M/s.Sadiya Educational and Charitable Trust, Shimoga V. Commissioner of Income Tax (Exemptions), Bangalore

ITA 2154/BANG/2016

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 7690 (ITAT-BANGALORE)
• Duration Of Justice: 8 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-08-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: misc
• Appeal Filed On: 09-12-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: V. SRINIVASAN
• Keywords: Charitable institution; Set aside
• Section: 11; 12AA; 13

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH : BANGALORE BEFORE SHRI A.K. GARODIA, ACCOUNTANT MEMBER AND SHRI LALIET KUMAR, JUDICIAL MEMBER ITA NO. 2154/BANG/2016 M/S. SADIYA EDUCATIONAL & CHARITABLE TRUST, SADIYA NAGAR, SHIRALKOPPA, SHIMOGA 577 428. PAN: AAKTS 8671H VS. THE COMMISSIONER OF INCOME TAX (EXEMPTIONS), BANGALORE. APPELLANT RESPONDENT APPELLANT BY : SHRI V. SRINIVASAN, ADVOCATE RESPONDENT BY : MS NEERA MALHOTRA, CIT(DR) DATE OF HEARING : 08.08.2017 DATE OF PRONOUNCEMENT : 18.08.2017 O R D E R PER SHRI A.K. GARODIA, ACCOUNTANT MEMBER THIS APPEAL IS FILED BY THE ASSESSEE WHICH IS DIRE CTED AGAINST THE ORDER OF LD. CIT(E), BANGALORE DATED 19.10.2016 U/S. 12AA OF THE IT ACT. 2. THE GROUNDS RAISED BY THE ASSESSEE ARE AS UNDER. 1. THE ORDERS OF THE AUTHORITIES BELOW IN SO FAR AS THEY ARE AGAINST THE APPELLANT ARE OPPOSED TO LAW, EQUITY, AND WEIGHT OF EVIDENCE, PROBABILITIES, FACT S AND CIRCUMSTANCES OF THE CASE. ITA NO. 2154/BANG/2016 PAGE 2 OF 6 2. THE LEARNED CIT [EXEMPTIONS] IS NOT JUSTIFIED IN GRANTING RECOGNITION U/S. 12AA OF THE ACT WHILE GIV ING EFFECT TO THE ORDERS OF THE HON'BLE ITAT UNDER THE LIMB OF 'AGPU', WHICH IS TOTALLY OPPOSED TO LAW AND FACT S OF THE APPELLANT'S CASE. 3. THE LEARNED CIT [EXEMPTIONS] OUGHT TO HAVE APPRECIATED THAT THE APPELLANT HAS OBJECTS OF MEDIC AL RELIEF, EDUCATION, RELIEF TO THE POOR AND OTHER OBJ ECTS OF GENERAL PUBLIC UTILITY AND HENCE, REGISTRATION OUGH T TO HAVE BEEN GRANTED WITHOUT ANY QUALIFICATIONS UNDER THE FACTS AND IN THE CIRCUMSTANCES OF THE APPELLANT 'S CASE. 4. FOR THE ABOVE AND OTHER GROUNDS THAT MAY BE URGED AT THE TIME OF HEARING OF THE APPEAL, YOUR APPELLANT HUMBLY PRAYS THAT THE APPEAL MAY BE ALLOWED AND JUSTICE RENDERED AND THE APPELLANT MAY BE AWARDED COSTS IN PROSECUTING THE APPEAL AND ALSO ORDER FOR THE REFUND OF THE INSTITUTION FEES AS PAR T OF THE COSTS. 3. IT WAS SUBMITTED BY THE LD. AR OF THE ASSESSEE THAT IN THE FIRST ROUND, THE MATTER WAS DECIDED BY THE TRIBUNAL IN ITA NOS. 422 AND 1632/BANG/2013 DATED 04.09.2015 AND COPY OF THIS TRIBUNAL ORDER IS AVAILABLE ON PAGES 10 TO 25 OF PAPER BOOK. HE POINTED OUT THAT AS PER THI S TRIBUNAL ORDER, THE TRIBUNAL HELD THAT THE REGISTRATION U/S. 12AA OF IT ACT SHOULD BE GRANTED TO THE ASSESSEE. IN PARTICULAR ATTENTION WAS DRAWN IN PARA 6.7 OF THE TRIBUNAL ORDER AVAILABLE ON PAGES 24 AND 25 OF THE PAPER BOOK. THEREAFTER, HE POINTED OUT THAT IN THE IMPUGNED ORD ER, REGISTRATION IS GRANTED BY THE