Shri Mataji Kankeshwari Temple Trust, JUNAGADH V. Pr. Commr. of Income Tax(OSD) (Exemptions), Ahmedabad

ITA 263/RJT/2015

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 9062 (ITAT-RAJKOT)
• Duration Of Justice: 1 year(s) 10 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-04-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 20-04-2017
• Assessment Year: misc
• Appeal Filed On: 08-06-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: MJ RANPURA
• Keywords: Gift; Charitable institution
• Section: 80G; 12AA; 12; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL RAJKOT BENCH, RAJKOT [CONDUCTED THROUGH E-COURT AT AH MEDABAD] BEFORE SHRI MAHAVIR PRASAD, JUDICIAL MEMBER AND SHRI, MANISH BORAD, ACCOUNTANT MEMBER ./ I.T.A. NO.263/RJT/2015 SHRI MATAJI KANKESHWARI TEMPLE TRUST KANKAI (GIR), VIA: VISAVADAR, POST-PREMPARA 362160, DIST: JUNAGADH / VS. PRINCIPAL COMMISSIONER OF INCOME TAX (OSD)(EXEMPTIONS), AHMEDABAD ./ ./ PAN/GIR NO. : AAATS 7916 D ( / APPELLANT ) .. ( / RESPONDENT ) / APPELLANT BY : SHRI M.J. RANPURA, AR / RESPONDENT BY : SHRI YOGESH PANDEY, CIT D.R. / DATE OF HEARING 20/04/2017 !'# / DATE OF PRONOUNCEMENT 24/04/2017 $% / O R D E R PER SHRI MAHAVIR PRASAD, JUDICIAL MEMBER : THIS APPEAL HAS BEEN PREFERRED BY THE ASSESSEE I S DIRECTED AGAINST THE ORDER OF THE PRINCIPAL COMMISSIONER OF INCOME TAX(OSD)(EXEMPTIONS)-AHMEDABAD, DATED 19/03/2015. 2. ASSESSEE HAS BEEN TAKEN FOLLOWING GROUNDS OF APP EALS: (I). THE LEARNED PRINCIPAL COMMISSIONER OF INCOME TAX (OSD) (EXEMPTION), AHMEDABAD [HEREINAFTER REFERRED TO AS THE 'PCIT'] HAS ERRED ON FACTS AND ALSO IN LAW IN REJECTING APP ELLANT'S ITA NO.263/RJT/ 2015 SHRI MATAJI KANKESHWARI TEMPLE TRUST VS. PCIT - 2 - APPLICATION U/S.80G(5) OF THE OF THE INCOME-TAX ACT , 1961 [HEREINAFTER REFERRED TO AS THE 'ACT'] BY ALLEGING THAT; THE OBJECTS OF THE TRUST ARE PURELY RELIGIOUS IN NA TURE. THE APPELLANT TRUST INCURRED EXPENDITURE ON RELIGIOUS PURPOSE MORE THAN PRESCRIBED LIMIT I.E. 5% WHICH IS IN VIOLATION OF PROVISION OF SECTION 80G(5B). THE APPELLANT TRUST HAS NOT PRODUCED THE COPY OF RE GISTRATION U/S.12AA OF THE ACT. (II). THE LEARNED PCIT WAS NOT JUSTIFIED IN LAW AND ON FACTS IN REJECTING APPELLANT'S APPLICATION FOR RECOGNITION U/S. 80G(5) ACT. THE LEARNED PCIT BE DIRECTED TO GRANT RECOGNITION U/S. 80G(5) OF THE ACT. (IV). THE ID. PCIT HAS FURTHER ERRED ON FACTS AND I N LAW IN IGNORING THE FACT THAT THE APPELLANT TRUST WAS GRANTED EXEMPTION U/S 80G(5) SINCE 92-93 AND ALSO HOLDING THAT THE ACTIVITIES OF THE TRUST WERE OF A RELIGIOUS NATURE. HE OUGHT TO HAVE APPRECIATED TH AT THE ACTIVITIES OF THE TRUST WERE CARRIED OUT IN ACCORDANCE WITH TH E OBJECTS OF THE TRUST AND WERE FOR THE BENEFIT OF GENERAL PUBLIC AN D ALL FACILITIES OF THE TRUST WERE MADE AVAILABLE TO GENERAL PUBLIC WIT HOUT DISTINGUISHING BETWEEN COMMUNITY, CASTE, CREED AND RELIGION. 3. ASSESSEE DELAY 13 DAYS OF APPEAL, SUPPORT OF THE SAME, APPELLANT FILED AN APPLICATION ALONGWITH AFFIDAVIT FOR CONDON ING THE DELAY. 4. THE APPELLANT, A CHARITABLE TRUST IS REGISTERED WITH THE ASSISTANT CHARITY COMMISSIONER, JUNAGADH VIDE REGISTRATION NO . A-938/JUNAGADH DATED 25/08/1965 AND FROM TIME TO TIME BOOKS OF ACC OUNTS OF THE TRUST ARE ALSO AUDITED. 