KANYAKUBJ SABHA, RAIPUR V. COMMISSIONER OF INCOME TAX(EXEMPTION) , BHOPAL

ITA 16/RPR/2019

• Counselvise Citation: [2022] 106 COUNSELVISE.COM (IT) 4829 (ITAT-RAIPUR)
• Duration Of Justice: 3 year(s) 8 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-09-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: misc
• Appeal Filed On: 09-01-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 12; 2; 11; 12A; 12AA; 13

Judgement Text

आयकर अऩीऱीय अधधकरण, रायऩ ु र न्यायऩीठ, रायऩ ु र IN THE INCOME TAX APPELLATE TRIBUNAL RAIPUR BENCH, RAIPUR श्री रविश स ू द, न्याययक सदस्य एवं श्री अरुण खोड़वऩया, ऱेखा सदस्य के समक्ष । BEFORE SHRI RAVISH SOOD, JM & SHRI ARUN KHODPIA, AM आयकर अऩीऱ सं./ITA No.16/RPR/2019 (ननधाारण वषा / Assessment Year : NA) Kanyakubj Sabha Raipur, Pt. Ravishanker Shukla, Kanyakubj Chhatravas, Byron Bazar, Raipur Vs CIT(Exemption), Bhopal PAN No. : AACTK 4634 L (अऩीऱाथी /Appellant) .. (प्रत्यथी / Respondent) ननधााररती की ओर से /Assessee by : Shri R.B.Doshi, CA राजस्व की ओर से /Revenue by : Shri P.K.Mishra, CIT-DR स ु निाई की तारीख / Date of Hearing : 27/07/2022 घोषणा की तारीख/Date of Pronouncement : 21/09/2022 आदेश / O R D E R Per Arun Khodpia, AM : This appeal is filed by the assessee against the order passed by the CIT(E), Bhopal, dated 28.11.2018, on the following sole ground :- 1. In the facts and circumstances of the case and in law, Ld. CIT (Exemption) was not justified in holding that the appellant is not entitled for registration u/s 12AA and he erred in rejecting the application seeking registration u/s 12AA. The appellant is entitled for approval u/s 12AA. 2. Brief facts of the case are that the assessee applied for registration u/s.12AA of the Act in Form No.10A, however, the CIT(E) refused to grant registration stating that the assessee society has not carried out any charitable activity for public at large. 3. Against the rejection of application of the assessee for registration u/s.12AA of the Act by the CIT(E), the assessee is now in appeal before the Tribunal. ITA No.16/RPR/2019 2 4. Ld. AR before us contended that as per the bye laws of society, the objects and activities are not limited to assessee society only but to whole public at large. Ld. AR submitted that considering the objects and activities of the society, the assessee society is entitled for registration u/s.12AA of the Act. Also, rejection of the application of assessee society by triggering provisions of section 13(1)(b) of the Act was not called for, since, explanation 2 of the section 13 explains that “A trust or institution created or established for the benefit of Scheduled caste, backward classes, Scheduled Tribes or women and children shall not be deemed to be a trust or institution created or established for the benefit of a religious community or caste within the meaning of clause (b) of subsection (1)”, It means a trust or institution created or established for the benefit of Schedule castes, schedule tribes or backward classes then such trust or institution cannot be denied exemption u/s 11 or 12 of the I.T.Act by invoking provisions of section 13(1)(b). Ld AR in this respect relied on the order of coordinate bench of ITAT Raipur in ITA no 50/RPR/2018 dated 16.01.2019 in the case of Shree Vimalnath Jain Swetamber Mandir Trust, Raipur, wherein identical issue was raised by the assessee against the order of CIT(E) was decided in favour of the assessee. Since the issue is already decided by the Raipur Bench in the similar circumstances, the present case is squarely covered by the same and therefore it preyed by the Ld AR to set aside the order of Ld CIT(E) and direct him to grant registration u/s 12AA of the Act. ITA No.16/RPR/2019 3 5. On other hand, ld. CIT. DR relied on the order of ld. CIT(E) and submitted that the Ld CIT(E) has rightly rejected the application in form 10A of the assessee society since the same was for the benefit of a particular community, therefore attracts provision of section 13(1)(b) of the IT Act. Therefore the CIT(E) has rightly refused the registration sought u/s 12AA and order of the Ld CIT(E) needs to be upheld. 