M/s. ADIWITYA RAYSA BAHUDESHI EVAM JAN KALYANKAR SANSTHA, Durg V. CIT, RAIPUR (CG)

ITA 258/BIL/2010

• Counselvise Citation: 25824714 RSA 2010
• Duration Of Justice: 1 year(s) 1 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-01-2012
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2006-2007
• Appeal Filed On: 14-12-2010
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: DARSHAN SINGH
• Assessee Lawyers: RAJESH KUMAR GUPTA
• Keywords: Charitable institution
• Section: 80G; 12A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, BILASPUR BENC H BILASPUR BEFORE SHRI SHAILENDRA KUMAR YADAV (J.M) & SHRI R.K.PANDA(A.M) ITA NO.258/BLPR/2010 ADIWITIYA RAYSA BAHUDESHI EVAM JAN KALYANKAR SANSTHA, DALLI RAJARA ROAD, BALOD, DURG (CG) PAN: (APPELLANT) VS. THE COMMISSIONER OF INCOME TAX, CENTRAL REVENUE BUILDING, CIVIL LINES, RAIPUR (CG) (RESPONDENT) APPELLANT BY : SHRI RAJESH KUMAR GUPTA RESPONDENT BY : SHRI DARSHAN SINGH, CIT DR DATE OF HEARING : 31/01 /2012 DATE OF PRONOUNCEMENT : 31/01 /2012 ORDER PER SHAILENDRA KUAMAR YADAV, J.M, THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAI NST THE ORDER OF CIT RAIPUR (CG) DATED 12/11/2010. THE GROUND OF AP PEAL RAISED BY THE ASSESSEE READS AS FOLLOWS: ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT HAS ERRED IN DISMISSING THE APPLICATION FOR APPROVAL U/S. 80 G(5) . 2. THE ASSESSEE SOCIETY HAS FILED ITS APPLICATION IN FORM NO.10G FOR APPROVAL UNDER SECTION 80G(5)(VI) OF THE INCOME TAX ACT, 1961 (THE ACT). THE SAME WAS RECEIVED IN THE OFFICE OF CIT ON 17/2/201 0. THE CIT OBSERVED THAT IN F.Y 2007-08 THE SOCIETY RECEIVED A CONTRACT REC EIPT OF RS. 20.00 LACS EACH. SO IT WAS FELT THAT UNDER THE AMENDED PROVISIONS O F SEC. 2(15) OF THE ACT THE ASSESSEES CLAIM FOR APPROVAL U/S. 80G OF THE ACT W AS DOUBTFUL AND THEREFORE, ITA NO.258/BLPR/2010 2 SHOW CAUSE NOTICE WAS ISSUED TO IT BY CIT. IN RESP ONSE TO THE SHOW CAUSE NOTICE THE LD. COUNSEL FOR THE ASSESSEE FILED A WR ITTEN SUBMISSION ON BEHALF OF THE ASSESSEE. AFTER THAT HAVING GONE THROUGH THE WRITTEN SUBMISSION THE CIT OBSERVED THAT THOUGH THE SOCIETY IS ENGAGED IN NUM BER OF CHARITABLE ACTIVITIES LIKE GENERAL PUBLIC UTILITY LIKE WATER CONSERVATIO N, DE-ADDICTION PROGRAMME, DISASTER MANAGEMENT PROGRAMME AND PLANT OF MEDICINA L PLANTS ETC. IN ADDITION TO IT THE SOCIETY HAS BEEN ENGAGED BY THE DISTRICT AUTHORITIES FOR SOME CIVIL WORKS UNDER MPLAD PROGRAMME. IT WAS OBSERVED BY CIT THAT THE PROJECT UNDER MPLAD ARE REQUIRED TO BE EXECUTED THROUGH NGO S ONLY BECAUSE SUCH WORKS CAN NOT BE GIVEN TO ANY CONTRACTOR OR MIDDL E-MAN. ON THIS GROUND THE SOCIETY HAS TAKEN UP A VIEW THAT IT SHOULD BE TREAT ED AS HAVING BEEN ENGAGED IN THE CHARITABLE WORK AND IN ADDITION TO REGISTRATIO N U/S. 12A OF THE ACT IT ALSO SHOULD BE APPROVED U/S. 80G OF THE ACT. THE CIT RE JECTED THE SUBMISSIONS PUT FORTH ON BEHALF OF THE ASSESSEE. 