LD. CIT(E) BUT WITH THIS QUALIFICATI ON THAT THIS REGISTRATION IS UNDER THE LIMB OF AGPU IN THE STATUS OF CHARIT ABLE TRUST. HE THEREAFTER POINTED OUT THAT ON PAGES 1 TO 9 OF PAPE R BOOK IS ANOTHER ITA NO. 2154/BANG/2016 PAGE 3 OF 6 TRIBUNAL ORDER RENDERED IN CASE OF M/S. RABIYA BASA RI RAHAMAT-ULLA-HI ALLAYHA CHARITABLE TRUST IN ITA NO. 2153/BANG/2016 DATED 05.07.2017 AND IN PARTICULAR, OUR ATTENTION WAS DRAWN TO PARA NO. 3.2 OF THIS TRIBUNAL ORDER AND IT WAS POINTED OUT THAT IN THAT CASE ALSO , THE REGISTRATION WAS GRANTED BY THE LD. CIT(E) WITH THE SAME QUALIFICATI ON THAT REGISTRATION IS GRANTED UNDER THE CATEGORY AGPU AND THE TRIBUNAL SET ASIDE THE SAID ORDER OF CIT(E) AND DIRECTED HIM TO PASS A FRESH OR DER OF REGISTRATION U/S. 12AA OF IT ACT WITHOUT ADDING HIS OWN QUALIFICATION THERETO SUCH AS AGPU ETC. HE SUBMITTED THAT IN THE PRESENT CASE ALSO, SIMILAR DIRECTION SHOULD BE GIVEN TO LD. CIT(E). THE LD. DR OF REVEN UE SUPPORTED THE ORDER OF CIT(E). 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. FIRST OF ALL WE REPRODUCE PARA NO. 6.7 FROM THE TRIBUNAL ORDER IN ASSESSEES OWN C ASE FOR FIRST ROUND FROM PAGES 24 AND 25 OF PAPER BOOK. THE SAME IS AS UNDER. 6.7 FROM A PERUSAL OF THE AFORESAID OBJECTS EXTRACTED BY US ABOVE, IT APPEARS TO US THAT THE OBJECTS OF THE ASSESSEE TRUST ARE CHARITABLE IN NATURE, COMING UNDER THE PROVISIONS OF SECTION 2(15) OF THE ACT. THE ONLY OBJECTION OF THE LD. CIT FOR GRANT OF REGISTRATION WAS THAT THE OBJECTS OF THE TRUST CONTAINED IN DEED DT. 4.6.2005 SHOWED THAT THE TRUST WAS SET UP FOR THE BENEFIT OF A PARTICULAR COMMUNITY. WHATEVER MAY BE THE CORRECTNESS OR OTHERWISE OF THE SAID FINDINGS OF THE LEARNED CIT, IT IS ONLY THE AMENDED OBJECTS THAT HAVE TO BE CONSIDERED FOR PURPOSE OF GRANT OF REGISTRATION. THUS, IN OUR VIEW, THE OBJECTIONS OF THE LD. CIT WITH REGARD TO THE PROVISIONS OF SECTION 13(1)(B) ITA NO. 2154/BANG/2016 PAGE 4 OF 6 OF THE ACT, ARE THEREFORE NO LONGER RELEVANT. IN THIS VIEW OF THE MATTER, THE CIT IS DIRECTED TO ACCORD THE ASSESSEE TRUST REGISTRATION UNDER SECTION 12AA OF THE ACT. IN ANY CASE, THE GRANT OF REGISTRATION IS ONLY A STEP IN THE PROCESS FOR CLAIM OF EXEMPTION UNDER SECTION 11 TO 13 OF THE ACT TO ENABLE THE ASSESSING OFFICER TO ENSURE THAT THE ASSESSEE COMPLIES WITH THE REQUIREMENTS CONTAINED THEREIN TO CLAIM EXEMPTION. 5. NOW WE REPRODUCE PARA NO. 3.2 OF THE TRIBUNAL ORDER RENDERED IN THE CASE OF M/S. RABIYA BASARI RAHAMAT-ULLA-HI ALLA YHA CHARITABLE TRUST(SUPRA) FROM PAGES 6 TO 8 OF THE PA PER BOOK. 3.2.1 WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE LD AR FOR THE ASSESSEE AND THE LD DR FOR REVENUE. ACCORD ING TO THE LD AR, THE LD CIT WAS NOT JUSTIFIED IN GRANTING THE ASSESSEE REGISTRATION U/S 12AA OF THE INCOME-TAX AC T, 1961 (IN SHORT THE ACT) UNDER THE LIMB AGPU WHEN THE OBJECTS OF THE ASSESSEE WERE MEDICAL RELIEF, EDUCATION, RELIEF TO THE POOR AND OTHER OBJECTS OF GENERAL PUBLIC UTILITY. IT IS CONTENDED THAT REGISTRATION OUGHT TO HAVE BEEN GRAN TED WITHOUT ANY QUALIFICATION AS HAS BEEN MADE OUT IN T HE IMPUGNED ORDER AND THAT IN DOING SO, THE LD CIT HAD FAILED TO COMPLY WITH AND CARRY OUT THE DIRECTIONS OF THE TRI BUNAL AS LAID OUT IN PARA 6.7 OF ITS ORDER IN ITA NO. 423 & 1631/BANG/2013 DATED 6/11/2015. 