Sri Chukkapalli Pitchaiah Foundation, Vijayawada V. THE CIT(EXAMPTIONS), Hyderabad

ITA 126/VIZ/2016

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 6660 (ITAT-VISAKHAPATNAM)
• Duration Of Justice: 1 year(s) 6 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-10-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: misc
• Appeal Filed On: 17-03-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: R GOVINDA RAJU
• Keywords: Charitable institution
• Section: 80G; 12AA

Judgement Text

ITA NO.126/VIZAG/2016 SRI CHUKKAPALLI PITCHAIAH FOUNDATION, VIJAYAWADA 1 , , IN THE INCOME TAX APPELLATE TRIBUNAL, VISAKHAPATNAM BENCH, VISAKHAPATNAM . , . . ' , % BEFORE SHRI V. DURGA RAO, JUDICIAL MEMBER & SHRI D.S. SUNDER SINGH, ACCOUNTANT MEMBER ./I.T.A.NO.126/VIZAG/2016 ( / ASSESSMENT YEAR: N.A.) SRI CHUKKAPALLI PITCHAIAH FOUNDATION VIJAYAWADA CIT(EXEMPTIONS) HYDERABAD [PAN NO. AAPTS5545M ] ( ' / APPELLANT) ( ()' / RESPONDENT) / APPELLANT BY : SHRI I. KAMA SASTRY, A.R. / RESPONDENT BY : SHRI R. GOVINDA RAJU, DR / DATE OF HEARING : 10.10.2017 / DATE OF PRONOUNCEMENT : 13.10.2017 / O R D E R PER D.S. SUNDER SINGH, ACCOUNTANT MEMBER: THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAI NST ORDER OF THE COMMISSIONER OF INCOME TAX (EXEMPTIONS) {CIT}, HYDERABAD FOR REFUSAL OF REGISTRATION U/S 12AA OF THE INCOME TAX ACT, 1961 (HEREINAFTER CALLED AS 'THE ACT') AND APPROVAL U/S 80G OF THE AC T VIDE F.NO.CIT(E)/87(6)/HYD/12A/2015-16 DATED 31.12.2015. ITA NO.126/VIZAG/2016 SRI CHUKKAPALLI PITCHAIAH FOUNDATION, VIJAYAWADA 2 2. ASSESSEE FILED APPLICATION IN FORM NO.10A FOR GR ANT OF REGISTRATION U/S 12AA OF THE ACT AND FOR APPROVAL U/S 80G OF THE ACT. THE CIT HAS GONE THROUGH THE INFORMATION FILED BY THE ASSESSEE AND SOME OF THE OBJECTIVES OF THE TRUST WHICH READS AS UNDER: A) TO HONOUR OUTSTANDING PERSONALITIES AND THOSE W HO HAVE CONTRIBUTED IN GREAT MEASURES TO ENTREPRENEURSHIP, INDUSTRY, CO MMERCE, ECONOMICS, SCIENCE & TECHNOLOGY, INDIAN CULTURE, HERITAGE, FINE ARTS, LITERATURE, SPORTS SOCIAL SERVICE, INDIAN POLITY, MORAL CONDUCT , PHILOSOPHY OR ANY OTHER FIELD WHICH HAS AN IMPACT ON THE SOCIETY IN G ENERAL. B) TO AWARD A CITATION AND CASH PRIZE TO DESERVING INDIVIDUALS OR INSTITUTIONS WHO HAVE MADE A POSITIVE CONTRIBUTION TO THE SOCIETY AT LARGE. C) TO ORGANIZE AND ASSIST THE ORGANIZATION OF EVENT S OR LECTURES IN CONSONANCE WITH THE OBJECTS FOR WHICH THIS TRUST IS FOUNDED, IN CONSONANCE WITH THE OBJECTS FOR WHICH THIS TRUST IS FOUNDED, I N MEMORY OF LATE CHUKKAPALLI PITCHAIAH GARU. D) TO INCULCATE INTEREST, PROMOTE STUDY & APPRECIAT ION IN THE FIELDS OF ENTREPRENEURSHIP, INDUSTRY, COMMERCE, ECONOMICS, SC IENCE & TECHNOLOGY. 