Jamiyah Hamidiyah Anjumane Himayatul Millat Trust, Bharuch V. The CIT.-III, Baroda

ITA 2145/AHD/2009

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 6313 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 11 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-06-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 20-06-2011
• Assessment Year: misc
• Appeal Filed On: 07-07-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ALBINUS TIRKEY
• Assessee Lawyers: S N DIVETIA
• Keywords: Charitable institution
• Section: 12A; 12AA; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AT AHMEDABAD, A BENCH (BEFORE S/SHRI G.D. AGARWAL, VICE-PRESIDENT AND BHAVNESH SAINI, JUDICIAL MEMBER) ITA NO.2145/AHD/2009 JAMIYA HAMIDIYA ANJUMANE HIMAYATUL MILLAT TRUST AT. PANOLI, TAL. ANKLESHWAR BHARUCH. VS. COMMISSIONER OF INCOME TAX-III BARODA. (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI S.N.DIVETIA REVENUE BY : SHRI ALBINUS TIRKEY O R D E R PER G.D. AGARWAL, VICE-PRESIDENT : THIS IS ASSESSEES APPEAL AGAINST THE ORDER OF LEARNED COMMISSIONER OF INCOME TAX III, BARODA DATED 19-5-2009. 2. THOUGH IN THE APPEAL, THE ASSESSEE HAS RAISED SE VERAL GROUNDS, HOWEVER, THEY ARE ALL AGAINST THE REJECTION OF THE REGISTRATION OF THE TRUST BY THE CIT-III, BARODA. 3. AT THE TIME OF HEARING BEFORE US, IT WAS STATED BY THE LEARNED COUNSEL THAT ORIGINALLY CIT-III HAD REFUSED REGIST RATION OF THE TRUST VIDE ORDER DATED 12-11-2007. THE ITAT VIDE ORDER IN ITA NO.235/AHD/2008 DATED 27-6-2008 SET ASIDE THE ORDER OF THE CIT AND DIRECTED HIM TO RE- ADJUDICATE THE MATTER AFTER ALLOWING THE OPPORTUNIT Y OF HEARING TO THE ASSESSEE-TRUST. THE CIT AGAIN VIDE HIS ORDER DATED 19-5-2009 REFUSED REGISTRATION OF THE TRUST. THAT THE MAIN REASON GI VEN BY THE CIT FOR REFUSING THE REGISTRATION OF THE TRUST IS THAT FROM VARIOUS OBJECTS OF THE TRUST DEED, IT IS CLEAR THAT THE ASSESSEE VIOLATES THE PROVISIONS OF SECTION 13(1)(B) OF THE ACT. IT IS STATED BY THE LEARNED COUNSEL THAT THE SECTION ITA NO.2145/AHD/2009 -2- 13(1)(B) OF THE ACT DEBARS EXEMPTION UNDER SECTION 11 WHERE ANY CHARITABLE TRUST IS CREATED OR ESTABLISHED FOR THE BENEFIT OF ANY PARTICULAR RELIGIOUS COMMUNITY OR CASTE. THAT THIS PROVISION WILL NOT BE APPLICABLE FOR ANY TRUST OR INSTITUTION WHICH IS RELIGIOUS-CUM -CHARITABLE TRUST. HE REFERRED TO VARIOUS OBJECTS OF THE TRUST AND POINTE D OUT THAT SOME OF THE OBJECTS OF THE TRUST ARE FOR THE PARTICULAR RELIGIO US COMMUNITY WHILE OTHER OBJECTS ARE FOR ALL COMMUNITY WITHOUT ANY DISCRIMIN ATION OF CASTE OR CREED. IN SUPPORT OF THIS CONTENTION, HE RELIED UP ON THE FOLLOWING DECISIONS: I) COMMISSIONER OF INCOME-TAX V. BARKATE SAIFIYAH SOCI ETY, 213 ITR 492 II) COMMISSIONER OF INCOME-TAX VS CHANDRA CHARITABLE TR UST (GUJ), 294 ITR 86 HE ALSO POINTED OUT THAT FOR THE PURPOSE OF REGISTR ATION OF THE TRUST UNDER SECTION 12A, THE LIMITED JURISDICTION OF THE COMMIS SIONER IS TO EXAMINE AND SATISFY HIMSELF ABOUT THE OBJECT OF THE TRUST A ND GENUINENESS OF ITS ACTIVITY. WHETHER THE TRUST WOULD BE ENTITLED TO E XEMPTION UNDER SECTION 11 IN EACH YEAR IS TO BE