M/s. Sri Sankaraa Trust, CHENNAI V. DIT, CHENNAI

ITA 1704/CHNY/2011

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 58135 (ITAT-CHENNAI)
• Duration Of Justice: 5 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-03-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 19-03-2012
• Assessment Year: misc
• Appeal Filed On: 17-10-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Charitable institution
• Section: 12AA; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH : CHENNAI [BEFORE SHRI N.S. SAINI, ACCOUNTANT MEMBER AND SHRI GEORGE MATHAN, JUDICIAL MEMBER] I.T.A.NO.1704/MDS/2011 M/S SRI SANKARAA TRUST #26, FIRST CROSS ROAD R.A.PURAM CHENNAI 600 028 VS THE DIRECTOR OF INCOME TAX (EXEMPTIONS) CHENNAI (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI PHILIP GEORGE, ADVOCATE RESPONDENT BY : SHRI SHAJI P. JACOB, ADDL. CIT DATE OF HEARING : 19-03-2012 DATE OF PRONOUNCEMENT : 23-3-2012 O R D E R PER N.S. SAINI, ACCOUNTANT MEMBER THIS IS AN APPEAL FILED BY THE ASSE SSEE-TRUST AGAINST THE ORDER OF THE DIRECTOR OF INCOME TAX (EXEMPTIONS), C HENNAI, DATED 29.6.2011. 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: 1. THE ORDER OF THE DIRECTOR OF INCOME TAX (EXEMPTIONS) IS OPPOSED TO LAW AND CONTRARY TO THE FACTS AND CIRCUMSTANCES OF THE CASE. 2. THE DIRECTOR OF INCOME TAX (EXEMPTIONS) GROSSLY ERRED IN REJECTING THE APPLICATION U/S. 10A FOR REGISTRATION U/S 12AA. I.T.A.NO. 1704/11 :- 2 -: 3. THE DIRECTOR OF INCOME TAX (EXEMPTIONS) GROSSLY ERRED IN OBSERVING THAT AS THE APPELLANT TRUST HAS MIXED OBJECTS PARTLY CHARITABLE AND PARTLY RELIGIOU S, APPELLANT IS NOT ENTITLED FOR REGISTRATION U/S 12AA OF INCOME TAX ACT, 1961. 4. THE DIRECTOR OF INCOME TAX (EXEMPTIONS) GROSSLY ERRED IN HIS INTERPRETATION OF SECTION 11 READ WITH SECTION 12AA. 5. THE DIRECTOR OF INCOME TAX (EXEMPTIONS) GROSSLY ERRED IN OBSERVING THAT FOR THE PURPOSE OF REGISTRATION U/S 12AA THERE SHOULD BE TWO DISTINCT TRUSTS FOR THE PURPOSES OF CHARITABLE AND RELIGIOUS NATURE. 6. THE DIRECTOR OF INCOME TAX (EXEMPTIONS) OUGHT TO HAVE APPRECIATED THAT EVEN IF THE APPELLANT IS HELD TO BE RELIGIOUS AND CHARITABLE TRUST, IT IS ENTITLED TO APPROVAL U/ S. 12AA. 7. THE DIRECTOR OF INCOME TAX (EXEMPTIONS) GROSSLY ERRED IN NOT GIVING SUFFICIENT OPPORTUNITY FOR FILI NG THE PARTICULARS ALLEGEDLY CALLED FOR. 8. THE DIRECTOR OF INCOME TAX (EXEMPTIONS) GROSSLY ERRED IN NOT APPRECIATING THAT PUBLICATION OF NEWSPAPERS IS ALSO CHARITABLE IN NATURE WHEN THE SAME ARE NOT CARRIED OUT WITH BUSINESS MOTIVE OR FO R COMMERCIAL PURPOSES. 9. THE APPELLANT CONTESTS ALL THE FINDINGS OF FACT AND LAW GIVEN AGAINST THE APPELLANT. 10. THE APPELLANT CRAVES LEAVE TO FILE ADDITIONAL GROUNDS OF APPEAL AT OR BEFORE THE TIME OF HEARING. 