6. We have heard rival submissions, perused the material evidence available on record and judicial pronouncement relied upon by the Ld AR. It is observed that the registration under section 12A was denied to the assessee society on the ground that the assessee society is established for a particular Community and almost objects are for the benefit of a particular community. The ld. CIT(E) also noted that the assessee has also not furnished any details or evidences regarding the charitable work carried out by the assessee before him and the main objects of the society are for the benefit of “Kanya Kubj Samaj”, which is a sub- community in the Brahmin Community belonging to Kanya Kubj Gotra. 7. Regarding duties of CIT(E) to be performed with respect to procedure for registration u/s 12AA(1)(a) and (b) Hon'ble Rajasthan High Court in the case of CIT Vs. Vijay Vargiya Charitable Trust in ITA No. 17/2014 has categorically held that at the time of granting registration, the objects of the Trust for which it was formed, is only to be looked into and the CIT’s satisfaction about genuineness of activities of the Trust was not criteria as the Trust was just commencing activities. Hence the issue regarding satisfaction or genuineness of the activities of the trust is not a ITA No.16/RPR/2019 4 matter to be looked into at the time of granting registration u/s 12AA of the Act. 8. Regarding invoking provision of section 13(1)(b) coordinate bench of the ITAT Raipur in the case of Shree Vimalnath Jain Swetamber Mandir Trust (supra) has given the finding by respectfully following the observation of Coordinate bench of Pune in the case of Kul Foundation Vs. CIT in ITA no 1692/PN/2013 has held that where the conditions of section 13(1)(b) is attracted so to denying exemption u/s 11 and 12 of the Act is a matter to be looked into by the AO at the time of assessment proceedings. However, at the time of granting registration U/s 12AA of the Act, the main criteria which are to be looked into are: (i) Object of the Trust; (ii) Whether the trust has applied for registration u/s 12AA of the Act with proper details as enshrined in the Act. (iii) Whether the entire prescribed format for application as in the Act has been complied with; Accordingly, where the Trust attracts section 13 (1)(b) of the Act and therefore, not entitle to the claim of deduction u/s 11 and 12 of the Act is a matter of concern only at the time of assessment proceedings. 9. The Hon’ble Gujarat High Court in the case of Commissioner of Income Tax Vs. Barkate Saifiyah Society, reported in (1995) 213 ITR 492 (GUJ)/(1995) 78 TAXMAN 6, has held that the provisions of section 13(1)(b) will apply only to the Trust which are purely for charitable purposes. If the assessee Trust has objects in both charitable and religious in nature, in such Trust, Section 13(1)(b) is not applicable. On perusal of the bye-laws of the assessee society it is evident that the ITA No.16/RPR/2019 5 assessee society has charitable as well as religious objects, therefore, squarely covered by the judgment of the Hon’ble Gujarat High Court in the case of Barkate Saifiyah Society (supra). 10. In view of the aforesaid discussion and on the basis of careful perusal of the facts, submissions and judicial pronouncements available before us, we are of the considered opinion that registration to the assessee trust cannot be denied on the basis of observation of the CIT(E) as mentioned herein above, also in absence of any decision brought to our attention by the revenue contrary to the findings of the hon’ble judicial forums, we, therefore, respectfully following the findings of upper courts and coordinate benches of ITAT set aside the order of Ld CIT(E) and direct to grant registration u/s 12AA of the IT Act to the assessee. 11. In the result, the appeal of the assessee is allowed. Order pronounced in pursuance to Rule 34(4) of ITAT Rules, 1963 on 21/09/2022. Sd/- (RAVISH SOOD) Sd/- (ARUN KHODPIA) न्यानयक सदस्य / JUDICIAL MEMBER ऱेखा सदस्य / ACCOUNTANT MEMBER रायऩ ु र/Raipur; ददनाांक Dated 21/09/2022 Prakash Kumar Mishra, Sr.P.S. आदेश की प्रनतलऱपऩ अग्रेपषत/Copy of the Order forwarded to : आदेशान ु सार/ BY ORDER, (Assistant Registrar) आयकर अऩीऱीय अधधकरण, रायऩ ु र/ITAT, Raipur 1. अऩीऱाथी / The Appellant- 2. प्रत्यथी / The Respondent- 3. आयकर आय ु क्त(अऩीऱ) / The CIT(A), 4. आयकर आय ु क्त / CIT 5. विभागीय प्रयतयनधध, आयकर अऩीऱीय अधधकरण, रायऩ ु र/ DR, ITAT, Raipur 6. गार्ड पाईऱ / Guard file. सत्यावऩत प्रयत //True Copy//