A-1 BAYANA FOUNDATION TRUST, Sawai Madhopur V. CIT, Jaipur

ITA 141/JPR/2015

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 5400 (ITAT-JAIPUR)
• Duration Of Justice: 1 year(s) 1 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-03-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: misc
• Appeal Filed On: 10-02-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: D S KOTHARI CIT DHK
• Assessee Lawyers: B V MAHESHWARI
• Section: 12AA; 11

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE S, JAIPUR JH EQDQY DS-JKOR] U;KF;D LNL; ,OA JH FOE FLAG ;KNO] YS[KK LNL; DS LE{K BEFORE: SHRI MUKUL K. SHRAWAT, JM & SHRI VIKR AM SINGH YADAV, AM VK;DJ VIHY LA-@ ITA NO. 141/JP/2015 AL BAYAN FOUNDATION TRUST, NOOR MANZIL, V&P BEHTED, TEHSIL- MALARNA DOONGER, SAWAI MADHOPUR. CUKE VS. COMMISSIONER OF INCOME TAX, (EXEMPTION), HUDCO BUILDING, JYOTI NAGAR, JAIPUR. LFKK;H YS[KK LA - @THVKBZVKJ LA - @ PAN/GIR NO. AADTA 5638 D VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI B.V. MAHESHWARI (C.A) JKTLO DH VKSJ LS@ REVENUE BY : SHRI D.S. KOTHARI (CIT) LQUOKBZ DH RKJH[K @ DATE OF HEARING : 08.03.2016. ?KKS'K .KK DH RKJH[K @ DATE OF PRONOUNCEMENT : 11/03/2016. VKNS'K@ ORDER PER MUKUL K. SHRAWAT, JM : THIS IS AN APPEAL FILED BY THE ASSESSEE EMANATING FROM AN ORDER OF LD. COMMISSIONER OF INCOME TAX (EXEMPTION), JAIPUR DATED 18.12.2014 PASSED UNDER SECTION 12AA(1)(B) OF I.T. ACT. THE APPELLANT HAS RAISED THE FOLLOWING GROUND :- THAT THE LD. CIT (EXEMPTION) HAVE GROSSLY ERRED I N NOT ALLOWING THE REGISTRATION U/S 12A(A) OF INCOME TAX ACT, 1961. TH E LD. CIT PASSED ORDER U/S 12AA(1)(B) OF I.T. ACT 1961 & REJECTED THE APPL ICATION FILED BY TRUST. 2. ON THIS SHORT ISSUE OF REJECTION OF REGISTRATION OF THE TRUST UNDER SECTION 12AA, WE HAVE HEARD BOTH THE SIDES. AT THE OUTSET, WE HA VE NOTED THAT MAINLY TWO REASONS 2 ITA NO. 141/JP/2015 AL BAYAN FOUNDATION TRUST VS. CIT WERE MENTIONED BY LD. COMMISSIONER OF INCOME TAX WH ILE REJECTING THE REGISTRATION AS UNDER :- 5. THE PROVISIONS OF SECTION 12AA STIPULATE THE FO LLOWING CONDITIONS FOR REGISTRATION U/S 12AA OF THE I.T. ACT, 1961 : (I) THE OBJECT OF THE SOCIETY SHOULD BE OF CHARITABLE I N NATURE. (II) THE ACTIVITIES OF THE SOCIETY SHOULD BE GENUINE. FROM THE DISCUSSION MADE ABOVE, IT IS CLEAR THAT : (I) THE OBJECT OF THE TRUST ARE NOT CHARITABLE IN NATUR E AS THEY ARE FOR THE BENEFIT OF THE PARTICULAR RELIGIOUS COMMUNITY. THEREFORE, THE PROVISIONS OF SECTION 13(1)(B) ARE ATTRACTED. (II) THE APPLICANT HAS CARRIED OUT ITS ACTIVITIES IN THE MANNER THAT THE PROVISIONS OF SECTION 13(1)(C) READ WITH SECTION 13 (2) ARE ATTRACTED. THUS THE ACTIVITIES OF THE TRUST CANNOT BE HELD AS GENUINE. BASED ON THE MATERIAL AVAILABLE ON RECORD, I AM SAT ISFIED THAT THE ACTIVITIES OF THE TRUST ARE NOT GENUINE AND REGISTRATION TO TH E TRUST IS REFUSED. 