3.2.2 WE HAVE ALSO PERUSED THE RELEVANT PARAS 6.6 AND 6.7 OF THE TRIBUNAL ORDER IN ITA NO. 423 & 1631/BANG/20 13 DATED 6/11/2015 (EXTRACTED SUPRA AT PARA 2.1 OF THI S ORDER) AND FIND THAT THE TRIBUNAL HAD DIRECTED THE LD CIT TO GRANT THE ASSESSEE REGISTRATION U/S 12AA OF THE ACT. NOWHERE IN THE TRIBUNAL ORDER HAS THE LD CIT BEEN DIRECTED TO GRAN T THE ASSESSEE REGISTRATION U/S 12AA OF THE ACT IN THE CA TEGORY OF AGPU. IN THIS REGARD WE OBSERVED THAT THE LD CIT IN ORDER GIVING EFFECT TO ITATS ORDER GRANTED THE ASSESSEE TRUST REGISTRATION U/S 12AA OF THE ACT, QUALIFIED TO BE U NDER THE CATEGORY AGPU WHICH IN OUR VIEW IS NOT IN KEEPING WITH THE DIRECTION SET OUT IN THE TRIBUNALS ORDER (SUPRA). THIS OBSERVATION OF OUR WAS PUT TO THE LD DR DURING THE COURSE OF HEARING AND HE WAS UNABLE TO JUSTIFY THE LD CITS G RANTING OF SUCH QUALIFIED REGISTRATION U/S 12AA OF THE ACT WHI LE GIVING EFFECT TO THE TRIBUNALS ORDER WHICH CONTAINED NO S UCH DIRECTION. IN THE FACTS AND CIRCUMSTANCES OF THE M ATTER AS DISCUSSED ABOVE FROM PARA 2.1 TO PARA 3.2.2 OF THE ORDER, ITA NO. 2154/BANG/2016 PAGE 5 OF 6 WE ARE OF THE CONSIDERED VIEW THAT THE LD CIT IN HI S ORDER DATED 16/10/2016 HAS NOT GIVEN EFFECT TO THE ITAS ORDER DATED 6/11/2015 (SUPRA) AS DIRECTED THEREIN AND HAS EXCEEDED HIS BRIEF IN GRANTING THE ASSESSEE QUALIFI ED REGISTRATION U/S 12AA OF THE ACT. IN THIS VIEW OF THE MATTER, WE SET ASIDE THE IMPUGNED ORDER OF THE LD CIT AND D IRECT HIM TO PASS A FRESH ORDER GIVING EFFECT, GRANTING THE A SSESSEE REGISTRATION U/S 12AA OF THE ACT, AS DIRECTED IN TH E TRIBUNAL ORDER DATED 6/11/2015 (SUPRA) AT PARA 6.7 THEREOF W ITHOUT ADDING HIS OWN QUALIFICATION THERETO SUCH AS AGPU ETC. WE HOLD AND DIRECT ACCORDINGLY. CONSEQUENTLY, THE GRO UNDS NOS. 2 AND 3 RAISED BY ASSESSEE ARE ALLOWED. 6. SINCE THE FACTS IN THE PRESENT CASE AND IN THE CASE OF M/S. RABIYA BASARI RAHAMAT-ULLA-HI ALLAYHA CHARITABLE TRUST(SUP RA) ARE IDENTICAL, WE RESPECTFULLY FOLLOW THIS TRIBUNAL ORD ER AND DIRECT THE LD. CIT(E) TO PASS A FRESH ORDER FOR GRANTING THE R EGISTRATION U/S. 12AA OF IT ACT AS DIRECTED BY THE TRIBUNAL IN THE F IRST ROUND AS PER THE TRIBUNAL ORDER DATED 04.09.2015 IN ITA NOS. 422 AND 1632/BANG/2013 WITHOUT ADDING HIS OWN QUALIFICATION THERETO SUCH AS AGPU ETC. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWE D. 8. PRONOUNCED IN THE OPEN COURT ON THIS 18 TH DAY OF AUGUST, 2017. SD/- SD/- (LALIET KUMAR) (A.K. GARODIA) JUDICIAL MEMBER ACCOUNTANT MEMBER BANGALORE, DATED, THE 18 TH AUGUST, 2017. / MS/ ITA NO. 2154/BANG/2016 PAGE 6 OF 6 COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT, BANGALORE. 6. GUARD FILE BY ORDER SENIOR PRIVATE SECRETARY, INCOME TAX APPELLATE TRIBUNAL, BANGALORE.