3. CIT(EXEMPTIONS) AFTER GOING THROUGH THE CLAUSES OF OBJECTIVES VIEWED THAT THE OBJECTIVE CLAUSES DOES NOT INDICATE THAT THEY ARE CHARITABLE IN NATURE AS REQUIRED U/S 2(15) OF THE A CT AND FURTHER THE ASSESSEE FAILED TO FURNISH THE PAN NO. IN FORM NO.1 0A. HENCE, THE CIT (EXEMPTIONS) HELD THAT THE TRUST IS NOT FIT FOR GRANT OF REGISTRATION U/S 12AA OF THE ACT, ACCORDINGLY, REJE CTED THE APPLICATION OF THE ASSESSEE TRUST. AGGRIEVED BY THE ORDER OF T HE CIT(EXEMPTIONS), THE ASSESSEE FILED APPEAL BEFORE T HIS TRIBUNAL. ITA NO.126/VIZAG/2016 SRI CHUKKAPALLI PITCHAIAH FOUNDATION, VIJAYAWADA 3 4. APPEARING FOR THE ASSESSEE, THE LD. AUTHORISED R EPRESENTATIVE (A.R.) SUBMITTED THAT THE ASSESSEE HAD FILED THE PA N NO. IN FORM NO.10A AND IT IS NOT CORRECT TO REJECT THE REGISTRA TION CITING NON FURNISHING OF PAN ALONG WITH FORM 10A. THOUGH, THE COPY OF FORM NO.10A WAS NOT PLACED BEFORE US, SINCE THE ASSESSEE HAS FURNISHED PAN NO. IN CHALLAN AND ASSESSEE IS HAVING ALLOTTED PAN NO., WE ALLOW THIS GROUND OF THE ASSESSE. 5. THE LD. A.R. EXPLAINED THAT THE CHUKKAPAL LI FOUNDATION IS ENGAGED IN THE ACTIVITIES OF ORGANIZATION SEMINARS AND GIVING AWARDS TO THE EMINENT PERSONALITIES TO HONOUR THEM, AND GI VING CASH AWARDS TO THE EMINENT PERSONS WHO MADE POSITIVE CONTRIBUTI ON TO THE SOCIETY AND ORGANIZING EVENTS OR LECTURES ON VARIOUS SUBJEC TS. IN SUPPORT THE LD. A.R. FILED TWO PROGRAMMES ORGANIZED BY THE FOUN DATION ON 8.8.2016 AND 7.8.2015 GIVING AWARD TO PROF. K.N. PH ANIKAR AND PROF. C.N. RAO EVIDENCING THE ACTIVITIES CARRIED OUT BY T HE ASSESSEE TRUST. THE LD. A.R. ARGUED THAT BY GIVING AWARDS, FELICITA TING THE EMINENT PEOPLE AND ORGANIZING THE PUBLIC DEBATES ON VARIOUS SUBJECTS THE FOUNDATION IS HELPING THE COUNTRY FOR PUBLIC GOOD A ND FALLS UNDER ANY OTHER PUBLIC UTILITY AND REQUESTED FOR GRANT OF THE REGISTRATION. ON THE OTHER HAND, THE LD. DR SUPPORTED THE ORDERS OF THE LD.CIT. ITA NO.126/VIZAG/2016 SRI CHUKKAPALLI PITCHAIAH FOUNDATION, VIJAYAWADA 4 6. WE HAVE HEARD BOTH THE PARTIES AND GONE THROUGH THE OBJECTIVES OF THE ASSESSEE, WE UNDERSTAND THAT NONE OF THE OBJECTIVES ARE CHARITABLE IN NATURE. THOUGH THE LD. A.R. ARGU ED THAT THE OBJECTIVES COME UNDER ANY OTHER PUBLIC UTILITY, BUT THE LD. A.R. FAILED TO DEMONSTRATE THAT THE OBJECTIVES ARE IN FACT CHAR ITABLE IN NATURE AND COVERED WITHIN THE MEANING OF CHARITABLE PURPOSE AS PER SECTION 2(15) OF THE ACT. FOR READY REFERENCE, WE EXTRACT SECTION 2(15) OF THE ACT, WHICH READS AS UNDER: 15 ) 68 'CHARITABLE PURPOSE' 69 INCLUDES RELIEF OF THE POOR, EDUCATION 69 , 69A [ YOGA, ] MEDICAL RELIEF, 70 [PRESERVATION OF ENVIRONMENT 69 (INCLUDING WATERSHEDS, FORESTS AND WILDLIFE) AND PRESERVATION OF MONUMENTS OR PLACES OR OBJECTS OF ARTISTIC OR HISTORIC INTEREST,] AND THE ADVANCEMENT OF