Kurella Harihara Swamy and Gayalthri Devi Charitable Trust, Hyderabad V. Director of Income Tax (Exemptions), Hyderabad

ITA 1471/HYD/2013

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 74733 (ITAT-HYDERABAD)
• Duration Of Justice: 4 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-03-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2013-2014
• Appeal Filed On: 07-11-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P SOMASEKHAR REDDY
• Assessee Lawyers: K CHENUBOTLU
• Keywords: Charitable institution
• Section: 12A; 12AA; 12

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH A', HYDERABAD BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SMT. ASHA VIJAYARAGHAVAN, JUDICIAL MEMBER ITA NO. 1471/HYD/2013 ASSESSMENT YEAR 2013-14 M/S. KURELLA HARIHARA SWAMY AND GAYATHRI DEVI CHARITABLE TRUST, HYDERABAD PAN: ASSPK8262G VS. THE DIRECTOR OF INCOME-TAX (EXEMPTIONS) (I/C.) AAYAKAR BHAVAN HYDERABAD [ASSESSEE] [RESPONDENT] ASSESSEE BY: SRI K. CHENUBOTLU RESPONDENT BY: SRI P. SOMA SEKHAR REDDY DATE OF HEARING: 18.03.2014 DATE OF PRONOUNCEMENT: 18.03.2014 ORDER PER CHANDRA POOJARI, AM: THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E ORDER OF THE DIT(E), HYDERABAD DATED 26.09.2013. 2. THE GRIEVANCE OF THE ASSESSEE IN THIS APPEAL IS WIT H REGARD TO NON-GRANTING OF REGISTRATION U/S. 12AA OF INCOME- TAX ACT, 1961. 3. THE ASSESSEE APPLIED FOR REGISTRATION U/S. 12AA OF T HE ACT IN FORM NO. 10A ON 12.3.2013. THE DIT(E) REJEC TED THE APPLICATION FILED BY THE ASSESSEE ON THE REASON THA T THE ASSESSEE'S OBJECTS INCLUDE BOTH CHARITABLE AND RELI GIOUS ITA NO. 1471/HYD/2013 M/S. KURELLA HARIHARA SWAMY AND GAYATHRI DEVI CHARITABLE TRUST ============================ 2 OBJECTS AND THE ASSESSEE HAS BEEN FORMED ON 30.10.2 009 I.E., AFTER 1.4.1962 AND THE ASSESSEE IS NOT QUALIFIED AS A PUBLIC CHARITABLE OR AS A PUBLIC RELIGIOUS TRUST. AGAINST THIS, THE ASSESSEE IS IN APPEAL BEFORE US. 4. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATERIAL ON RECORD. SIMILAR ISSUE WAS CONSIDERED B Y THIS TRIBUNAL IN THE CASE OF REHOBOTH MISSION IN ITA NO. 352/HYD/2010 VIDE ORDER DATED 26.5.2010 WHEREIN IT WA S HELD AS FOLLOWS: '6. WE HAVE GONE THROUGH THE PROVISIONS OF SEC. 13( 1)(B) OF THE ACT. THERE IS NOTHING IN THE LANGUAGE OF THIS PROVI SION TO SUGGEST THAT AN INSTITUTION OF MIXED OBJECTS IS PRE CLUDED FROM GETTING REGISTRATION U/S 12AA OF THE ACT. IT IS ALS O SEEN FROM THE OBJECTS OF THE TRUST IN QUESTION THAT THE ASSESSEE IS CARRYING ON NO NON-CHARITABLE OR NON-RELIGIOUS ACTIVITIES. WE P LACE RELIANCE ON THE JUDGEMENT OF ACIT V. BARKATE SAIFIYAH SOCIET Y 213 ITR 492 (GUJ) AND CIT V. CHANDRA CHARITABLE TRUST 294 A ITR 86 ( GUJ), WHEREIN IT WAS HELD THAT A TRUST CAN EITHER B E FOR RELIGIOUS PURPOSES OR FOR CHARITABLE PURPOSES OR IT CAN BE FO R BOTH. ONLY A TRUST WHICH IS FOR RELIGIOUS PURPOSE IS EXCLUDED AND DEBARRED FROM REGISTRATION U/S 12AA OF THE ACT. A TRUST WHOS E OBJECT IS CHARITABLE AS WELL AS RELIGIOUS IS NOT DEBARRED