M/s Dasari Bulli Venkata Raju & Smt. Dasari Venkata Ramanamma Charitable Trust, Visakhapatnam V. THE CIT - 1, Visakhapatnam

ITA 147/VIZ/2013

• Counselvise Citation: [2015] 134 COUNSELVISE.COM (IT) 0201 (ITAT-VISAKHAPATNAM)
• Duration Of Justice: 2 year(s) 8 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-11-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: misc
• Appeal Filed On: 07-03-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: G GURUSWAMY
• Keywords: Charitable institution
• Section: 12A; 12AA

Judgement Text

ITA NO.147/VIZAG/2013 M/S. DASARI BULLI VENKATA RAJU & SMT. DASARI VENKATA RAMANAMMA CHARITABLE TRUST, VSK P 1 , , IN THE INCOME TAX APPELLATE TRIBUNAL, VISAKHAPATNAM BENCH, VISAKHAPATNAM . . . . , ,, , . . . . , , , , % % % % BEFORE SHRI V. DURGA RAO, JUDICIAL MEMBER & SHRI G. MANJUNATHA, ACCOUNTANT MEMBER . .. ./ // / I.T.A.NO.147/VIZAG/2013 ( / ASSESSMENT YEAR : NA) M/S. DASARI BULLI VENKATA RAJU & SMT. DASARI VENKATA RAMANAMMA CHARITABLE TRUST VISAKHAPATNAM VS. CIT - 1 VISAKHAPATNAM [ PAN: AADTS8344L ] (+ + + + / APPELLANT) (,-+ ,-+ ,-+ ,-+ / RESPONDENT ) + / / APPELLANT BY : SHRI G.V.N. HARI, AR ,-+ / / RESPONDENT BY : SHRI G. GURUSWAMY, DR / 3 / DATE OF HEARING : 0 6.11.2015 / 3 / DATE OF PRONOUNCEMENT : 27.11.2015 / O R D E R PER V. DURGA RAO, JUDICIAL MEMBER: THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE OR DER OF THE CIT-1, VISAKHAPATNAM. ITA NO.147/VIZAG/2013 M/S. DASARI BULLI VENKATA RAJU & SMT. DASARI VENKATA RAMANAMMA CHARITABLE TRUST, VSK P 2 2. FACTS ARE IN BRIEF THAT THE ASSESSEE TRUST I.E. M/S. DASARI BULLI VENKATA RAJU & SMT. DASARI VENKATA RAMANAMMA CHARIT ABLE TRUST BEING A REGISTERED TRUST FILED AN APPLICATION IN FO RM NO.10A, SEEKING GRANT OF REGISTRATION U/S 12AA OF THE INCOME-TAX AC T, 1961 (HEREINAFTER CALLED AS THE ACT) IN THE STATUS OF CHARITABLE TR UST. THE ASSESSEE TRUST WAS CREATED WITH THE FOLLOWING OBJECTIVES: 1. TO ESTABLISH AND/OR MAINTAIN EDUCATIONAL INSTITUTIO NS INCLUDING CRCHES, BALWADIS, SCHOOLS AND COLLEGES FOR THE BEN EFIT OF VILLAGERS TO IMPART FORMAL AND NON FORMAL EDUCATION. 2. TO RUN PROJECTS FOR IMPARTING SKILLS TO VILLAGERS T O IMPROVE THEIR CAPABILITIES BOTH IN INCOME GENERATING AND AWARENES S BUILDING. 3. TO DEVELOP AND/OR RUN EDUCATIONAL PROGRAMMES TO DEV ELOP LEADERSHIP QUALITIES IN VILLAGERS. 4. TO DEVELOP AND/OR MAINTAIN WORKSHOPS, LABORATORIES, EXPERIMENTAL FARMS, DEMONSTRATIONS UNITS, PILOT PLANTS AND THE L IKE TO EDUCATE AND TRAIN VILLAGERS. 5. TO ESTABLISH AND/OR MAINTAIN RESEARCH INSTITUTIONS TO AID IN IMPROVEMENT OF QUALITY OF VILLAGE LIFE. 6. TO ESTABLISH AND/OR MAINTAIN VILLAGE INDUSTRIES TO TRAIN AND HELP VILLAGERS ESTABLISH THEIR OWN UNITS. 7. TO HELP IN INSTRUCTING THE SCHOOL DROP OUTS, AND TH E ILLITERATE IN RUNNING OUT OF THE SCHOOL INSTRUCTIONAL PROGRAMMES. 8. TO RUN SPECIAL EDUCATIONAL PROGRAMMES FOR THE BENEF IT OF WOMEN AND HANDICAPPED CHILDREN. 9. TO RESEARCH INTO, DEVELOP AND/OR PRODUCE SCHOOL AID S, AGROVISUALS, FILM STRIPS AND OTHER EDUCATIONAL MATERIAL. 10. TO BRING OUT BOOKS, PAMPHLETS, CHARTS, NEWSLETTERS, AND THE LIKE FOR GENERAL INFORMATION AND EDUCATION. 11. TO UNDERTAKE AND/OR PROMOTE OTHER ACTIVITIES ANCILL ARY TO THE MAIN OBJECTIVES AND FUNCTIONS OF THE TRUST. ITA NO.147/VIZAG/2013 M/S. DASARI BULLI VENKATA RAJU & SMT. DASARI VENKATA RAMANAMMA CHARITABLE TRUST, VSK P 3 3. THE LD. COMMISSIONER REJECTED THE REGISTRATION U /S 12AA OF THE ACT ON THE GROUND THAT THOUGH THE ASSESSEE TRUST HAS CA RRIED OUT THE ACTIVITIES RELATING TO ITS OBJECT OF EXTENDING EDUC ATIONAL FACILITY TO THE POOR STUDENTS, YET IT HAVING NOT SPENT 85% OF ITS I NCOME FOR ASSESSMENT YEAR 2010-11 AND 2011-12. 