MUSLIM MAJLIS, MUMBAI V. DIT (E), MUMBAI

ITA 2045/MUM/2011

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 84132 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 8 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-11-2014
• Appeal Filed By: Assessee
• Bench Allotted: H
• Next Hearing Date: 14-10-2014
• Assessment Year: 2010-2011
• Appeal Filed On: 11-03-2011
• Court: TRIBUNAL
• Department Lawyers: K C PATNAI
• Assessee Lawyers: JAYANT S AJINKYA
• Keywords: Charitable institution; Opportunity of being heard; Additional evidence; Reasonable cause
• Section: 80G; 12A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL H BENCH, MUMBAI BEFORE SHRI VIJAY PAL RAO, JUDICIAL MEMBER AND SHRI D. KARUNAKARA RAO, ACCOUNTANT MEMBER ./I.T.A. NO. 2045/M/2011 MUSLIM MAJLIS, OPP. SANTACRUZ WEST POLICE STATION, JUHU ROAD, SANTACRUZ (W), MUMBAI 400054. / VS. DIT (E), MUMBAI. ./ PAN: AAATM 0820 C ( / APPELLANT) .. ( / RESPONDENT ) / APPELLANT BY : SHRI JAYANT S. AJINKYA / RESPONDENT BY : SHRI K.C. PATNAI, CIT - DR / DATE OF HEARING : 14.10.2014 / DATE OF PRONOUNCEMENT : 12 .11.2014 / O R D E R PER D. KARUNAKARA RAO, AM: THIS APPEAL FILED BY THE ASSESSEE ON 11.3.2011 IS AGAINST THE ORDER OF DIT (EXEMPTION), MUMBAI DATED 1.12.2010, WHO REJECTED THE APPLICATION MADE U/S 80G OF THE ACT. 2. AT THE OUTSET, LD COUNSEL FOR THE ASSESSEE MENTIONED THAT THE IS A DELAY OF 27 DAYS IN FILING THE APPEAL BEFORE THE TR IBUNAL. IN THIS REGARD, HE BROUGHT OUR ATTENTION TO THE AFFIDAVIT FILED BY MR. ASGHAR ALI PLASTERWALA, PRESIDENT OF MUSLIM MAJLIS, DATED 10.3.2011 AND READ OUT THE RELEVANT CONTENTS FROM THE SAID AFFIDAVIT WHICH READ AS UNDER: 1.. 2 3. THE APPEAL WAS TO BE FILED BY 10.2.2011. 4. THAT DEPONENT FELL ILL ON 21.11.2010 AND WAS UNDER THE TREATMENT OF DR. IQBAL SIDDIQUI , WHO ADVISED COMPLETE REST UP TO FIRST WEEK OF MARCH. 5. THAT THE DEPONENT FILED THE APPEAL ON 11.3.2011. 6. THAT IN THIS WAY, THERE IS A D ELAY OF ONLY 27 DAYS FOR WHICH AN APPLICATION UNDER SECTION 5 OF THE LIMITATION ACT HAS BEEN FILED ALONG WITH MEMORANDUM OF APPEAL. 2 3. FOR JUSTIFYING THE DELAY IN FILING THE APPEAL, ASSESSEE FILED A CONDONATION APPLICATION AND ENCLOSED THE CERTIFICATES AS EVIDENCES. CONSIDERING THE SAME, WE FIND, THERE IS A SUFFICIENT AND REASONABLE CAUSE FOR NOT FILING THE APPEAL WITHIN THE STIPULATED TIME BEFORE THE TRIBUNAL. THEREFORE, IN OUR OPINION, IT IS A FIT CASE FOR CONDONATION OF DELAY. ACCORDINGLY, WE CONDONE T HE DELAY AND PROCEED TO DECIDE THE APPEAL ON MERITS. 4 . BRIEFLY STATED RELEVANT FACTS ARE THAT THE ASSESSEE IS A TRUST DULY REGISTERED U/S 12A OF THE ACT. ACTING ON THE APPLICATION MADE BY THE ASSESSEE FOR APPROVAL U/S 80G OF THE ACT, DIT (E) EXAMINED THE OBJECTS OF THE TRUST AND ANALYZED THE PROVISIONS OF SECTION 80G(5) AND ISSUED SHOW CAUSE NOTICE DATED 8.3.2010. ON RECEIPT OF THE REPLY FROM THE ASSESSEE IN RESPECT OF THE SHOW CAUSE NOTICE, DIT CAME TO THE CONCLUSION THAT THE BENEFITS OF THE TRUST ARE RESTRICTED TO MUSLIM COMMUNITY. IN SUCH CIRCUMSTANCES, TRUST CANNOT BE CALLED A PUBLIC CHARITABLE TRUST. DIT RELIED ON CERTAIN DECISIONS AS MENTIONED IN PARA 8 OF THE IMPUGNED ORDER AND HELD THAT THE TR UST IS NOT ENTITLED FOR GRANT OF APPROVAL U/S 80G OF THE ACT. FURTHER, DIT EXAMINED THE PAPERS