FRO M REGISTRATION. FURTHER, IN THE CASE OF NEW LIFE IN C HRIST EVANGELISTIC ASSOCIATION V. CIT & OTHERS 246 ITR 53 2 (MAD), WHEREIN IT WAS HELD THAT FOR GRANTING OR REFUSING R EGISTRATION U/S 12A IN RELATION TO SUCH TRUST, THE ONLY CONDITI ON PRECEDENT IS THAT AN APPLICATION FOR REGISTRATION SHOULD BE MADE IN TIME AND THE ACCOUNTS OF THE INSTITUTE SHOULD BE AUDITED. NO ENQUIRY ABOUT OBJECTS OF THE TRUST CAN BE MADE U/S 12A OF T HE ACT. WE HAVE GONE THROUGH ALL THE JUDGEMENTS CITED BY THE L EARNED COUNSEL FOR THE ASSESSEE. THE FACTS OF THE CASE IN THE CASE CONSIDERED BY THE GUJARAT HIGH COURT SQUARELY APPLY TO THE FACTS OF THE CASE ON HAND. THE DEPARTMENT HAS NOT B ROUGHT ANY CONTRARY DECISION TO OUR NOTICE. IN OUR OPINION, IN THE CIRCUMSTANCES UNDER CONSIDERATION, THE DIT(E) SHOUL D NOT HAVE REJECTED THE APPLICATION OF THE ASSESSEE FOR REGIST RATION U/S ITA NO. 1471/HYD/2013 M/S. KURELLA HARIHARA SWAMY AND GAYATHRI DEVI CHARITABLE TRUST ============================ 3 12AA OF THE ACT ON THIS REASON. COMMENTING ON THE HONOURABLE GUJARAT HIGH COURT DECISION, THE DIT(E) HAS OBSERVED THAT THE HONBLE HIGH COURT HAS INTRODUCED A NEW CONCEPT KNOWN AS CHARITABLE RELIGIOUS TRUST. ACCO RDING TO HIM, TRUST HAS TO BE EITHER WHOLLY RELIGIOUS OR WHO LLY CHARITABLE. OTHERWISE, IT IS NOT ENTITLED FOR REGIS TRATION AND THE HONBLE GUJARAT HIGH COURT DID NOT CONSIDER THE WOR D OR WHICH HAS BEEN EMPLOYED U/S 11(1)(A) AND SEC. 12 OF THE ACT AND THE HONBLE HIGH COURT HAS INTERPRETED SEC. 13( 1)(B) OF THE ACT. WE ARE UNABLE TO AGREE WITH THE DIT(E) AS TO HOW AND WHY THE JUDGEMENT OF THE HONBLE GUJARAT HIGH COURT IS NOT APPLICABLE TO THE FACTS OF THE PRESENT CASE. THERE IS NO SUCH BAR SINCE THERE IS NO JURISDICTIONAL HIGH COURTS JUDGE MENT ON THIS ISSUE, TO THE CONTRARY AND THIS OBSERVATION OF THE DIT(E) IS UNWARRANTED. CONSEQUENTLY, WE DIRECT THE DIT(E) TO GRANT REGISTRATION TO THE ASSESSEE SOCIETY SUBJECT TO FUL FILMENT OF OTHER CONDITIONS, IF ANY. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED ' 5. THE FACTS AND CIRCUMSTANCES OF THE PRESENT CASE ARE SIMILAR TO THAT OF THE CASE CONSIDERED BY THE TRIBU NAL IN EARLIER OCCASION. BEING SO, TAKING A CONSISTENT VI EW, IN CONSONANCE WITH THE EARLIER DECISION OF THE TRIBUNA L, WE ARE INCLINED TO DIRECT THE DIT(E) TO GRANT REGISTRATION U/S. 12AA OF THE ACT. 6. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 18 TH MARCH, 2014. SD/- (ASHA VIJAYARAGHAVAN) JUDICIAL MEMBER SD/- (CHANDRA POOJARI) ACCOUNTANT MEMBER HYDERABAD, DATED THE 18 TH MARCH, 2014 TPRAO ITA NO. 1471/HYD/2013 M/S. KURELLA HARIHARA SWAMY AND GAYATHRI DEVI CHARITABLE TRUST ============================ 4 COPY FORWARDED TO: 1. M/S. KURELLA HARIHARA SWAMY AND GAYATHRI DEVI CHARITABLE TRUST, D. NO. 1-2-593/31, FLAT NO. 502, LEGEND, ST. NO. 5, GAGANMAHAL COLONY, DHOMALAGUDA, HYDERABAD. 2. THE DIRECTOR OF INCOME-TAX (EXEMPTIONS) (I/C), AA YAKAR BHAVAN, HYDERABAD. 3. THE DDIT(E)-I , , HYDERABAD. 4. THE DR BENCH 'A', ITAT, HYDERABAD