Jethro Medical Trust, Coimbatore V. CIT, Coimbatore

ITA 136/CHNY/2013

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 2548 (ITAT-CHENNAI)
• Duration Of Justice: 3 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-05-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: misc
• Appeal Filed On: 28-01-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: G K DHALL
• Assessee Lawyers: T BANUSEKAR
• Keywords: Charitable institution
• Section: 12AA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, CHENNAI BEFORE SHRI ABRAHAM P. GEORGE, ACCOUNTANT MEMBER AND SHRI S.S. GODARA, JUDICIAL MEMBER I.T.A. NO. 136/MDS/2013 M/S JETHRO MEDICAL TRUST, A-415, VIJAYA HYDE PARK APARTMENTS, DURAISAMY LAYOUT, AVARAM PALAYAM ROAD, PEELAMEDU, COIMBATORE 641 004. PAN : AABTJ 5709 Q (APPELLANT) V. THE COMMISSIONER OF INCOME TAX-I, 67-A, RACE COURSE, COIMBATORE 641 018. (RESPONDENT) APPELLANT BY : SHRI T. BANUSEKAR, CA RESPONDENT BY : SHRI G.K. DHALL, CIT DATE OF HEARING : 30.04.2013 DATE OF PRONOUNCEMENT : 09.05.2013 O R D E R PER ABRAHAM P. GEORGE, ACCOUNTANT MEMBER : IN THIS APPEAL FILED BY THE ASSESSEE, ITS GRIEVAN CE IS THAT REGISTRATION SOUGHT UNDER SECTION 12AA OF INCOME-TA X ACT, 1961 (IN SHORT 'THE ACT') WAS DENIED. I.T.A. NO. 136/MDS/13 2 2. FACTS APROPOS ARE THAT ASSESSEE, A TRUST FORMED BY A DEED DATED 6.1.2012, HAD APPLIED FOR REGISTRATION UNDER SECTION 12AA ON 9.5.2012. CIT DENIED THE REGISTRATION CITING THE F OLLOWING REASONS:- (1) THE CORPUS OF THE TRUST WAS ` 10,000/- ONLY. (2) TEN OBJECTS WERE SPECIFIED IN THE DEED, BUT NONE W AS MENTIONED AS MAIN. (3) SERIOUSNESS OF THE INTENTION OF THE TRUSTEES WAS N OT KNOWN. (4) SHRI DANIEL VICTOR, MANAGING TRUSTEE, HAD FORMED T WO OTHER TRUSTS OF WHICH, ONE WAS GRANTED REGISTRATION UND ER SECTION 12AA, WHEREAS, THE OTHER WAS DENIED. (5) FINANCIAL VIABILITY AND THE MEAGERNESS OF THE DONA TIONS RECEIVED BY THE ASSESSEE SHOWED THAT IT HAD NO AMOUNT TO SU BSIST. (6) ATTEMPT OF SHRI DANIEL VICTOR WAS ONLY TO CREATE M ULTIPLE TRUSTS FOR DIVERTING TAXABLE INCOME TO DIFFERENT T AX- EXEMPT ENTITIES. 3. NOW BEFORE US, LEARNED A.R., STRONGLY ASSAILING THE ORDER OF CIT, SUBMITTED THAT NONE OF THE REASONS MENTIONED B Y CIT HAD ANY RELEVANCE. ACCORDING TO HIM, ONCE THE TRUST WAS FO UND TO BE GENUINE AND HAD DONE SOME CHARITABLE ACTIVITY, REGISTRATION COULD NOT BE DENIED. RELYING ON THE TRUST DEED, LEARNED A.R. SU BMITTED THAT OBJECTS MENTIONED THEREIN ALL WERE CLEARLY CHARITAB LE IN NATURE. ASSESSEE HAD FILED INCOME & EXPENDITURE ACCOUNT FOR THE PERIOD 1 ST APRIL, 2012 TO 15 TH NOVEMBER, 2012, WHICH SHOWED AN INCOME OF ` 25,516/- AND EXPENDITURE IN THE NATURE OF REHABILIT ATION OF HANDICAPPED OF ` 30,763/-. I.T.A. NO. 136/MDS/13 3 4. PER CONTRA, LEARNED D.R. SUPPORTED THE ORDER OF CIT. 5. WE HAVE PERUSED THE ORDERS AND HEARD THE RIVAL SUBMISSIONS. OBJECTS MENTIONED IN THE TRUST DEED ARE REPRODUCED HEREUNDER:- 1. TO PROMOTE, ESTABLISH, SUPPORT, MAINTAIN AND GRANT AID IN CASH OR IN KIND TO HOSPITALS, MEDICAL SCHOOLS, MEDICAL COLLEGE S, NURSING INSTITUTIONS, DISPENSARIES, MATERNITY HOMES, CHILD WELFARE CENTRES AND / OR SUCH OTHER SIMILAR CHARITABLE INSTITUTIONS IN INDIA FOR THE BENEFIT AND USE OF THE GENERAL PUBLIC. 2. FOR THE TREATMENT OR PREVENTING OF ALL ILLNESS, DIS EASE OR DISABILITY, ESTABLISHING, RUNNING, MAINTAINING OR ASSISTING CLI NICS, HOSPITALS AND OTHER MEDICAL INSTITUTIONS, MEDICAL COLLEGE OR OTHE R PARAMEDICAL TRAINING FOR VARIOUS CATEGORIES OF ASSISTANCE REQUI RED FOR MEDICAL TREATMENT. 