FILED BEFORE HIM AND NOTED THAT THE TRUST HAS NOT CARRIED OUT ANY CHARITABLE ACTIVITIES FOR THE LAST THREE YEARS AND NOT INCURRED ANY EXPENDITURE. THE DIT CAME TO THE CONCLUSION ON THE FACTS OF THE PRESENT CASE THAT GRANTING A CERTIFICATE U/S 80G WOULD NOT SERVE ANY PURPOSE TO THE APPLICANT. CONSIDERING THE FACTS AND CIRCUMSTANCES OF THE CASE, DIT HELD THAT THE ASSESSEE FAILED TO FULFILL THE MANDATORY PROVISION S LAID DOWN UNDER CLAUSE (II) & (III) TO SECTION 80G OF THE ACT. HE ACCORDINGLY REJECTED THE APPLICATION MADE IN THIS REGARD. AGGRIEVED WITH THE SAME, ASSESSEE FILED THE PRESENT APPEAL BEFORE US. 5. FOR JUSTIFYING THE DELAY IN FILING THE APPEAL, ASSESSEE F ILED A CONDONATION APPLICATION AND ENCLOSED THE CERTIFICATES AS EVIDENCES. CONSIDERING THE SAME, FIND IT IS A FIT CASE FOR CONDONATION OF DELAY. 6. BEFORE US, ASSESSEE FILED A LETTER DATED 15.7.2014 AND MENTIONED THAT THERE ARE SOME PAPERS PLACED AT PAG E 74 TO 84 OF THE PAPER BOOK WHICH CONSTITUTE ADDITIONAL EVIDENCES. THOUGH, THESE PAPERS WERE INITIALLY REQUESTED FOR EXCLUSION FROM CONSIDERATION BY US , DURING THE PROCEEDINGS BEFORE US, LD COUNSEL FOR THE ASSESSEE MENTIONED THAT THESE PAPERS SHALL DEMONSTRATE THAT THE TRUST IS PUBLIC IN 3 NATURE AND IT IS NOT EXCLUSIVELY FOR MUSLIM COMMUNITY. HE PRAYED FOR ADMITTING THE SAID ADDITIONAL EVIDENCES AND REMANDING THE ISSUES TO THE FILES OF THE DIT (E) FOR FRESH ADJUDICATION. LD COUNSEL FOR THE AS SESSEE ALSO MENTIO NED THAT THE D IT CONSIDERED ONLY 5 OBJECTS OF THE TRUST AND EXCLUDED THE OTHER OBJECTIONS MEN TIONED IN PARA 5 OF THE TRUST ANNEXURE I GIVING THE SCHEME OF THE TRUST. FURTHER, HE MENTIONED THAT THE DIT AS NOT GONE THOROUGHLY INTO THE FINANCIAL SERVICES OF THE TRUST FOR APPLYING THE PROVISIONS OF SECTION 80G(5)(B) ALONG WITH OTHER CLAUSES RELATES TO THE RELIGIOUS ACTIVITIES OF THE TRUST. 7. ON THE OTHER HAND, LD DR RELIED HEAVILY ON THE ORDER OF THE DIT (E) AND MENTIONED THAT THE ASSESSEE HAS FAILED TO DEMON STRATE THE PUBLIC NATURE OF THE TRUST AND THE EXPENDITURE INCURRED FOR ALL THE PUBLIC PURPOSES. 8. ON HEARING BOTH THE PARTIES, WE FIND THAT THE PAPERS PLACED IN THE PAPER BOOK AT PAGES 74 TO 82 ARE ADMITTEDLY THE FRESH EVIDENCES AND THEREFORE, IT IS IN TH E INTEREST OF THE JUSTICE THAT THE DOCUMENTS SHOULD BE REMANDED TO THE DIT (E) FOR FRESH CONSIDERATION. ASSESSEE IS ALSO DIRECTED TO FURNISH THE DETAILS OF EXPENDITURE AND INCOME TO DEMONSTRATE AS HOW THE EXPENDITURE IS INCURRED NOT ONLY FOR A PARTICULAR COMMUNITY AND FOR PUBLIC AT LARGE. DIT (E) SHALL GIVE A REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE IN THE REMANDING PROCEEDINGS. DIT (E) IS ALSO DIRECTED TO CONSIDER THE OBJECTIONS OF THE TRUST DURING THE REMANDING PROCEEDINGS. ACCORDINGLY, THE GROUND RAISED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. 9. IN THE RESULT APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOU NCED IN THE OPEN COURT ON 12 TH NOVEMBER, 2014. SD/ - SD/ - ( VIJAY PAL RAO ) (D. KARUNAKARA RAO ) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI ; 12 /11/2014 . . ./ OKK , SR. PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 4 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE . //TRUE COPY// / BY ORDER, / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI