Sriniwas Banwarilal Saraf Charitable Trust, Kolkata V. CIT(Exemption), Kolkata, Kolkata

ITA 1632/KOL/2018

• Counselvise Citation: [2018] 119 COUNSELVISE.COM (IT) 5317 (ITAT-KOLKATA)
• Duration Of Justice: 2 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-10-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: misc
• Appeal Filed On: 29-07-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MD USMAN
• Assessee Lawyers: S JHAJHARIA AR SHRI SUJOY SEN
• Keywords: Charitable institution
• Section: 12AA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH : KOLKATA [BEFORE HONBLE SHRI S.S. GODARA, JM & SHRI M.BAL AGANESH, AM ] I.T.A NO. 1632/KOL/20 18 ASSESSMENT YEAR : SRINIWAS BANWARILAL SARAF CHARITABLE TRUST -VS- CIT(E), KOLKATA. [PAN: AANTS 7662 P] (APPELLANT) (RESPONDENT) FOR THE APPELLANT : SHRI S. JHAJ HARIA, AR SHRI SUJOY SEN, AR FOR THE RESPONDENT : SHRI MD. USMAN, C IT DR DATE OF HEARING : 29.08.2018 DATE OF PRONOUNCEMENT : 12.10.2018 ORDER PER S.S. GODARA, JM 1. THIS ASSESSEES APPEAL CHALLENGES CORRECTNESS OF THE CIT(E)-KOLKATAS ORDER DATED 07.06.2018 PASSED IN CASE NO. CIT(E)/KOL/10E/554/20 16-17/17-18/729 REJECTING ITS REGISTRATION INVOLVING PROCEEDINGS U/S 254/12AA OF INCOME TAX ACT, 1961 (IN SHORT THE ACT). HEARD BOTH THE PARTIES QUA THE SOLE ISSUE OF ASSES SEES SECTION 12AA REGISTRATION AS A CHARITABLE TRUST. CASE FILE PERUSED. 2 ITA NO.1632/KOL/2018 SRINIWAS BANWARILAL SARAF CHARITABLE TRUST A.YR. 2 2. IT EMERGES FROM THE CASE FILE THAT THIS IS A SEC OND ROUND OF LITIGATION QUA THE VERY ISSUE OF SECTION 12AA REGISTRATION BETWEEN THE PART IES. THE ASSESSEE HEREIN IS A TRUST SET UP AS PER DEED OF INDENTURE MADE ON 31.12.2013. ITS OBJECTS READ AS UNDER: A) TO ESTABLISH AND GIVE GRANT AND OR AID TO HOSPI TALS, CLINICS, DISPENSARIES, NURSING HOMES AND OR ANY OTHER INSTITUTIONS, ORGANIZATIONS, AND OR ESTABLISHMENT FOR GIVING MEDICAL RELIEF TO THE NEEDY AND OR FOR RESEARCH IN MEDICAL SCIENCES. B) TO PROVIDE FOOD, WATER, CLOTHING AND OR SHELTER TO THE NEEDY AND TO GIVE ALMS TO THEM EITHER IN CASH OR IN KIND OR OTHERWISE. C) TO ESTABLISH AND GIVE GRANT AND OR AID TO SCHOOL S, COLLEGES, HOSTELS , BOARDING HOUSES, LIBRARIES, READING ROOMS AND OR OTHER EDUCATIONAL I NSTITUTIONS FOR THE FURTHERANCE OF EDUCATION AND DIFFUSION OF KNOWLEDGE. D) TO ESTABLISH AND GIVE GRANT AND OR AID TO PUBLIC REST HOUSES AND OR DHARAMSHALLAS AND TO ARRANGE FREE PRASAD AND BHOG FOR THE BENEFIT OF THE PILGRIMS OR NEEDY PUBLIC. E) TO GRANT AID AND PROVIDE ASSISTANCE TO POOR AND OTHER DESERVING PERSONS IN CASH OR IN KIND OR OTHERWISE AND TO PAY STIPENDS, SCHOLARSH IP AND OTHER AID FOR PROSECUTING STUDIES, TRAINING, RESEARCH OR FACILITATING SELF-EM PLOYMENT. F) TO GRANT AID TO POOR, ORPHANS, WIDOWS, HANDICAPP ED AND OTHER DESERVING PERSONS AND PROVIDE ASSISTANCE TO THEM OF ALL KIND. G) TO ESTABLISH AND GIVE GRANT AND OR AID TO ORPHAN AGES, WIDOW HOMES, OLD AGE HOMES, LUNATIC ASYLUMS, POOR HOUSES ETC. H) TO START MAINTAIN OR ASSIST MEASURES IN THOSE AR EAS WHICH ARE OR BECOME SUBJECT TO NATURAL CALAMITIES FAMINE, EPIDEMICS, DRAUGHT, FLOO D, FIRE, EARTHQUAKES, LANDSLIDE ETC. AND EITHER CALAMITIES OF SIMILAR NATURE. I) TO RENOVATE OR REPAIR ANY SUCH TEMPLE, MOSQUE, G URUDWARA, CHURCH OR OTHER PLACE WHICH IS NOTIFIED BY ANY GOVERNMENT TO BE OF HISTOR IC ARCHEOLOGICAL, HERITAGE OR ARTISTIC IMPORTANCE OR TO BE A PLACE OF PUBLIC WORSHIP OF RE NOWN THROUGHOUT ANY STATE OF STATES. J) TO GRANT AID AND OR ASSISTANCE OF KIND TO ANY FU ND, OBJECT INSTITUTION, ORGANIZATION, ESTABLISHMENT ENGAGED IN ADVANCEMENT OF ANY PUBLIC CHARITABLE PURPOSES AS AFORESAID. 