M/s Temple ShriGoverdhanNathJi Trust, Karnal V. CIT(E), Chandigarh

ITA 1463/CHANDI/2018

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 7082 (ITAT-CHANDIGARH)
• Duration Of Justice: 1 year(s) 8 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-08-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2018-2019
• Appeal Filed On: 27-11-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: J K GARG
• Assessee Lawyers: M D GUJRATI
• Keywords: Charitable institution
• Section: 12A; 12AA; 11

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH, B CHANDIGARH . . , , BEFORE SHRI N.K. SAINI, VICE PRESIDENT & SHRI SANJAY GARG, JUDICIAL MEMBER ./ ITA NO. 1463/CHD/2018 U/S 12AA (1)(B)(II) TEMPLE SHRI GOVERDHAN NATH JI TRUST, D-562, SHEESH MAHAL, KARNAL HARYANA 132001 THE CIT (EXEMPTIONS), C R BUILDING, CHANDIGARH ! ' ./PAN NO: AASTS3316F !#/ APPELLANT %&!# /RESPONDENT '() * + /ASSESSEE BY : SHRI M.D. GUJRATI, CA * + / REVENUE BY : SHRI J.K. GARG, CIT , - * ).' /DATE OF HEARING : 25.02.2020 /012 * ).' / DATE OF PRONOUNCEMENT : 06. 08.2020 / ORDER PER SANJAY GARG, JUDICIAL MEMBER: THE PRESENT APPEAL HAS BEEN PREFERRED BY THE APPELL ANT-TRUST AGAINST THE ORDER DATED 28.09.2018 OF THE COMMISSIO NER OF INCOME TAX (EXEMPTIONS), CHANDIGARH [HEREINAFTER REFERRED TO AS CIT(E)] IN DENYING THE REGISTRATION TO THE APPELLANT-TRUST U/S 12A READ WITH SECTION 12AA OF THE INCOME TAX ACT AS CHARITABLE AND RELIG IOUS INSTITUTION. 2. AS PER THE BYE-LAWS OF THE APPELLANT-TRUST, THE STATED AIMS AND OBJECTS OF THE TRUST ARE TO DO SEWA, WISH, BHOG, FE STIVAL, DEVOTION, KIRTAN ETC. AS PER PUSHTIMARGIYA COMMUNITY & PRINCIPLES ES TABLISHED BY SHRI ITA NO. 1463-C-2018 TEMPLE SHRI GOVERDHAN NATH JI TRUST, KARNAL 2 VALLABHACHARYA JI; AND ACCORDING TO DIVINE CHARACTE R OF SHRI GOVERDHANNATH JI TO RUN GAUSHALA; FURTHER TO RUN SA NSKRIT SCHOOL; TO ESTABLISH AYURVED AND ALOPATHY DISPENSARIES ETC. TH E APPELLANT-TRUST APPLIED FOR REGISTRATION U/S 12AA OF THE INCOME TAX ACT, 1961 (IN SHORT 'THE ACT') TO THE LD. CIT(E), HOWEVER, THE LD. CIT (E) REJECTED THE APPLICATION OF THE TRUST OBSERVING AS UNDER:- 9. FURTHER THE APPLICANT HAS STATED IN 'NOTE ON A CTIVITIES' THAT THE TRUST HAS PERFORMED ACTIVITIES SUCH AS MAHARAJ JI J ANAM UTSAV, SRI KRISHRN JANMASTAMI UTSAV, HOLI MILAN SAMAROH, BHAND ARA ETC. SINCE 2015. THESE ACTIVITIES DON'T MEASURE UP TO THE PARA METERS OF ANY OF THE LIMBS U/S 2(15) OF THE ACT. MOREOVR, IT IS ALSO SE EN FROM THE INCOME & EXPENDITURE ACCOUNT THAT THE APPLICANT TRUST HAS IN CURRED MAJOR EXPENDITURES ON SALARY, UTSAV & CELEBRATION, SEWA & PUJA SAMAGRI, BHANDARA EXPENSES IN LAST THREE YEARS WHICH ARE TAB ULATED AS BELOW- F.Y 2015-16 2016-17 2017-18 SALARY 1,20,000/- 1,50,000/- - SEWA & PUJA SAMAGRI 1,65,809/- 1,51,737/- 63,874/- UTSAV & CELEBRATION 85,496/- 136,425/- 66,000/- BHANDARA 53,781/- 90,077/- 44,750/- REPAIR & MAINTENANCE EXP. 72,388/ - 79,070/ - 18,327/ - EXPENDITURES ON