3. TO ORGANIZE CONFERENCES, SEMINARS, WORKSHOPS OR OTH ER MEETS OF PROFESSIONALS ENGAGED IN RESEARCH AND TREATMENT OF ANY KIND OF ILLNESS, DISEASE, DISABILITY, TO UPDATE AND EXCHANG E INFORMATION RELATING TO ANY KIND OF ILLNESS, DISEASE, DISABILIT Y, RESEARCH AND PREVENTION AND TREATMENT OF ANY KIND OF ILLNESS, DI SEASE, DISABILITY AND TO MAKE AVAILABLE THE KNOWLEDGE, SKILL AND EXPE RTISE OF EMINENT PERSONALITIES IN THE FIELD FROM DIFFERENT P ARTS OF THE WORLD. 4. TO FACILITATE EDUCATION AMONG MEDICAL MEN AND STUDE NTS BY ARRANGING COURSES FOR DEGREES, DIPLOMAS AND CERTIFI CATE IN MEDICAL SCIENCE AND SERVICE AND TO PROVIDE IN HOUSE TRAININ G OR ARRANGE IN HOUSING TRAINING IN INSTITUTIONS. 5. TO PUBLISH RESEARCH PAPERS, ARTICLES RELATING TO AN Y KIND OF ILLNESS MAKE AVAILABLE BOOKS, PERIODICALS, AUDIO AND VIDEO TAPES RELATING TO ANY KIND OF ILLNESS, DISEASE OR DISABILITY AND TO D O EVERYTHING POSSIBLE FOR COMMUNICATION OF KNOWLEDGE, SKILLS AND EXPERTISE RELATING TO ANY KIND OF ILLNESS, DISEASE, DISABILIT Y TO PERSONS ENGAGED IN STUDY, RESEARCH AND TREATMENT. 6. TO GIVE GRANTS, SUBSIDIES OR OTHER ASSISTANCE BY ME DICAL CAMPS FOR MEDICAL TREATMENTS AND ARRANGE SUCH FINANCING OF SU CH I.T.A. NO. 136/MDS/13 4 PROGRAMMES OR SUCH OTHER HELP AS WOULD BE NECESSARY IN THE CIRCUMSTANCES OF EACH CASE. 7. TO CO-OPERATE WITH OTHER INSTITUTIONS ENGAGED IN TR EATMENT AND RESEARCH OF ANY KIND OF ILLNESS, DISEASE OR DISABIL ITY BY HAVING JOINT PROGRAMMES FOR CONDUCTING CONFERENCES AND SEMINARS OR BY HAVING ANY OTHER JOINT PROJECTS RELATING TO MEDICINE. 8. TO ARRANGE FOR SUPPLY OF MEDICAL EQUIPMENTS FOR MED ICAL INSTITUTIONS AND SUPPLY MEDICAL AND SURGICAL TREATM ENT OF PATIENTS AND GIVING THEM INSTITUTIONAL CARE AND GIVE FREE ME DICINE. 9. TO GRANT AID IN CASH OR KIND OR RENDER ASSISTANCE F OR SUCH PURPOSES TO OTHER PUBLIC CHARITABLE TRUSTS OR INSTITUTIONS. 10. TO UNDERTAKE ANY OTHER INSTITUTIONAL ACTIVITIES CON SISTENT WITH THE ABOVE OBJECTS. 6. THERE IS NOTHING IN LAW WHICH REQUIRES ANY PARTI CULAR OBJECT TO BE SHOWN AS MAIN OBJECT. ALL TEN OBJECTS, IN OUR O PINION, CAN BE CONSIDERED AS MAIN OBJECTS. EACH OF THE OBJECT WAS CHARITABLE IN NATURE. ASSESSEE HAD JUST STARTED ITS ACTIVITIES. IT WAS FORMED BY A TRUST DEED EXECUTED ON 4 TH NOVEMBER, 2011 AND HAD MOVED AN APPLICATION UNDER SECTION 12AA OF THE ACT, ON 9.5.2 012. ASSESSEE HAD PRODUCED BEFORE THE CIT, INCOME & EXPENDITURE S TATEMENT FOR THE PERIOD FROM 1 ST APRIL, 2012 TO 15 TH NOVEMBER, 2012, WHICH CLEARLY SHOWED HANDICAPPED REHABILITATION EXPENDITURE OF ` 30,763/-. WE ARE OF THE OPINION THAT ASSESSEE HAD SUBSTANTIATED ITS EXISTENCE AS WELL AS GENUINENESS OF ITS ACTIVITIES. HONBLE KARNATAK A HIGH COURT IN THE CASE OF DIT(E) V. MEENAKSHI AMMA ENDOWMENT TRUST (2 011) 50 DTR (KAR) 243 HAD HELD THAT ACTIVITY OF THE TRUST WAS R EQUIRED TO BE I.T.A. NO. 136/MDS/13 5 CONSIDERED ONLY WHEN REGISTRATION WAS SOUGHT LONG A FTER THE FORMATION OF THE TRUST. WE ARE, THEREFORE, OF THE OPINION TH AT ASSESSEE DESERVED THE REGISTRATION SOUGHT UNDER SECTION 12AA OF THE A CT. ORDER OF CIT IS QUASHED. HE IS DIRECTED TO GRANT THE ASSESSEE R EGISTRATION SOUGHT BY IT UNDER SECTION 12AA OF THE ACT. ORDER WAS PRONOUNCED IN THE COURT ON THURSDAY, THE 9 TH OF MAY, 2013, AT CHENNAI. SD/- SD/- (S.S. GODARA) (ABRAHAM P. GEORGE) JUDICIAL MEMBER ACCOUNTANT MEMBER CHENNAI, DATED THE 9 TH MAY, 2013. KRI. COPY TO: (1) APPELLANT (2) RESPONDENT (3) CIT-I, COIMBATORE (4) D.R. (5) GUARD FILE