AL-Habeeb Educational & Charitable Trust, Kalaburagi V. Commissioner of Income Tax, Bangalore

ITA 1484/BANG/2016

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 7266 (ITAT-BANGALORE)
• Duration Of Justice: 1 year(s) 2 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-11-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 03-08-2017
• Assessment Year: misc
• Appeal Filed On: 16-08-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SUNIL KUMAR S INGH I
• Keywords: Charitable institution; Opportunity of being heard; Principle of natural justice
• Section: 80G; 12AA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH : BANGALORE BEFORE SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI JASON P. BOAZ, ACCOUNTANT MEMBER ITA NO. 1483 & 1484/BANG/2016 ASSESSMENT YEAR : N.A. AL-HABEEB EDUCATIONAL & CHARITABLE TRUST, HABEEB ESTATE, MILATH NAGAR, RING ROAD, KALABURGI 585 104. PAN: AAETA 1038Q VS. THE COMMISSIONER OF INCOME TAX (EXEMPTIONS), BENGALURU. APP ELLANT RESPONDENT APP ELLANT BY : SHRI G. VENKATESH , ADVOCATE RESPONDENT BY : SHRI SUNIL KUMAR S INGH, CIT(DR) - I DATE OF HEARING : 07.11.2017 DATE OF PRONOUNCEMENT : 10 .11.2017 O R D E R PER SUNIL KUMAR YADAV, JUDICIAL MEMBER THESE APPEALS ARE PREFERRED BY THE ASSESSEE AGA INST THE RESPECTIVE ORDER OF THE CIT(EXEMPTIONS) PASSED U/S. 12AA(1)(B)(II) AND 80G(5)(VI) OF THE INCOME-TAX ACT, 1961 [THE ACT]. 2. THE GROUNDS OF APPEAL RAISED IN THESE APPEALS A RE EXTRACTED HEREUNDER FOR THE SAKE OF REFERENCE:- ITA NO.1483/BANG/2016 1. THE IMPUGNED ORDER OF THE COMMISSIONER OF INCOM E TAX (EXEMPTIONS), BENGALURU, PASSED UNDER SECTION 12AA( 1) OF THE ITA NOS.1483 & 1484/BANG/2016 PAGE 2 OF 5 INCOME TAX ACT, 1961 IS OPPOSED TO LAW, WEIGHT OF E VIDENCE, PROBABILITIES, FACTS AND CIRCUMSTANCES OF THE APPEL LANT'S CASE. 2. THE LEARNED COMMISSIONER OF INCOME TAX (EXEMPTI ONS) HAS COMPLETELY DISREGARDED THE OBJECTS OF THE APPEL LANT TRUST AS CONTAINED IN THE DEED OF TRUST AND FAILED TO APPREC IATE THAT THE APPELLANT TRUST IS ESTABLISHED ONLY FOR CHARITABLE PURPOSES. 3. THE LEARNED COMMISSIONER OF INCOME TAX (EXEMPTI ONS) OUGHT TO HAVE CONSIDERED THE DOCUMENTS AND MATERIAL S ALREADY BROUGHT ON RECORD WHICH WERE ADEQUATE TO EXAMINE AN D DECIDE ON THE GENUINENESS OF THE ACTIVITIES OF THE APPELLANT ON THE FACTS AND CIRCUMSTANCES OF THE CASE. 4. THE LEARNED COMMISSIONER OF INCOME TAX (EXEMPTI ONS) IS NOT JUSTIFIED IN HOLDING THAT THE APPELLANT HAS NOT PRODUCED THE AMENDED TRUST DEED AND OTHER DOCUMENTS HENCE THE GE NUINENESS OF THE ACTIVITIES CANNOT BE VERIFIABLE AND CONSEQUE NTLY REJECTING THE APPLICATION FOR REGISTRATION U/ S 12AA OF THE A CT ON THE FACTS AND CIRCUMSTANCES OF THE CASE. 5. THE LEARNED COMMISSIONER OF INCOME TAX (EXEMPTI ONS) OUGHT TO HAVE APPRECIATED THAT THE NECESSARY DOCUME NTS