3. BEING AGGRIEVED BY THE ORDER OF THE CIT THE ASS ESSEE IN APPEAL BEFORE THE TRIBUNAL. IT WAS SUBMITTED THAT THE ASSESSEE B EING ENGAGED IN CHARITABLE ACTIVITIES SHOULD BE GRANTED APPROVAL U/S. 80G(5) O F THE ACT. ON THE OTHER HAND LD. D.R VEHEMENTLY SUPPORTED THE ORDER OF THE CIT AND SUBMITTED THAT 2 ND PROVISO TO SEC. 2(15) OF I.T. ACT HAS RIGHTLY BEE N INVOKED BY CIT WHILE REJECTING APPROVAL U/S. 80G OF THE ACT. 4. AFTER GOING THROUGH RIVAL SUBMISSIONS AND MATER IAL ON RECORD WE FIND THAT THE CHARITABLE PURPOSES HAS BEEN DEALT IN TH E PROVISIONS OF SAME SECTION ARESECTION 2(15) OF THE ACT. THE SAME PROVISION IS REPRODUCED AS UNDER: CHARITABLE PURPOSE INCLUDES RELIEF OF THE POOR, EDUCATION, MEDICINAL RELIEF, [PRESERVATION OF ENVIRONMENT (INCLUDING WAT ERSHEDS, FORESTS AND WILDLIFE) AND PRESERVATION OF MONUMENTS OR PLACES O R OBJECTS OF ARTISTIC OR HISTORIC INTEREST} AND THE ADVANCEMENT OF ANY OTHER OBJECT OF GENERAL PUBLIC UTILITY: PROVIDED THAT THE ADVANCEMENT OF ANY OTHER OBJECT O F GENERAL PUBLIC UTILITY SHALL NOT BE A CHARITABLE PURPOSE, IF IT IN VOLVES THE CARRYING ON OF ITA NO.258/BLPR/2010 3 ANY ACTIVITY IN THE NATURE OF TRADE, COMMERCE OR BU SINESS OR ANY ACTIVITY OF RENDERING ANY SERVICE IN RELATION TO ANY TRADE, COMMERCE OR BUSINESS, OR ANY TRADE , COMMERCE OR BUSINESS, FOR A CESS OR FEE OR ANY OTHER CONSIDERATION, IRRESPECTIVE OF THE NATURE OF USE OR APPLICATION, OR RETENTION, OF THE INCOME FROM SUCH ACTIVITY: [PROVIDED FURTHER THAT THE FIRST PROVISO SHALL NOT APPLY IF THE AGGREGATE VALUE OF THE RECEIPTS FROM THE ACTIVITIES REFERRED TO THEREIN IS TEN LAKH RUPEES OR LESS IN THE PREVIOUS YEAR. UNDISPUTEDLY, THE SOCIETY IS ENGAGED IN THE ADVANCE MENT OF OBJECTS OF GENERAL PUBLIC UTILITY. IT IS ALSO ENGAGED IN THE ACTIVITY OF THE NATURE OF BUSINESS FOR CONSIDERATION. AS PER SECOND PROVISO TO SECTION 2 (15) OF THE ACT IF SUCH ENTITYS GROSS RECEIPT DURING THE YEAR FROM BUSINESS, COMMER CE OR TRADE EXCEEDS RS. 10 LACS, ITS STATUS CAN NOT BE TAKEN AS CHARITABLE. I N VIEW OF THIS CIT WAS JUSTIFIED IN NOT ALLOWING APPLICATION FOR APPROVA L U/S.80G(5) OF THE ACT BECAUSE THE ASSESSEE WAS ENGAGED IN CIVIL CONSTRUCTION AND RECEIPT THERE FROM ARE OVER RS. 10.00 LACS IN RELEVANT YEAR. SO AS PER THE PROVISIONS OF 2 ND PROVISO TO SECTION 2(15) IT IS NOT TO BE TREATED AS A CHAR ITABLE ORGANIZATION, EVEN IF IT IS ENGAGED IN CIVIL CONTRACT UNDER MPLAD PROGRAMME. ACCORDINGLY THE ORDER OF CIT NEED NO INTERFERENCE HOW HAS REJECTED APPROVAL OF U/S. 80G(5) OF THE ACT TO THE ASSESSE AND WE UPHOLD THE SAME. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS DIS MISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THE 3 1 ST DAY OF JAN.2012. SD/- SD/- (R.K.PANDA) (SHAILENDRA KUMAR YADAV) ACCOUNTANT MEMBER JUDICIAL MEMBER BILASPUR, DATED. 31 ST JAN. 2012 ITA NO.258/BLPR/2010 4 COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3 . THE CIT CITY CONCERNED 4. THE CIT(A)- CONCERNED 5. THE D.R BILASPUR BENCH. (TRUE COPY) BY ORDER SR. PRIVATE SECR ETARY, ITAT, BILASPUR BENCH BILASPUR VM. ITA NO.258/BLPR/2010 5 DETAILS DATE INITIALS DESIGNATION 1 DRAFT DICTATED ON 31/1/2012 SR.PS/PS 2 DRAFT PLACED BEFORE AUTHOR 31/1/2012 SR.PS/PS 3 DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS SR.PS/PS 6. KEPT FOR PRONOUNCEMENT ON SR.PS/PS 7. FILE SENT TO THE BENCH CLERK SR.PS/PS 8 DATE ON WHICH THE FILE GOES TO THE HEAD CLERK 9 DATE OF DISPATCH OF ORDER