3. THE LD. A.R OF THE ASSESSEE SUBMITTED DURING TH E COURSE OF HEARING THAT THE ONLY GROUND ON WHICH REGISTRATION U/S 12AA OF THE ACT I.T.A.NO. 1704/11 :- 3 -: WAS REJECTED BY THE DIT(E) WAS THAT THE TRUST WAS H AVING MIXED ACTIVITIES OF BOTH CHARITABLE AND RELIGIOUS IN NAT URE. HE SUBMITTED THAT ITAT, COCHIN [THIRD MEMBER] IN THE CASE OF SOCIETY OF PRESENTATION SISTERS VS ITO, (2009) 121 ITD 422, HAS HELD THAT IN THE CASE WHERE THE TRUST WAS CARRYING ON MIXED ACTIVITIES WHICH WE RE CHARITABLE AND RELIGIOUS IN NATURE THEN REGISTRATION U/S 12AA COUL D NOT BE DENIED TO THE ASSESSEE-TRUST SUBJECT TO SATISFACTION OF OTHE R CONDITION. 4. ON THE OTHER HAND, THE LD. DR SUBMITTED THAT TH E DIT(E) HAS STATED AT PAGE 2 OF THE ORDER THAT THE ASSESSEE-TR UST HAS NOT SUBMITTED THE DETAILS OF ACTIVITIES DONE BY IT SO F AR. HE SUBMITTED THAT THE ASSESSEE-TRUST FILED ONLY DETAILS OF BANK WITH DRAWALS AND THAT IT HAD NOT EXPLAINED THE PURPOSE FOR WHICH THE BANK WI THDRAWALS WERE MADE AND NO EVIDENCE IN SUPPORT OF THE ACTIVITIES W AS FILED. THEREFORE, THE DIT(E) WAS JUSTIFIED IN DENYING REGISTRATION TO THE ASSESSEE. 5. IN REPLY TO THE SUBMISSION OF THE LD. DR, THE L D. A.R OF THE ASSESSEE SUBMITTED THAT IF AN OPPORTUNITY IS GRANTE D THEN THE ASSESSEE IS IN A POSITION TO FILE THE ACTIVITY REPORT OF THE ASSESSEE-TRUST BEFORE THE DIT(E). 6. THE LD. DR HAD NO OBJECTION IN REMANDING THE MAT TER BACK TO THE FILE OF THE DIT(E) FOR EXAMINING THE ACTIVITIES OF THE ASSESSEE-TRUST I.T.A.NO. 1704/11 :- 4 -: AND THEN CONSIDERING THE ISSUE OF GRANTING REGISTRA TION TO THE ASSESSEE-TRUST. 7. AFTER CONSIDERING THE RIVAL SUBMISSIONS AND PER USING THE ORDER OF THE DIT(E), WE ARE OF THE CONSIDERED VIEW THAT I N THE INTEREST OF JUSTICE, ONE MORE OPPORTUNITY SHOULD BE GRANTED TO THE ASSESSEE-TRUST TO FILE THE DETAILS OF ACTIVITIES UNDERTAKEN BY IT TILL DATE. TO THIS, THE LD. DR ALSO HAS NO OBJECTION. WE, THEREFORE, ALLOW THE PRAYER OF THE ASSESSEE AND SET ASIDE THE ORDER OF THE DIT(E) AND RESTORE THE MATTER BACK TO HIS FILE FOR ADJUDICATING THE ISSUE OF GRAN TING OF REGISTRATION U/S 12AA AFRESH AFTER VERIFYING THE DETAILS OF ACTIVITI ES OF THE ASSESSEE- TRUST UNDERTAKEN BY IT TILL DATE. NEEDLESS TO MENT ION THAT THE LD.DIT(E) SHALL ALLOW REASONABLE OPPORTUNITY OF HEARING TO TH E ASSESSEE BEFORE ADJUDICATING THE ISSUE AFRESH. THE ASSESSEE IS AL SO DIRECTED TO FILE ALL THE DETAILS OF ITS ACTIVITIES UNDERTAKEN TILL DATE AS AND WHEN CALLED UPON TO DO SO. THUS, THE GROUNDS OF APPEAL TAKEN BY THE ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. 8. IN THE RESULT, THE APPEAL FILED BY THE AS SESSEE-TRUST IS ALLOWED FOR STATISTICAL PURPOSES. I.T.A.NO. 1704/11 :- 5 -: ORDER PRONOUNCED IN THE OPEN COURT ON 23.3.2012. SD/- SD/- (GEORGE MATHAN) JUDICIAL MEMBER (N.S.SAINI) ACCOUNTANT MEMBER DATED: 23 RD MARCH, 2012 RD COPY TO: APPELLANT/RESPONDENT/CIT(A)/CIT/DR