M/s. E.D.Comforting Hands, CHENNAI V. ITO, Coimbatore

ITA 1724/CHNY/2012

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 64511 (ITAT-CHENNAI)
• Duration Of Justice: 1 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-11-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: misc
• Appeal Filed On: 14-09-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANIRUDH RAI
• Assessee Lawyers: S SRIDHAR
• Section: 12AA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, CHENNAI BEFORE SHRI ABRAHAM P. GEORGE, ACCOUNTANT MEMBER AND SHRI V. DURGA RAO, JUDICIAL MEMBER I.T.A. NO. 1724/MDS/2012 M/S E.D. COMFORTING HANDS, 19B, E.B. COLONY, TVS NAGAR, KAVUNDAMPALAYAM, COIMBATORE 641 025. PAN : AAATE4440J (APPELLANT) V. THE INCOME TAX OFFICER, COMPANY WARD I, COIMBATORE. (RESPONDENT) APPELLANT BY : SHRI S. SRIDHAR, ADVOCATE RESPONDENT BY : SHRI ANIRUDH RAI, CIT-DR DATE OF HEARING : 06.11.2012 DATE OF PRONOUNCEMENT : 06.11.2012 O R D E R PER ABRAHAM P. GEORGE, ACCOUNTANT MEMBER : IN THIS APPEAL FILED BY THE ASSESSEE, ITS GRIEVANC E IS THAT CIT REFUSED TO GIVE REGISTRATION UNDER SECTION 12AA OF INCOME-TAX ACT, 1961 (IN SHORT 'THE ACT'). 2. FACTS APROPOS ARE THAT ASSESSEE HAD FILED APPLIC ATION IN FORM NO.10A, SEEKING REGISTRATION UNDER SECTION 12AA OF THE ACT, ON I.T.A. NO. 1724/MDS/12 2 24.1.2012. ASSESSEE IS A TRUST CONSTITUTED BY A DE ED DATED 22.12.2011. CORPUS OF THE TRUST WAS ` 1000/-. AS PER THE CIT, THE MAIN OBJECTS OF THE TRUST WERE CONDUCTING MISSIONAR Y WORK, WORSHIP SERVICE, PRAYER MEETING, PROMOTING KNOWLEDGE OF CHR ISTIAN LOVE, ETC. ASSESSEE HAD OTHER OBJECTS ALSO, WHICH INTERALIA IN CLUDED SETTING UP OF PRINTING AND PUBLISHING OF BOOKS, ETC. CIT WAS OF THE OPINION THAT THE OBJECTS OF THE TRUST DEED PROVED THAT THE INTEN TION OF THE TRUST WAS TO ENGAGE ITSELF IN COMMERCIAL AND OTHER ACTIVI TIES. IN THIS VIEW OF THE MATTER, HE REFUSED TO GRANT THE REGISTRATION SO UGHT. 3. NOW BEFORE US, LEARNED A.R., STRONGLY ASSAILING THE ORDER OF CIT, SUBMITTED THAT ASSESSEE HAD PRODUCED THE ORIGI NAL TRUST DEED BEFORE THE CIT. IT HAD ALSO FURNISHED AUDIT REPORT IN FORM NO.10B ALONG WITH BALANCE SHEET AS ON 2.7.2012, AND INCOME & EXPENDITURE ACCOUNT FOR THE PERIOD FROM 22.12.2011 TO 2.7.2012. THESE CLEARLY SHOWED THAT IT HAD RECEIVED A DONATION OF ` 21,050/- AGAINST WHICH, ` 14,480/- WAS SPENT FOR CHARITY. THE CIT MIGHT HAVE CONSIDERED THE ASSESSEE TO BE A RELIGIOUS ORGANIZATION NOT DOING A NY CHARITY. EVEN IF ASSESSEE WAS CONSIDERED A RELIGIOUS TRUST, IT WAS O NLY DOING PUBLIC RELIGIOUS ACTIVITIES AND NOT ANY PRIVATE RELIGIOUS ACTIVITIES. LEARNED A.R. POINTED OUT THE OBJECTS OF THE TRUST AS PER TH E TRUST DEED, AND I.T.A. NO. 1724/MDS/12 3 SUBMITTED THAT THEY WERE EITHER PUBLIC CHARITABLE O R PUBLIC RELIGIOUS IN NATURE. 4. PER CONTRA, LEARNED D.R. STRONGLY SUPPORTED THE ORDER OF CIT. 5. WE HAVE PERUSED THE ORDER OF CIT AND HEARD THE COUNSELS. WHAT IS TO BE CONSIDERED AT THE STAGE WHEN AN ASSES SEE SEEKS A REGISTRATION UNDER SECTION 12AA OF THE ACT, IS CLEA RLY SPECIFIED IN SECTION 12AA OF THE ACT. CIT IS EMPOWERED TO CALL FOR DOCUMENTS OR INFORMATION WHICH HE THINKS NECESSARY TO SATISFY HI MSELF ABOUT GENUINENESS OF THE ACTIVITIES OF THE TRUST. CIT IS ALSO EMPOWERED TO MAKE INQUIRIES WHICH HE DEEMS NECESSARY FOR THIS PU RPOSE. CLAUSE (B) OF SUB-SECTION (1) TO SECTION 12AA MANDATES THA T ONCE CIT IS SATISFIED ABOUT OBJECTS OF THE TRUST AND GENUINENES S OF ITS ACTIVITIES, HE IS OBLIGED TO PASS AN ORDER IN WRITING REGISTERI NG THE TRUST. HERE, THE ONLY REASON GIVEN BY THE CIT FOR DENYING THE RE GISTRATION IS AS UNDER:- PERUSAL OF THE STATED OBJECTS IN THE TRUST DEED SHO WS THAT THE TRUST INTENDS TO ENGAGE ITSELF IN COMMERCIAL AND OT HER ACTIVITIES, WHICH ARE IN COMMERCIAL IN NATURE. THUS, THE REGIS TRATION SOUGHT U/S-12A OF THE ACT, IS REFUSED. THERE IS NO FINDING BY THE CIT THAT OBJECTS OF THE TRUST WERE NOT CHARITABLE OR RELIGIOUS, NOR ANY FINDING THAT THE A CTIVITIES WERE NOT I.T.A. NO. 1724/MDS/12 4 GENUINE. ASSESSEE HAD FURNISHED ITS INCOME & EXPEN DITURE ACCOUNT AND BALANCE SHEET, AND ALSO APPEARED BEFORE CIT WHE N CALLED UPON TO DO SO. IT HAD ALSO GIVEN A GIST OF ITS ACTIVITI ES. ITS OBJECTS WERE NOT HAVING ANY PRIVATE RELIGIOUS CHARACTER. WE ARE OF THE OPINION THAT ASSESSEE-TRUST DESERVES 12AA REGISTRATION AND THIS WAS UNJUSTLY DENIED BY THE CIT. WE, THEREFORE, QUASH THE ORDER OF CIT AND DIRECT HIM TO GRANT REGISTRATION SOUGHT UNDER SECTION 12AA OF THE ACT. 6. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS A LLOWED. THE ORDER WAS PRONOUNCED IN THE COURT ON TUESDAY, T HE 6 TH OF NOVEMBER, 2012, AT CHENNAI. SD/- SD/- (V.DURGA RAO) (ABRAHAM P. GEORGE) JUDICIAL MEMBER ACCOUNTANT MEMBER CHENNAI, DATED THE 6 TH NOVEMBER, 2012. KRI. COPY TO: (1) APPELLANT (2) RESPONDENT (3) CIT-I, COIMBATORE (4) D.R. (5) GUARD FILE