4. ON BEING AGGRIEVED ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL. 5. THE LD. COUNSEL FOR THE ASSESSEE HAS SUBMITTED T HAT THE ASSESSEE TRUST SOLELY EXISTING FOR THE PURPOSE OF CARRYING O NLY CHARITABLE ACTIVITIES AND REGISTRATION U/S 12AA OF THE ACT MAY BE GRANTED TO THE ASSESSEE SOCIETY. 6. ON THE OTHER HAND, THE LD. D.R. HAS RELIED ON TH E ORDER PASSED BY THE LD. CIT(A). 7. WE HAVE HEARD BOTH THE SIDES, PERUSED THE RECORDS AND GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. WE FI ND THAT AS PER THE OBJECTIVES OF THE ASSESSEE TRUST, IT IS EXISTED SOL ELY FOR THE PURPOSE OF CARRYING CHARITABLE ACTIVITIES. IN FACT THE LD. CO MMISSIONER HIMSELF HAS SAID THAT ASSESSEE HAS CARRIED OUT ITS ACTIVITIES R ELATING TO EXTENDING EDUCATIONAL FACILITIES TO THE POOR STUDENTS. THE O NLY OBJECTION RAISED BY THE LD. COMMISSIONER IS THAT 85% OF ITS INCOME NOT SPENT FOR THE ITA NO.147/VIZAG/2013 M/S. DASARI BULLI VENKATA RAJU & SMT. DASARI VENKATA RAMANAMMA CHARITABLE TRUST, VSK P 4 ASSESSMENT YEAR UNDER CONSIDERATION AND SUBSEQUENT ASSESSMENT YEAR. THIS CANNOT BE A GROUND FOR REJECTION OF REGISTRATI ON U/S 12AA OF THE ACT. WHEN THE ASSESSEE FILED AN APPLICATION IN FORM NO.10 A SEEKING REGISTRATION, THE LD. COMMISSIONER HAS TO SEE THE O BJECTIVES OF THE SOCIETY AND GENUINENESS IN RESPECT OF CARRYING OUT THE OBJECTIVES. THE HONBLE KARNATAKA HIGH COURT IN THE CASE OF SANJEEV AMMA HANUMANTHE GOWDA CHARITABLE TRUST VS. DIRECTOR OF INCOME TAX ( EXEMPTION) 285 ITR 327 HAS CONSIDERED THE REGISTRATION U/S 12A OF THE ACT TO THE CHARITABLE TRUST AND SCOPE OF ENQUIRY AND OBSERVED THAT FOR TH E PURPOSE OF REGISTRATION U/S 12A OF THE ACT WHAT THE AUTHORITIE S HAVE TO SATISFY IS THE GENUINENESS OF THE ACTIVITIES OF THE TRUST OR INSTI TUTION AND HOW THE INCOME DERIVED FROM THE TRUST PROPERTY IS APPLIED T O CHARITABLE OR RELIGIOUS PURPOSES AND NOT THE NATURE OF ACTIVITY B Y WHICH THE INCOME IS DERIVED BY THE TRUST. THERE ARE SUFFICIENT SAFEGUA RDS UNDER THE ACT FOR CANCELLATION OF THE REGISTRATION IF THE PROVISIONS ARE MISUSED. IN THE PRESENT CASE ALL THE OBJECTIVES OF THE TRUST ARE CH ARITABLE IN NATURE AND ASSESSEE ALREADY CARRIED OUT SUCH CHARITABLE ACTIVI TIES AND THE GENUINENESS OF THE ACTIVITIES CARRIED OUT BY THE AS SESSEES TRUST IS DOUBTED BY THE COMMISSIONER. HENCE, THE LD. COMMIS SIONER IS NOT JUSTIFIED IN REJECTING THE REGISTRATION U/S 12AA OF THE ACT. THEREFORE, WE ITA NO.147/VIZAG/2013 M/S. DASARI BULLI VENKATA RAJU & SMT. DASARI VENKATA RAMANAMMA CHARITABLE TRUST, VSK P 5 QUASH THE ORDER PASSED BY THE LD. COMMISSIONER AND DIRECT HIM TO GRANT REGISTRATION TO THE ASSESSEE TRUST U/S 12AA OF THE ACT. WE ORDER ACCORDINGLY. 8. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS ALLOWED . THE ABOVE ORDER WAS PRONOUNCED IN THE OPEN COURT ON 27 TH NOV15. SD/- SD/- ( (( ( . . . . ) ( ) ( ) ( ) ( . .. . ) )) ) ( (( ( G. MANJUNATHA) ( (( ( V. DURGA RAO ) )) ) / // / ACCOUNTANT MEMBER / // / JUDICIAL MEMBER /VISAKHAPATNAM: 6 / DATED : 27.11.2015 VG/SPS / , 7 / COPY OF THE ORDER FORWARDED TO :8 1. + / THE APPELLANT M/S. DASARI BULLI VENKATA RAJU & SMT. DASARI VENKAT A RAMANAMMA CHARITABLE TRUST, D.NO.6-125, PITTUSALI S TREET, PRAKASARAO PET-531126, VISAKHAPATNAM DIST. 2. ,-+ / THE RESPONDENT THE CIT-1, VISAKHAPATNAM 3. ,-+ / THE RESPONDENT THE CIT(E), HYDERABAD 4. < () / THE CIT(A), VISAKHAPATNAM 5. ,, , / // / DR, ITAT, VISAKHAPATNAM 6 . . . . / GUARD FILE / BY ORDER // TRUE COPY // AB ( SR.PRIVATE SECRETARY ) , / // / ITAT, VISAKHAPATNAM