M/s. Shekinah Welfare Trust, CHENNAI V. ITO, Coimbatore

ITA 1574/CHNY/2011

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 1071 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 5 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-03-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 05-03-2013
• Assessment Year: misc
• Appeal Filed On: 20-09-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: S SRIDHAR
• Section: 12A; 12AA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH : CHENNAI [BEFORE SHRI N.S. SAINI, ACCOUNTANT MEMBER AND SHRI CHALLA NAGENDRA PRASAD, JUDICIAL MEMBER] I.T.A.NO.1574/MDS/2011 ASSESSMENT YEAR : N.A M/S SHEKINAH WELFARE TRUST C/O SHRI S. SRIDHAR, ADVOCATE NEW NO.14, OLD NO.82, FLAT NO.5 1 ST AVENUE, INDIRA NAGAR ADYAR, CHENNAI 600 020 VS THE INCOME TAX OFFICER COMPANY WARD I COIMBATORE [PAN AAKTS 0862 N] (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI S. SRIDHAR, ADVOCATE RESPONDENT BY : SHRI SHAJI P. JACOB, ADDL. CIT DATE OF HEARING : 05-03-2013 DATE OF PRONOUNCEMENT : 08-03-2013 O R D E R PER N.S. SAINI, ACCOUNTANT MEMBER THIS IS AN APPEAL FILED BY THE AS SESSEE AGAINST THE ORDER OF THE CIT-I, COIMBATORE, DATED 27.7.2011. 2. THE SOLE ISSUE INVOLVED IN THIS APPEAL IS THAT TH E CIT ERRED IN REJECTING THE APPLICATION FOR REGISTRATION U/S 12AA OF THE ACT. I.T.A.NO. 1574/11 :- 2 -: 3. AT THE TIME OF HEARING, THE A.R OF THE ASSESSEE SU BMITTED THAT THE APPLICATION FOR REGISTRATION OF THE TRUST WAS REJECTED BY THE CIT-I, COIMBATORE, WITHOUT ALLOWING ANY OPPORTUNITY OF HEARING TO THE ASSESSEE BY OBSERVING THAT THE TRUST DEED SPEAKS OF CARRYING OUT ALL ACTIVITIES PROVIDED U/S 2(15) OF THE ACT AND DOES NOT SPELL OUT MAIN/SPECIFIC OBJECT OF PUBLIC CHARITY AND THEREFOR E, IT LACKS SERIOUS OF INTENTION TO CARRY OUT CHARITABLE ACTIVITIES BY THE TRUST. THE CIT HAS ALSO OBSERVED THAT THE TRUST HAS CLAIMED TO HAVE MA DE SOME MONETARY CONTRIBUTIONS TO POOR STUDENTS WHICH ARE NOT CROSS VERIFIABLE AS TO ITS VERACITY. IT WAS HIS SUBMISSION THAT THE CIT SHOUL D HAVE ALLOWED OPPORTUNITY TO THE ASSESSEE TO EXPLAIN ITS CASE BE FORE HIM IF HE HAD ANY DOUBT OR QUERIES WITH REGARD TO THE OBJECT OF T HE TRUST AND THE ACTIVITIES OF THE TRUST. THUS, NOT ALLOWING PROPER OPPORTUNITY OF HEARING WAS IN VIOLATION OF PRINCIPLES OF NATURAL J USTICE. HENCE, HE PRAYED THAT THE MATTER SHOULD BE REMANDED BACK TO T HE FILE OF THE CIT TO READJUDICATE THE ISSUE OF GRANTING REGISTRATION U/S 12AA OF THE ACT TO THE ASSESSEE-TRUST AFRESH AFTER ALLOWING PROPER OPPORTUNITY OF HEARING TO THE ASSESSEE. 4. THE DR DID NOT HAVE ANY OBJECTION TO THE ABOVE SUBM ISSIONS MADE BY THE A.R. I.T.A.NO. 1574/11 :- 3 -: 5. AFTER CONSIDERING THE RIVAL SUBMISSIONS, WE FIND FR OM THE ORDER OF THE CIT THAT HE HAS REJECTED THE APPLICATI ON FOR REGISTRATION U/S 12AA OF THE ACT TO THE ASSESSEE BY OBSERVING T HAT THE ASSESSEE HAS NOT SPELT OUT ANY SPECIFIC OBJECT IN THE NATURE OF PUBLIC CHARITY IN THE TRUST DEED AND THAT THE CLAIM OF THE ASSESSEE THAT IT HAS MADE CONTRIBUTIONS TO POOR STUDENTS ARE NOT CROSS VERIFI ABLE AS TO ITS VERACITY. WE FIND THAT NO SHOW CAUSE NOTICE WAS ISSUED TO THE ASSESSEE FOR EXPLAINING THE QUERIES BY THE CIT. THUS, NO OPPORT UNITY OF HEARING WAS GRANTED TO THE ASSESSEE BEFORE REJECTING ITS A PPLICATION FOR REGISTRATION U/S 12AA OF THE ACT. THEREFORE, IN O UR CONSIDERED OPINION, IT SHALL BE JUST AND FAIR TO REMAND THE MA TTER BACK TO THE FILE OF THE CIT FOR ADJUDICATING THE ISSUE OF GRANTING O F REGISTRATION TO THE ASSESSEE-TRUST U/S 12AA OF THE ACT AS PER LAW AFTE R ALLOWING REASONABLE AND PROPER OPPORTUNITY OF HEARING TO THE ASSESSEE HE SHALL, THEREAFTER, PASS A SPEAKING ORDER CONSIDERIN G THE SUBMISSIONS OF THE ASSESSEE FOR GRANTING OF REGISTRATION U/S 12A A OF THE ACT TO THE TRUST AS WELL AS AFTER CONSIDERING THE OBJECT CLAUS E OF THE TRUST DEED. THUS, THE GROUNDS OF APPEAL OF THE ASSESSEE ARE AL LOWED FOR STATISTICAL PURPOSES. I.T.A.NO. 1574/11 :- 4 -: 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE I S ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON FRIDAY, THE 08 TH OF MARCH, 2013, AT CHENNAI. SD/- SD/- (CHALLA NAGENDRA PRASAD) JUDICIAL MEMBER (N.S.SAINI) ACCOUNTANT MEMBER DATED: 08 TH MARCH, 2013 RD COPY TO: APPELLANT/RESPONDENT/CIT(A)/CIT/DR