ANY OTHER 69 OBJECT OF GENERAL PUBLIC UTILITY: PROVIDED THAT THE ADVANCEMENT OF ANY OTHER OBJECT OF GENERAL PUBLIC UTILITY SHALL NOT BE A CHARITABLE PURPOSE, IF IT INVOLVES THE CARRYIN G ON OF ANY ACTIVITY IN TH E NATURE OF TRADE, COMMERCE OR BUSINESS 69 , OR ANY ACTIVITY OF RENDERING ANY SERVICE IN RELAT ION TO ANY TRADE, COMMERCE OR BUSINESS 69 , FOR A CESS OR FEE OR ANY OTHER CONSIDERATION, IRRE SPECTIVE OF THE NATURE OF USE OR APPLICATION, OR RE TENTION, OF THE INCOME FROM SUCH ACTIVITY:] FURTHER, THE CHARITIES ACT, 2005 SAYS THAT THE CHA RITABLE PURPOSE MUST FALL UNDER ONE OR MORE CATEGORIES I.E. RELIEF OF POVERTY, ADVANCEMENT OF EDUCATION OR THE ADVANCEMENT OF RELI GION. THE LD. A.R. EXPLAINED THAT THE CHUKKAPALLI FOUNDATION IS E NGAGED IN THE ACTIVITIES OF ORGANIZATION SEMINARS AND GIVING AWAR DS TO THE EMINENT PERSONALITIES TO HONOUR THEM, AND GIVING CASH AWARD S TO THE PERSONS WHO MADE POSITIVE CONTRIBUTION TO THE SOCIETY AND O RGANIZING EVENTS OR LECTURES ON VARIOUS SUBJECTS. IN SUPPORT THE LD . A.R. ALSO FILED TWO ITA NO.126/VIZAG/2016 SRI CHUKKAPALLI PITCHAIAH FOUNDATION, VIJAYAWADA 5 PROGRAMMES ORGANIZED BY THE FOUNDATION ON 8.8.2016 AND 7.8.2015 GIVING AWARD TO PROF. K.N. PHANIKAR AND PROF. C.N. RAO. BUT GIVING AWARDS AND FELICITATING EMINENT PEOPLE AND ORGANIZI NG THE PUBLIC DEBATES ON VARIOUS SUBJECTS CANNOT BE HELD TO BE CH ARITABLE ACTIVITY FOR THE PURPOSE OF INCOME TAX ACT. THE SOLE ACTIVI TY OF ORGANIZING MEETINGS AND GIVING AWARDS TO EMINENT PEOPLE DO NOT FIT INTO THE DEFINITION OF CHARITABLE PURPOSE AS PER THE INCOME TAX ACT. THE LD. A.R. ALSO FAILED TO ESTABLISH AND DEMONSTRATE THAT THE OBJECTS AND THE ACTIVITY OF THE FOUNDATION IS COVERED BY THE DEFINI TION OF SECTION 2(15) OF THE ACT AND THE A.R. DID NOT PLACE ANY JUDICIAL DECISION SUPPORTING THE ASSESSEES ACTIVITY AS CHARITABLE PURPOSE, THER EFORE, WE DO NOT FIND ANY REASON TO INTERFERE WITH THE ORDER OF THE CIT(EXEMPTIONS) AND THE SAME IS UPHELD. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS DIS MISSED. THE ABOVE ORDER WAS PRONOUNCED IN THE OPEN COURT O N 13 TH OCT17. SD/- SD/- ( . ) ( . . ' ) (V. DURGA RAO) (D.S. SUNDER SINGH) /JUDICIAL MEMBER /ACCOUNTANT MEMBER # /VISAKHAPATNAM: ' /DATED : 13.10.2017 VG/SPS ITA NO.126/VIZAG/2016 SRI CHUKKAPALLI PITCHAIAH FOUNDATION, VIJAYAWADA 6 )# *# /COPY OF THE ORDER FORWARDED TO:- 1. / THE APPELLANT SRI CHUKKAPALLI PITCHAIAH FOUNDA TION, D.NO.26-13-51, POPULAR BUILDING, GANDHINAGAR, VIJAYAWADA-520 003. 2. / THE RESPONDENT THE CIT(EXEMPTIONS), HYDERABAD 3. + / THE CIT, VISAKHAPATNAM 4. + ( ) / THE CIT (A), VISAKHAPATNAM 5. # . , . , # / DR, ITAT, VISAKHAPATNAM 6 . / GUARD FILE / BY ORDER // TRUE COPY // SR. PRIVATE SECRETARY ITAT, VISAKHAPATNAM