M/s Sadiya Educational & Charitable Trust, Shiralkoppa V. CIT, Davangere

ITA 1235/BANG/2011

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 63635 (ITAT-BANGALORE)
• Duration Of Justice: 9 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-09-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: misc
• Appeal Filed On: 09-12-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ETWA MUNDA CITIII
• Assessee Lawyers: S VENKATESAN
• Keywords: Charitable institution; Opportunity of being heard; Period of limitation
• Section: 12AA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL BANGALORE C BENCH, BANGALORE BEFORE SHRI N. BARATHVAJA SANKAR, VICE PRESIDENT AND SHRI N.V.VASUDEVAN, JUDICIAL MEMBER I.T.A.NO.1235(B)/2011 (ASSESSMENT YEAR : NA ) M/S SADIYA EDUCATIONAL & CHARITABLE TRUST, MATTADGADE ROAD, SADIYA NAGAR, SHIRALKOPPA-577 428 PAN NO.AAKTS8671H APPELLANT VS THE COMMISSIONER OF INCOME-TAX, DAVANAGERE. RESPONDENT ASSESSEE BY : SHRI S. VENKATESAN, CA REVENUE BY : SHRI ETWA MUNDA, CIT-III DATE OF HEARING : 12 -09-2012 DATE OF PRONOUNCEMENT : 12- 09-2012 O R D E R PER SHRI N.V.VASUDEVAN, JM: THIS IS AN APPEAL BY THE ASSESSEE AGAINST THE ORDE R DATED 28- 09-2011 OF CIT, DAVANAGERE, REFUSING REGISTRATION T O THE APPELLANT U/S 12AA OF THE IT ACT, 1961. 2. THE ASSESSEE IS A TRUST. IT FILED AN APPLICATION FOR GRANT OF REGISTRATION U/S 12A(A) OF THE IT ACT, 1961 (THE A CT) THE APPLICATION WAS FILED ON 30-03-2011. THE HEARING O F THE APPLICATION WAS HELD ON 13-09-2011, 15-09-2011 AND 28-09-2011. ACCORDING TO THE CIT, THE ASSESSEE DID NOT PROVIDE DETAILS OF THE DONORS. FURTHER, THE CIT WAS OF THE VIEW, THAT SOME OF THE OBJECTS OF THE ITA NO.1235(B)/2011 2 ASSESSEE WERE FOR THE BENEFIT OF A PARTICULAR RELIG IOUS COMMUNITY. THE CIT WAS THEREFORE OF THE VIEW THAT THE TRUST HA S NOT FULFILLED THE CONDITIONS LAID DOWN FOR GRANT OF REGISTRATION U/S 12AA OF THE IT ACT, 1961. ACCORDINGLY, THE APPLICATION FOR GRANT O F REGISTRATION WAS REJECTED BY THE CIT. 3. AGGRIEVED BY THE ORDER OF THE CIT, THE ASSESSEE HAS FILED THE PRESENT APPEAL BEFORE THE TRIBUNAL. 4. WE HAVE HEARD THE SUBMISSIONS OF THE LEARNED CO UNSEL FOR THE ASSESSEE AND THE LEARNED DR. THE LEARNED COUNSEL F OR THE ASSESSEE POINTED OUT THAT THERE WAS LACK OF PROPER OPPORTUNI TY OF BEING HEARD TO THE ASSESSEE, BECAUSE THE CASE WAS FIXED F OR HEARING TOWARDS THE END OF SIX MONTHS PERIOD WITHIN WHICH THE ORDER U/S 12A(A) OF THE ACT HAS TO BE PASSED. FURTHER, LEAR NED COUNSEL FOR THE ASSESSEE ALSO SUBMITTED THAT THE OBSERVATIONS O F THE CIT THAT THE TRUST EXISTS FOR THE BENEFIT OF A PARTICULAR CO MMUNITY, EVEN ASSUMING THE SAME TO BE CORRECT, WILL NOT BE A GROU ND TO REFUSE REGISTRATION TO THE ASSESSEE. IN THIS REGARD, OUR A TTENTION WAS DRAWN TO THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF CIT VS AHMEDABAD RANA CASTE ASSOCIATION REPORTED IN 140 ITR 1, WHEREIN IT WAS HELD THAT WHERE THE TRUST EXISTS FOR THE BENEFIT OF A PARTICULAR COMMUNITY WHICH IS CROSS SECTION OF THE GENERAL PUBLIC, THEN THE TRUST HAS TO BE CONSIDERED AS EXISTING FOR CHARITABLE PURPOSE, ESPECIALLY WHEN THE BENEFICIARIES ARE POOR WOMEN AND CHILDREN OF A PARTICULAR COMMUNITY. 4.1 THE LEARNED DR SUPPORTED THE ORDER OF THE CIT. 5. AFTER CONSIDERING THE RIVAL SUBMISSIONS, WE ARE OF THE VIEW THAT IT WOULD BE JUST AND APPROPRIATE TO SET ASIDE THE O RDER OF CIT AND REMAND THE QUESTION OF GRANT OF REGISTRATION U/S 12 A(A) OF THE ACT TO THE CIT FOR FRESH CONSIDERATION. WE ARE OF THE VIE W THAT THERE WAS ITA NO.1235(B)/2011 3 LACK OF PROPER OPPORTUNITY OF BEING HEARD TO THE AS SESSEE IN AS MUCH AS THE HEARING OF THE APPLICATION TOOK PLACE T OWARDS THE END OF THE PERIOD OF LIMITATION FOR PASSING AN ORDER U/ S 12A(A) OF THE ACT. A PERUSAL OF THE IMPUGNED ORDER ALSO SHOWS TH AT THE ASSESSEE WAS NOT CONFRONTED WITH THE VIEW OF THE CIT CERTAIN OBJECTS OF THE ASSESSEE TRUST WERE NOT CHARITABLE, AS THE BENEFICI ARIES WERE OF A PARTICULAR COMMUNITY. WE THEREFORE, SET ASIDE THE IMPUGNED ORDER OF CIT AND REMAND THE ISSUE FOR GRANT OF REGISTRATI ON TO THE CIT FOR FRESH CONSIDERATION. THE ASSESSEE WILL BE AT LIBERT Y TO PUT FORTH ALL ITS CONTENTIONS WITH REGARD TO THE GRANT OF REGISTR ATION. THE CIT SHALL AFFORD AN OPPORTUNITY OF BEING HEARD TO THE A SSESSEE AND DECIDE THE MATTER AFRESH. 6. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 12 TH DAY OF SEPT., 2012. SD/- SD/ - (N. BARATHVAJA SANKAR) (N.V.VASUDEVAN) VICE PRESIDENT JUDICIAL MEMBER PLACE: BANGALORE DATED: 12-09-2012 AM* COPY TO : 1. THE ASSESSEE 2. THE REVENUE 3. CIT(A) 4. CIT 5. DR 6. GF(BLORE) 7. GF(DELHI) BY ORDER SR. PRIVATE SECRETARY, ITAT, BANGALORE