WERE SUBMITTED TO THE OFFICE OF THE CIT(E), ON THE FACTS AND CIRCUMSTANCES OF THE CASE. 6. WITHOUT PREJUDICE, THE COMMISSIONER OF INCOME T AX (EXEMPTIONS) IS NOT JUSTIFIED IN PASSING THE ORDER UNDER SECTION 12AA(1) OF THE ACT WITHOUT PROVIDING ADEQUATE OPPOR TUNITY TO THE APPELLANT OF BEING HEARD AND THUS THE IMPUGNED ORDER IS PASSED IN VIOLATION OF PRINCIPLES OF NATURAL JUSTIC E. 7. THE APPELLANT CRAVES FOR LEAVE OF THIS HON'BLE TRIBUNAL, TO ADD, ALTER, DELETE, AMEND OR SUBSTITUTE ANY OR ALL OF THE ABOVE GROUNDS OF APPEAL AS MAY BE NECESSARY AT THE TIME O F HEARING. 8. FOR THESE AND OTHER GROUNDS THAT MAY BE URGED A T THE TIME OF HEARING OF APPEAL, THE APPELLANT PRAYS THAT THE APPEAL MAY BE ALLOWED FOR THE ADVANCEMENT OF SUBSTANTIAL CAUSE OF JUSTICE AND EQUITY. ITA NOS.1483 & 1484/BANG/2016 PAGE 3 OF 5 ITA NO.1484/BANG/2016 1. THE IMPUGNED ORDER OF THE COMMISSIONER OF INCO ME TAX, GULBARGA, PASSED UNDER SECTION 80G(5) OF THE INCOME TAX ACT, 1961 IS OPPOSED TO LAW, WEIGHT OF EVIDENCE, PROBABI LITIES, FACTS AND CIRCUMSTANCES OF THE APPELLANT' S CASE. 2. THE LEARNED COMMISSIONER OF INCOME TAX (EXEMPTI ONS) HAS COMPLETELY DISREGARDED THE OBJECTS OF THE APPEL LANT TRUST AS CONTAINED IN THE DEED OF TRUST AND FAILED TO APPREC IATE THAT THE APPELLANT TRUST IS ESTABLISHED ONLY FOR CHARITABLE PURPOSES. 3. THE LEARNED COMMISSIONER OF INCOME TAX (EXEMPTI ONS) OUGHT TO HAVE CONSIDERED THE DOCUMENTS AND MATERIAL S ALREADY BROUGHT ON RECORD WHICH WERE ADEQUATE TO EXAMINE AN D DECIDE ON THE GENUINENESS OF THE ACTIVITIES OF THE APPELLANT ON THE FACTS AND CIRCUMSTANCES OF THE CASE. 4. THE LEARNED COMMISSIONER OF INCOME TAX (EXEMPTI ONS) IS NOT JUSTIFIED IN HOLDING THAT THE APPELLANT HAS NOT PRODUCED THE AMENDED TRUST DEED AND HENCE THE GENUINENESS OF THE ACTIVITIES CANNOT BE VERIFIABLE AND THEREBY REJECTING THE REGI STRATION U/ S 12AA OF THE ACT AND CONSEQUENTLY REJECTING THE APPL ICATION FOR RECOGNITION U/S 80G OF THE ACT ON THE FACTS AND CIR CUMSTANCES OF THE CASE. 5. THE LEARNED COMMISSIONER OF INCOME TAX (EXEMPTI ONS) OUGHT TO HAVE APPRECIATED THAT THE NECESSARY DOCUME NTS WERE SUBMITTED TO THE OFFICE OF CIT(E), ON THE FACTS AN D CIRCUMSTANCES OF THE CASE. 6. WITHOUT PREJUDICE, THE COMMISSIONER OF INCOME TA X (EXEMPTIONS) IS NOT JUSTIFIED IN PASSING THE ORDER UNDER SECTION 80G(5) OF THE ACT WITHOUT PROVIDING ADEQUATE OPPORT UNITY TO THE APPELLANT OF BEING HEARD AND THUS THE IMPUGNED ORDE R IS PASSED IN VIOLATION OF PRINCIPLES OF NATURAL JUSTICE. 7. THE APPELLANT CRAVES FOR LEAVE OF THIS HON'BLE TRIBUNAL, TO ADD, ALTER, DELETE, AMEND OR SUBSTITUTE ANY OR ALL OF THE ABOVE GROUNDS OF APPEAL AS MAY BE NECESSARY AT THE TIME O F HEARING. 8. FOR THESE AND OTHER GROUNDS THAT MAY BE URGED A T THE TIME OF HEARING OF APPEAL, THE APPELLANT PRAYS THAT THE APPEAL MAY BE ITA NOS.1483 & 1484/BANG/2016 PAGE 4 OF 5 ALLOWED FOR THE ADVANCEMENT OF SUBSTANTIAL CAUSE OF JUSTICE AND EQUITY. 