EXAMINED BY THE AO WHILE M AKING THE ASSESSMENT OF EACH YEAR. IF THE ASSESSEE VIOLATES PROVISION O F SECTION 13(1)(B) IN ANY PARTICULAR YEAR, THE AO IS ENTITLED TO REFUSE THE E XEMPTION UNDER SECTION FOR THAT YEAR. HOWEVER MERELY BECAUSE SOME OF THE OBJECTS OF THE TRUST ARE FOR THE BENEFIT OF ANY PARTICULAR RELIGIOUS COM MUNITY WOULD NOT BE A GROUND FOR REFUSAL OF THE REGISTRATION OF THE TRUST . HE THEREFORE SUBMITTED THAT THE CIT MAY BE DIRECTED TO REGISTER THE TRUST AS PER THE ASSESSEES APPLICATION. ITA NO.2145/AHD/2009 -3- THE LEARNED DR, ON THE OTHER HAND, RELIED UPON THE ORDERS OF THE CIT AND SUBMITTED THAT THE TRUST IS NOT ENTITLED FOR REGIST RATION UNDER SECTION 12A AND THEREFORE, THE CIT RIGHTLY REFUSED THE SAME. 4. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE M ATERIAL PLACED BEFORE US. WE FIND THAT THE HONBLE JURISDICTIONAL HIGH COURT HAS CONSIDERED THE APPLICABILITY OF SECTION 13(1)(B) OF THE ACT IN THE CASE OF BARKATE SAIFIYAH SOCIETY (SUPRA) WHEREIN THEIR LORD SHIP HELD AS UNDER: THAT THE TRIBUNAL HAD RIGHTLY HELD THAT SECTION 13 (1)(B) APPLIES ONLY TO TRUSTS WHICH WERE PURELY FOR CHARITABLE PUR POSES AND THE ASSESSEE-TRUST WAS CHARITABLE AS WELL AS RELIGI OUS IN NATURE AND THE ASSESSEE WAS ENTITLED TO EXEMPTION UNDER SE CTION 11 OF THE ACT. SIMILAR VIEW IS TAKEN BY THEIR LORDSHIPS IN THE CAS E OF CHANDRA CHARITABLE TRUST (SUPRA) WHEREIN THEIR LORDSHIPS H ELD AS UNDER: THAT IF JAINISM WAS ACCEPTED TO BE A RELIGION, FRO M THE COVENANTS OF THE TRUST DEED IT COULD BE SPELT OUT T HAT NOT ONLY TO PROPAGATE JAINISM OR HELP AND ASSIST MAINTENANCE OF THE TEMPLE, SADHUS, SADHVIS, ETC., YET OTHER GOALS WERE SET IN THE TRUST DEED. THE TRUST WOULD THEN BECOME A CHARITABL E TRUST AND ALSO A RELIGIOUS TRUST OR IT COULD BE ADDRESSED AS A CHARITABLE RELIGIOUS TRUST, AND IF THAT BE SO SECTION 13(1)(B) WOULD NOT BE APPLICABLE. FOR APPLYING THE RATIO OF THE ABOVE DECISIONS, WE H AVE GONE THROUGH THE OBJECTS OF THE TRUST DEED AND WE FIND THAT THOUGH S EVERAL OBJECTS ARE FOR THE BENEFIT OF PARTICULAR RELIGIOUS COMMUNITY, BUT THERE ARE VARIOUS OBJECTS ESPECIALLY OBJECTS NO.23 TO 33, WHICH ARE C HARITABLE IN NATURE AND WHICH ARE APPLICABLE TO PUBLIC AT LARGE WITHOUT ANY DISCRIMINATION OF CASTE. THEREFORE, WE HOLD THAT THE ASSESSEE-TRUST IS ALSO A CHARITABLE-CUM- RELIGIOUS TRUST TO WHICH SECTION 13(1)(B) WOULD NOT BE APPLICABLE. THE ITA NO.2145/AHD/2009 -4- CIT IN HIS ORDER UNDER SECTION 12AA HAS NOT POINTED ANY OTHER REASONS FOR REFUSING THE REGISTRATION OF THE ASSESSEE TRUST . IN VIEW OF THE ABOVE, WE RESPECTFULLY RELYING UPON THE ABOVE DECISION OF THE HONBLE JURISDICTIONAL HIGH COURT DIRECT THE CIT TO GRANT R EGISTRATION TO THE ASSESSEE-TRUST UNDER SECTION 12AA OF THE IT ACT. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED. ORDER PRONOUNCED IN OPEN COURT ON 24 TH JUNE, 2011 SD/- SD/- (BHAVNESH SAINI) JUDICIAL MEMBER (G.D. AGARWAL) VICE-PRESIDENT PLACE : AHMEDABAD DATE : 24-06-2011 C OPY OF THE ORDER FORWARDED TO: 1) : APPELLANT 2) : RESPONDENT 3) : CIT(A) 4) : CIT CONCERNED 5) : DR, ITAT. BY ORDER DR/AR, ITAT, AHMEDABAD