SEWA & PUJA SAMAGRI CLEARLY INDICAT E THAT THE APPLICANT TRUST IS PREDOMINANTLY INVOLVED IN WORSHIP OF IDOL OF SHRI GOVARDHAN NATH JI FOR WHICH THE TEMPLE WAS CONSTRUCTED. IT IS ALSO CLEAR FROM THE ABOVE THAT THE TRUST USED RECEIPTS PREDOMINANTLY FOR PURSUING ACTIVITIES THAT DON'T PARTAKE THE CHARACTER OF CHARITABLE PURPOSES. IN FA CT, IN THIS CASE THE APPLICANT TRUST HAS COLLECTED MONEY FROM GENERAL PU BLIC AS DONATIONS AND THAT MONEY HAS BEEN UTILIZED FOR ACTIVITIES THAT AR E RESTRICTED TO THE SHRINE AND THE IDOLS THEREIN. NO CHARITABLE WORK IS BEING DONE BY SOCIETY FROM PUBLIC MONEY. THE ABSENCE OF BENEFICIARY CLAUSE, IN VESTMENT CLAUSE OR THE ITA NO. 1463-C-2018 TEMPLE SHRI GOVERDHAN NATH JI TRUST, KARNAL 3 IRREVOCABILITY CLAUSE FURTHER IMPINGE ON THE PUBLIC CHARITABLE NATURE OF THE TRUST. 10. IT IS FURTHER SEEN THAT THE APPLICANT TRUST HA S FILED ITS RETURNS OF INCOME IN THE FORM NO. ITR-5 FOR THE A.Y 2016-17 AND 2017- 18 WHICH IS REQUIRED TO BE FILED BY FIRM, AOP AND BOI. IT IS PERTINENT T O MENTION THAT AS PER RULE 12(1) OF THE IT RULES, 1962, THE RETURNS OF INCOME OF THE SOCIETY/TRUST/COMPANY WHICH WORKS ON THE PRINCIPAL OF 'NO PROFIT NO LOSS', ARE REQUIRED TO BE FILED IN FORM NO. ITR-7. FILING OF RETURN OF INCOME IN FORM NO. ITR-5 CLEARLY INDICATES THAT THE APPLICANT TRUST IN ITS OWN PERCEPTION AS WELL DEEMS ITSELF TO BE OUT OF THE AM BIT OF CHARITABLE ACTIVITIES. 11. IN VIEW OF THE ABOVE, IT IS HELD THAT THE SOCIE TY'S ACTIVITIES ARE LIMITED TO A MANDIR AND WORSHIP OF IDOL OF SHRI GOVRADHAN NATH JI. THE PUBLIC MONEY RECEIVED AS DONATIONS HAS BEEN SPENT ON IDOLS AND R EPAIR & MAINTENANCE OF THE MANDIR WHICH DOES NOT PARTAKE THE CHARACTERS OF ANY OF THE LIMBS ENVISAGED IN SECTION 2(15) OF THE I.T ACT. MOREOVER , FRARNING BYE-LAWS AND CHANGING ITS COMPOSITION BY PASSING A MERE RESOLUTI ON WITHOUT ANY ACCEPTANCE OF COMPETENT COURT, ARE NOT TENABLE. LAC K OF BENEFICIARY CLAUSE AND THE INVESTMENT CLAUSE RELEVANT TO FORMATION OF PUBLIC CHARITABLE TRUST DOES NOT ENTHUSE CONFIDENCE THAT THE TRUST ENURES T O THE BENEFIT OF GENERAL PUBLIC. THE APPLICATION FOR GRANT OF REGISTRATION U /S 12AA IS ACCORDINGLY REJECTED. 3. BEING AGGRIEVED BY THE ABOVE ORDER OF THE LD. CIT(E), THE APPELLANT-TRUST HAS COME IN APPEAL BEFORE US. 4. WE HAVE HEARD THE RIVAL CONTENTIONS OF THE LD. A UTHORIZED REPRESENTATIVES OF BOTH THE PARTIES AND HAVE ALSO G ONE THROUGH THE RECORD. ADMITTEDLY, THE APPELLANT-TRUST IS A REGIST ERED TRUST. AS PER THE REGISTRATION DEED, COPY OF WHICH HAS BEEN PLACED AT PAGE 38 OF THE PAPER BOOK, THE PROPERTY OF THE TRUST WAS DONATED BY ONE GOSWAMI SHRI PARSHOTAM LAL JI S/O GOSWAMI SHRI DAMODAR LAL JI FO R ESTABLISHMENT OF SHRI GOVERDHANNATH JI TEMPLE AND FOR DOING OTHER RE LIGIOUS AND CHARITABLE ACTIVITIES. THE TRUST HAS ITS BYE-LAWS, AS PER WHICH THE ITA NO. 1463-C-2018 TEMPLE SHRI GOVERDHAN NATH JI TRUST, KARNAL 4 OBJECTS OF THE TRUST ARE FOR WORSHIP OF IDOL OF SHR I