3. THE FACTS IN BRIEF BORNE OUT FROM THE RECORD ARE THAT THE CIT(EXEMPTIONS) HAS DENIED REGISTRATION U/S. 12AA O F THE ACT ON THE GROUND THAT ASSESSEE HAS NOT FURNISHED RELEVANT INF ORMATION AND THE EVIDENCE OF CHARITABLE ACTIVITIES UNDERTAKEN BY THE ASSESSEE. SINCE THE REGISTRATION U/S. 12AA WAS DENIED, THE CIT(E) ALSO DENIED RECOGNITION U/S. 80G(5)(VI) OF THE ACT. 4. DURING THE COURSE OF HEARING, THE LD. COUNSEL F OR THE ASSESSEE HAS INVITED OUR ATTENTION THAT HE HAS FILED COMPLETE DE TAILS BEFORE THE CIT(E), BUT HE DID NOT TAKE IT INTO ACCOUNT AND DISMISSED T HE APPLICATION FOR REGISTRATION SUMMARILY. IN SUPPORT OF HIS CONTENTI ON, HE INVITED OUR ATTENTION TO THE PAPERBOOK WITH THE SUBMISSION THAT DETAILED EVIDENCE WAS FILED BEFORE THE CIT(E) DURING THE COURSE OF HEARING, BUT HE DID NOT TAKE COGNIZANCE OF THE SAME AND REJECTED THE APPLICATION FOR REGISTRATION. THEREFORE, THE MATTER BE SENT BACK TO THE CIT(E) TO ADJUDICATE THE ISSUE AFRESH IN THE LIGHT OF EVIDENCE FILED BY THE ASSESS EE. 5. THE LD. DR PLACED RELIANCE UPON THE ORDER OF CIT (E). 6. HAVING CAREFULLY EXAMINED THE ORDERS OF LOWER AU THORITIES AND THE PAPERBOOK FILED BY THE ASSESSEE, WE FIND THAT IN TH E PAPERBOOK THE ASSESSEE HAS GIVEN A CERTIFICATE THAT HE HAS FILED ALL RELEVANT EVIDENCE BEFORE THE CIT(E). THE PAPERBOOK COMPRISES OF COPY OF APPLICATION FOR REGISTRATION, AUDITED STATEMENT OF ACCOUNTS FOR THE FY 2013-14 TO 2014-15, COPY OF ORIGINAL TRUST DEED AND AMENDED TRUST DEED, LIST OF TRUSTEES, COPY OF PAN CARD, COPIES OF PHOTOGRAPHS SHOWING THE ACTIVIT IES OF THE TRUST, ETC. THESE EVIDENCE WERE NOT TAKEN INTO ACCOUNT BY THE C IT(E). IN THE LIGHT OF THESE FACTS, WE ARE OF THE VIEW THAT THE CIT(E) HAS NOT APPLIED HIS MIND PROPERLY TO THE FACTS OF THE CASE AND HAS REJECTED THE APPLICATION FOR ITA NOS.1483 & 1484/BANG/2016 PAGE 5 OF 5 REGISTRATION U/S. 12AA SUMMARILY. THEREFORE, WE SE T ASIDE HIS ORDER PASSED U/S. 12AA AND 80G(5)(VI) OF THE ACT AND RESTORE TH E MATTER TO HIS FILE WITH A DIRECTION TO READJUDICATE THE APPLICATION FOR REGIS TRATION U/S. 12AA AND APPLICATION FOR RECOGNITION U/S. 80G(5)(VI) OF THE ACT AFRESH IN THE LIGHT OF EVIDENCE FURNISHED BY THE ASSESSEE, AFTER AFFORDING OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 7. IN THE RESULT, THE APPEALS OF THE ASSESSEE ARE A LLOWED FOR STATISTICAL PURPOSES. PRONOUNCED IN THE OPEN COURT ON THIS 10 TH DAY OF NOVEMBER, 2017. SD/- SD/- ( JASON P. BOAZ ) ( SUNIL KUMAR YADAV ) ACCOUNTANT M EMBER JUDICIAL MEMBER BANGALORE, DATED, THE 10 TH NOVEMBER, 2017. / D ESAI S MURTHY / COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT, BANGALORE. 6. GUARD FILE BY ORDER SENIOR PRIVATE SECRETARY ITAT, BANGALORE.