2.1. IN OUR CONSIDERED OPINION, THE PROCEDURE FOR R EGISTRATION AS PRESCRIBED UNDER SECTION 12AA ARE THAT ON AN APPLICATION FOR REGISTR ATION OF A TRUST, THE LD. COMMISSIONER SHALL CALL FOR SUCH DOCUMENTS OR INFORMATION FROM T HE TRUST ABOUT THE GENUINENESS OF THE ACTIVITIES OF THE TRUST. IN THIS REGARD, THE L D. COMMISSIONER MAY MAKE SUCH ENQUIRY AS HE MAY DEEM NECESSARY. AFTER SATISFYING HIMSELF ABOUT THE OBJECT OF THE TRUST AND THE GENUINENESS OF ITS ACTIVITIES, HE SHALL PASS AN ORDER IN WRITING REGISTERING THE TRUST. FROM THE IMPUGNED ORDER OF LD. COMMISSIONER, WE HAV E NOTED THAT HE HAS NOT GIVEN ANY SPECIFIC REASON THAT WHY HE WAS NOT SATISFIED W ITH THE ACTIVITIES OF THE TRUST AND WHY THE OBJECTS OF THE TRUST WERE HELD AS NOT GENUINE. MERELY BECAUSE A SOCIETY IS ESTABLISHED FOR THE BENEFIT OF A RELIGIOUS COMMUNIT Y, THE LD. COMMISSIONER HAD THOUGHT 3 ITA NO. 141/JP/2015 AL BAYAN FOUNDATION TRUST VS. CIT IT PROPER TO REFUSE THE REGISTRATION. HOWEVER, ACCO RDING TO OUR HUMBLE UNDERSTANDING OF LAW, THE PROVISIONS OF SECTION 13(1)(B) READ WITH EX PLANATION-2, AS MENTIONED BY THE LD. COMMISSIONER SHOULD BE CONSIDERED DURING THE COURSE OF ASSESSMENT OF A TRUST. AT THE TIME OF ASSESSMENT, THE QUESTION OF EXEMPTION OF A PARTICULAR INCOME AS WELL AS THE APPLICABILITY OF THE PROVISIONS OF SECTION 11 ARE R EQUIRED TO BE EXAMINED. HOWEVER, THE PROCEDURE OF REGISTRATION IS THE FIRST STEP WHICH I S AN INDEPENDENT PROCEEDING HAVING NO EFFECT ON THE ASSESSMENT OF A TRUST. THERE ARE UMP TEEN NUMBER OF CASES DECIDED BY THE TRIBUNAL AS WELL AS BY SEVERAL HONBLE COURTS E XPRESSING THE SAME VIEW THAT THE PROVISIONS OF SECTION 12AA ARE TO BE ONLY FOLLOWED WHILE DISPOSING AN APPLICATION FOR REGISTRATION OF A TRUST. WITHOUT ELABORATING THOSE DECISIONS IN DETAIL, WE ARE OF THE CONSCIENTIOUS VIEW THAT THE ISSUE OF REGISTRATION O F THIS TRUST IS REQUIRED TO BE DECIDED AFRESH BY THE LD. COMMISSIONER, NEEDLESS TO SAY AFT ER EXAMINING THE OBJECTS AS WELL AS THE ACTIVITY OF THE TRUST AFTER PROVIDING AN ADEQUA TE OPPORTUNITY TO THE ASSESSEE. SINCE WE ARE RESTORING THIS ISSUE BACK TO THE FILE OF THE LD. COMMISSIONER, THEREFORE, THE GROUND RAISED BY THE ASSESSEE MAY BE TREATED AS ALL OWED BUT FOR STATISTICAL PURPOSES ONLY. 3. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 11/03/201 6. SD/- SD/- FOE FLAG ;KNO] EQDQY DS-JKOR (VIKRAM SINGH YADAV ) (MUKUL K. SHRAWAT) YS[KK LNL;@ ACCOUNTANT MEMBER U;KF;D LNL;@ JUDICIAL MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 11/03/2016. DAS/ 4 ITA NO. 141/JP/2015 AL BAYAN FOUNDATION TRUST VS. CIT VKNS'K DH IZFRFYFI VXZSF'KR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- AL BAYAN FOUNDATION TRUST, SAWAI MAD HOPUR. 2. IZR;FKHZ@ THE RESPONDENT-THE CIT (EXEMPTION), JYOTI NAGAR, JA IPUR. 3. VK;DJ VK;QDRVIHY@ CIT(A). 4. VK;DJ VK;QDR@ CIT, 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR 6. XKMZ QKBZY@ GUARD FILE (ITA NO.141/JP/2015) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASSISTANT. REGISTRAR