THE SOCIETY IS REGULARLY EARNING HUGE INCOME AND THE GROSS SURPLUS FOR FINANCIAL YEAR 2010-11, 2 011-12 AND 2012-13 WERE APPROX. RS.6.25 CR., RS.6.02 CR. AND RS.21.86 CR. CERTAIN INFORMATION WERE CALLED ABOUT THE ACTIVITIES, FEES CHARGED FROM THE STUDENTS AND EVIDENCE PROVING THAT THE SOCIETY IS P ERFORMING CHARITABLE ACTIVITIES. IN REPLY THERETO, THE SOCIETY SUBMITTE D THE DETAILS OF STUDENTS ENROLLED IN BASIC COURSE TO WHOM FEES CONCESSION WA S ALLOWED. THE DETAILS OF OTHER STUDENTS, FEES RECEIVED THEREFROM WERE NOT PROVIDED TO LEARNED CIT. LOOKING TO THESE FACTS, THE CIT WAS O F THE VIEW THAT THE CLAIM OF SOCIETY BEING A NON PROFIT EDUCATIONAL INS TITUTION, PER SE , PROVIDING EDUCATION CANNOT BE TREATED AS DEED OF CH ARITY IN VIEW OF THE HUGE SURPLUS EARNED CONSISTENTLY FOR LAST SO MANY Y EARS. HE ACCORDINGLY APPLIED THE DECISION OF MADRAS TRIBUNAL IN CASE OF RAJAH SIR ANNAMALAI CHETTIAR FOUNDATION VS. DIRECTOR OF INCOME-TAX (EXE MPTIONS) AND REJECTED THE APPLICATION FILED BY THE ASSESSEE U/S 12AA OF THE ACT. 3. AGGRIEVED, THE ASSESSEE IS NOW IN APPEAL BEFORE THE TRIBUNAL. AT THE OUTSET, LEARNED COUNSEL FOR THE ASSESSEE SUBMIT TED THAT THE SOCIETY IS INCORPORATED IN PURSUANCE TO THE GAZETTE NOTIFIC ATION ISSUED BY THE M.P. STATE GOVERNMENT, HIGHER EDUCATION DEPARTMENT, BHOPAL VIDE ORDER DATED 19/12/95. IT HAS BEEN REGISTERED AS UNIVERSI TY IN THE NAME MAHARISHI MAHESH YOGI VADIC VISHWAVIDYALAYA. HE FU RTHER PLEADED THAT THE INCOME OF SUCH UNIVERSITY RUNNING SOLELY FOR ED UCATION PURPOSES AND APPROVED BY PRESCRIBED AUTHORITY WHICH IN THIS CASE IS STATE GOVERNMENT OF M.P., THE INCOME IS EXEMPT UNDER U/S 10(23C) OF THE ACT. LEARNED I.T.A. NO. 116 /JAB/201 4 ASSESSMENT YEAR:N.A. 3 COUNSEL FOR THE ASSESSEE REFERRED TO THE PAPER BOOK RUNNING FROM PAGE 1 TO 65 AND SUBMITTED THAT THE CIT FAILED TO APPRECIA TE THIS FACT IN RIGHT PERSPECTIVE DENYING APPROVAL FOR REGISTRATION U/S 1 2AA OF THE ACT. 4. ON THE OTHER HAND LEARNED D.R. SUPPORTED THE ORD ER OF LEARNED CIT. 5. WE HAVE HEARD RIVAL CONTENTIONS AND PERUSED THE RECORD PLACED BEFORE US. THE ASSESSEE IS AGGRIEVED WITH THE ORD ER OR CIT NOT GRANTING APPROVAL U/S 12AA OF THE ACT. WE OBSERVE THAT CIT REJECTED THE APPLICATION U/S 12AA ON THE PREMISE OF HIS OBSERVAT ION THAT THE SOCIETY IS RUNNING FOR PROFIT MOTIVE AND NOT PROVIDING CHARITA BLE SERVICES. WE HOWEVER FIND THAT THE SOCIETY IS REGISTERED BY THE M.P. STATE GOVERNMENT UNDER THE GAZETTE NOTIFICATION PLACED AT PAGES 4 TO 28 OF THE PAPER BOOK AND THE SOCIETY IS AN UNIVERSITY RUNNING UNDER THE APPROVAL OF THE M.P. STATE GOVERNMENT. THIS FACT IS NOT DISPUTED BY REV ENUE. WE AGREE TO THE FACT THAT SOME OF THE DETAILS WHICH WERE CALLED FOR BY CIT WERE NOT PROVIDED BY THE ASSESSEE DURING THE COURSE OF PROCE EDINGS. FURTHER CIT HAS MADE SPECIFIC OBSERVATION ABOUT THE APPLICATION OF INCOME TOWARDS THE COST OF ITS ASSETS BUT MERELY FOR APPLYING THE SURPLUS FROM ACTIVITIES CARRIED OUT DURING THE YEAR TOWARDS INVESTMENT IN F IXED ASSETS, PER SE , CANNOT PROVE THAT THE ASSESSEE IS NOT ENGAGED IN CH ARITABLE ACTIVITIES. 5.1 IN THE LIGHT OF ABOVE OBSERVATIONS, WE OBSERVE THAT CIT HAS REJECTED THE APPLICATION U/S 12AA WITHOUT CONSIDERI NG RELEVANT FACTS, FINANCIAL STATEMENTS, GAZETTE NOTIFICATION OF STATE GOVERNMENT AND EXAMINING THE ACTIVITIES CARRIED OUT BY THE ASSESSE E IN DETAIL. BOTH THE I.T.A. NO. 116 /JAB/201 4 ASSESSMENT YEAR:N.A. 4 PARTIES HAVE NO OBJECTION IF THE ISSUE RAISED IN TH IS APPEAL IS REMITTED BACK TO THE FILE OF THE CIT FOR DE NOVO ADJUDICATIO N. 5.2 WE, THEREFORE, IN THE GIVEN FACTS AND CIRCUMSTA NCES OF THE CASE AND IN VIEW OF OUR OBSERVATION IN THE PRECEDING PAR AS, FIND IT JUSTIFIED TO REMIT THE ISSUE RAISED IN THIS APPEAL RELATING TO R EGISTRATION U/S 12AA TO THE FILE OF THE CIT FOR DECIDING AFRESH. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED FOR STATISTICAL PURPOSES. (ORDER WAS PRONOUNCED IN THE OPEN COURT ON 09/11/2 017 SD/. SD/. (PARTHA SARATHI CHAUDHURY) (MANISH BORAD) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED:09/11/2017 *SINGH COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT. 3. CONCERNED CIT 4. THE CIT(A) 5. D.R., ASST T. REGISTRAR