GOVERDHANNATH JI AND MAINTENANCE OF THE TEMPLE AND TO FOLLOW THE PRINCIP LES SET BY SHRI VALLABHACHARYA JI OF SERVICE, MANORATH, GOOD OBJECT S, BHOG, FESTIVAL, BHAKTI, KIRTAN ETC. AND FURTHER ACCORDING TO DIVINE CHARACTER AND PRINCIPLE OF SHRI GOVERDHANNATH JI, TO RUN GAUSHALA AND SANSKRIT SCHOOL; TO ESTABLISH AYURVEDA AND ALOPATHY DISPENSARY ETC. AND FURTHER TO HELP MANKIND IN CASE OF ANY NATURAL OR MAN CREATED CALAM ITIES AND TO PERFORM OTHER RELIGIOUS ACTIVITIES AS DETAILED IN THE BYE-L AWS. ONE OF THE OBJECTS IS TO IMPART EDUCATION TO THE STUDENTS WITHOUT ANY DISCRIMINATION OF CASTE OR RELIGION; TO GIVE SCHOLARSHIP AND HELP TO NEEDY STUDENTS FOR HIGHER EDUCATION ETC. APART FROM THAT, OBJECTS OF ORGANIZING MEDICAL CAMPS, BLOOD DONATIONS ARE ALSO PART OF THE OBJECTS AS PER BYE LAWS OF THE TRUST. THE TRUST ALSO HOLDS THE ACTIVITY OF BH ANDARA (FREE FOOD) TO ALL. AS PER THE PROVISIONS OF SECTION 11 READ WITH SECTI ON 12A OF THE INCOME TAX ACT, 1961, THE REGISTRATION CAN BE GRANTED TO T HE CHARITABLE OR RELIGIOUS TRUST OR INSTITUTION. A PERUSAL OF THE O RDER OF THE LD. CIT(E) SHOWS THAT THE LD. CIT(E) HAS DECLINED REGISTRATION MAINLY ON THE GROUND THAT THE APPELLANT TRUST IS PRE-DOMINANTLY D OING THE RELIGIOUS ACTIVITIES AND THAT THE SAME DO NOT PARTAKE THE CHA RACTER OF CHARITABLE ACTIVITY. HOWEVER, AS PER THE RELEVANT PROVISIONS OF SECTION 11 READ WITH SECTIONS 12A & 12AA OF THE ACT, THE REGISTRATI ON CAN BE GRANTED TO CHARITABLE OR RELIGIOUS INSTITUTION. UNDER THE CIRC UMSTANCES, THERE IS NO BAR IN GRANTING REGISTRATION TO A RELIGIOUS INSTITU TION UNDER THE RELEVANT ITA NO. 1463-C-2018 TEMPLE SHRI GOVERDHAN NATH JI TRUST, KARNAL 5 PROVISIONS. MOREOVER, AS PER THE OBJECTS OF THE TRU ST, THE TRUST IS ALSO INVOLVED IN CHARITABLE ACTIVITIES AS NOTED ABOVE. T HE LD. CIT(E) HIMSELF HAS NOTED THAT THE TRUST HAD SPENT CONSIDERABLE MON EY ON BHANDARA (FREE FOOD ) TO ALL, WHICH, IN FACT, IS A RELIGIOU S-CUM- CHARITABLE ACTIVITY. WE, THEREFORE, DO NOT FIND ANY JUSTIFICAT ION ON THE PART OF THE LD.CIT(E) TO DECLINE THE REGISTRATION TO THE APPELL ANT-TRUST. IN VIEW OF THE ABOVE DISCUSSION, THE APPEAL OF THE APPELLANT TRUST IS ALLOWED AND THE LD. CIT (E) IS DIRECTED TO REGISTER THE APPELLANT-TRUST U/S 12A / 12AA OF THE INCOME TAX ACT. IN THE RESULT, THE APPEAL OF THE APPELLANT TRUST ST ANDS ALLOWED. ORDER COULD NOT BE PRONOUNCED EARLIER DUE TO NON-FU NCTIONING OF THE BENCH ON ACCOUNT OF CURFEW / LOCKDOWN IN THE WA KE OF COVID-19 PANDEMIC. ORDER PRONOUNCED ON 06.08.2020. SD/- SD/- ( . . / N.K. SAINI) ( ! ' / SANJAY GARG) #$% / VICE PRESIDENT &' / JUDICIAL MEMBER DATED : 06.08 .2020 .. 3*%)45 651) / COPY OF THE ORDER FORWARDED TO : 1. !# / THE APPELLANT 2. %&!# / THE RESPONDENT 3. , 7) / CIT 4. , 7) ( )/ THE CIT(A) 5. 58%)9' , .9'2 , :;<= / DR, ITAT, CHANDIGARH 6. <>- / GUARD FILE 3 , / BY ORDER, ITA NO. 1463-C-2018 TEMPLE SHRI GOVERDHAN NATH JI TRUST, KARNAL 6 ? / ASSISTANT REGISTRAR