3 ITA NO.1632/KOL/2018 SRINIWAS BANWARILAL SARAF CHARITABLE TRUST A.YR. 3 3. THE ASSESSEE FILED ITS SECTION 12AA REGISTRATION ON 30.09.2016 IN FORM 10A OF THE ACT. THE CIT(E) DECLINED THE SAME IN HIS ORDER DATE D 11.01.2017 ON ACCOUNT OF IMPROPER REGISTRATION FORM. THE ASSESSEE FILED I.T. A. NO. 699/KOL/2017 BEFORE THIS TRIBUNAL. A CO-ORDINATE BENCHS ORDER DATED 31.08.2 017 RESTORED THE MATTER BACK TO THE CIT(E) FOR AFRESH ADJUDICATION. 4. THE CIT(E) TOOK UP CONSEQUENTIAL PROCEEDINGS THE REAFTER CULMINATING IN HIS ORDER UNDER CHALLENGE REJECTING ASSESSEES REGISTRATION A PPLICATION. HIS SOLE REASON FOR DENYING THE IMPUGNED REGISTRATION BEFORE US IS THAT THE AS SESSEE HAS AVOIDED PAYMENT OF TAX BY MAKING INELIGIBLE EXEMPTION CLAIM REGARDING ITS INC OME AS PER INCOME AND EXPENDITURE ACCOUNT OF RS. 3,24,209/- ALONG WITH CORPUS DONATIO N RECEIPT TO THE TUNE OF RS. 47 LACS AGGREGATING TO RS. 15,24,209/-. HE THEREFORE HOLDS THAT THE ASSESSEE IS NOT ENTITLED FOR THE IMPUGNED REGISTRATION AS ITS ACTIVITIES ARE NOT GENUINE. LEARNED CITDR VEHEMENTLY CONTENDS DURING THE COURSE OF HEARING THAT THE CIT( E) HAS RIGHTLY DENIED THE ASSESSEE ITS REGISTRATION SOUGHT U/S 12AA OF THE ACT IN VIEW OF OVERWHELMING EVIDENCE OF IT HAVING AVOIDED PAYMENT OF TAX. WE FIND NO REASON TO SUSTAI N THIS SOLE ARGUMENT RAISED AT THE REVENUES BEHEST. HONBLE MADRAS HIGH COURTS DECI SION IN DIT(E) VS. SEERVI SAMAJ TAMBARAM TRUST [2014] 271 CTR (MAD) 684 AS WELL AS HONBLE APEX COURT DECISION IN CIT VS. SREE ANJANEYA MEDICAL TRUST [2016] 74 TAX MANN.COM 243 (SC) HOLD THAT THE CIT(E) IS REQUIRED TO VERIFY OBJECTS OF THE TRUST A S TO WHETHER THE SAME ARE COVERED WITHIN THE SPECIFIED PRESCRIBED CHARITABLE ACTIVITI ES OR GENERAL PUBLIC UTILITY U/S 2(15) OF THE ACT. COMING TO THE REVENUES STAND REGARDING CO RPUS DONATION (SUPRA), THERE CAN HARDLY BE ANY DISPUTE THAT THE SAME COMES WITH A RI DER OF ITS UTILIZATION FOR SPECIFIC DIRECTION U/S 11(1)(D) OF THE ACT. THERE IS NO OTHE R REASON FORTHCOMING IN THE CIT(E)S ORDER UNDER CHALLENGE. WE THEREFORE HOLD THE ASSESS EE TO BE COVERED UNDER SPECIFIC LIMBS OF CARRYING OUT BOTH EDUCATION AND MEDICAL R ELIEF ACTIVITIES FOLLOWED BY GENERAL PUBLIC UTILITY ENTITLED FOR SECTION 12AA REGISTRATI ON. IT IS MADE CLEAR THAT OUR INSTANT ADJUDICATION IS CONFINED TO ASSESSEES REGISTRATION GRIEVANCE ONLY. WE FURTHER MAKE IT 4 ITA NO.1632/KOL/2018 SRINIWAS BANWARILAL SARAF CHARITABLE TRUST A.YR. 4 CLEAR THAT THE ASSESSING AUTHORITY SHALL BE AT LIBE RTY TO EXAMINE ASSESSEES APPLICATION OF INCOME IN APPROPRIATE PROCEEDINGS AS PER LAW. 5. THE ASSESSEES APPEAL IS ALLOWED IN ABOVE TERMS. ORDER PRONOUNCED IN THE COURT ON 12.10.2018 SD/- SD/- [M. BALAGANESH] [ S.S.GODARA ] ACCOUNTANT MEMBER JUDICIAL MEM BER DATED : 12.10.2018 SB, SR. PS COPY OF THE ORDER FORWARDED TO: 1. SRINIWAS BANWARILAL SARAF CHARITABLE TRUST, 571 , NEW ALIPUR, BLOCK-N, KOLKATA- 700053. 2. CIT(E), KOLKATA, 10B, MIDDLETON ROW, 6 TH FLOOR, KOLKATA-700071. 3..C.I.T(A).- 4. C.I.T.- KOLKATA. 5. CIT(DR), KOLKATA BENCHES, KOLKATA. TRUE COPY BY ORDER SENIOR PRIVAT E SECRETARY HEAD OF OFFICE/D.D.O., ITAT, KOLKATA BENCHE S