5. THE APPLICATION FOR REGISTRATION OF THE TRUST U/ S. 80G(5) OF THE INCOME TAX ACT, 1961 WAS RECEIVED ON 17/09/2014 BY THE OFFICE OF THE LEARNED COMMISSIONER OF INCOME TAX-III, RAJKOT IN F ORM NO.10G UNDER ITA NO.263/RJT/ 2015 SHRI MATAJI KANKESHWARI TEMPLE TRUST VS. PCIT - 3 - RULE 11AA OF THE ACT. DUE TO RESTRUCTURING W.E.F 15 /11/2014, THE CASE HAS BEEN TRANSFERRED TO THE OFFICE OF THE PRINCIPAL COM MISSIONER OF INCOME TAX. THE LIST OF THE OBJECTS OF THE TRUST INCLUDES MANY ACTIVITIES. 6. A LETTER DATED 04/12/2014 WAS ISSUED TO THE APPL ICANT TO FURNISH DETAILED NOTE ON THE ACTIVITIES ACTUALLY CARRIED OU T BY THE TRUST AS WELL AS THE FOLLOWING DOCUMENTS/DETAILS: I. COPY OF BANK ACCOUNT SINCE INCEPTION OF TRUST OR LAST THREE YEARS. II. COPY OF ORDER U/S. 12AA OR COPY OF NOTIFICATION U/S. 10(23C) OR A/S. 35 OF THE IT, ACT. III. COPY OF AUDITED ACCOUNTS OF LAST THREE YEAR S OF TRUST WHO COMPLETED ONE OR MORE YEARS. IV. NOTES AND EVIDENCE ON GENUINENESS OF THE ACT IVITIES OF THE TRUST SINCE INCEPTION OF THE TRUST. V. WHETHER THE INCOME OF THE TRUST IS EXEMPT U/S. 11 & 12 OR 10(23C) OR 35 OF THE ACT. VI. WHETHER THE TRUST IS EXPRESSED FOR THE BENEFIT OF ANY PARTICULA R RELIGION, COMMUNITY OR OTHERS? VII. WHETHER ANY BUSINESS IS CARRIED ON BY TRUST FO R WHICH SEPARATE BOOKS OF ACCOUNTS ARE MAINTAINED? VIII. WHETHER ANY OBJECT OF THE CLAUSE OF DEED IS S UCH THAT IT IS AGAINST SOCIAL CAUSE. IX. WHETHER THE EXPENDITURE ON RELIGIOUS PURPOSE IS WITH A 5% OR NOT? GIVE FIGURES AND CALCULATION. X. COPY OF CERTIFICATE OF UNDERTAKING? XI. COPY OF CERTIFICATE U/S. 13(1) (C) OF THE I.T. ACT? XII. DECLARATION U/S. 11(5) OF THE I.T. ACT? XIII. DETAILS OF DONATIONS RECEIVED OR PAID AND CON FIRMATION/PAN OF THE DONORS, XIV. FURTHER, IT IS SEEN THAT AS PER TRUST DEED THE DISSOLUTION CLAUSE IS NOT PROPER /NOT THERE . 7. IN RESPONSE TO THE AFORESAID LETTER, THE APPLICA TION TRUST APPEARS ON 07/01/2015. ON THE PERUSAL OF THE DETAILS/DOCUMENTS SUBMITTED BY THE ITA NO.263/RJT/ 2015 SHRI MATAJI KANKESHWARI TEMPLE TRUST VS. PCIT - 4 - APPLICANT TRUST, IT IS FOUND THAT OBJECTS OF THE TR UST ARE PURELY RELIGIOUS IN NATURE. SOME OBJECTS OF THE TRUST ARE AS UNDER: TO DO AND SUPERVISE THE WORSHIP OF THE GODESS KANK ESHWARI BY THE PUJARI OF THE TEMPLE AND CELEBRATION OF OTHER F ESTIVALS AND CEREMONIES OF THE TEMPLE INCLUDING THE HAVANS AND Y AGNAS AND TO PROVIDE ARTICLES FOR WORSHIP. TO PROVIDE ACCOMMODATION FOR PERSONS USING THE SANA TORIUM AND ALLOT ROOMS TO THE BENEFICIARIES, DEVOTEES OF GODES S KANKESHWARI, PILGRIMS AND SANT, SADHU. TO APPOINT PUJARIS AND OTHER STAFF TO ASSIST PUJARI ON SALARY BASIS AND TO EVOLVE CODE OF CONDUCT IN RESPECT OF THEIR S ERVICE. TO APPOINT REQUIRED STAFF TO LOOK AFTER AND MANAGE THE TEMPLE AND TRUST PROPERTIES AND THE ACCOUNT OF THE TRUST. 8. ON VERIFICATION OF AUDIT REPORT SUBMITTED BY THE TRUST FOR F.Y. 2011-12, 2012-13 & 2013-14 IT IS SEEN THAT THE TRUS T INCURRED EXPENDITURE ON RELIGIOUS PURPOSES MORE THAN 5% WHICH IS NOT TEN ABLE. THE DETAILS OF WHICH ARE AS UNDER: F.Y. TOTAL INCOME TOTAL EXPENDITURE ON RELIGIOUS PURPOSES % INCURRED ON RELIGIOUS PURPOSES. 2011-12 56,78,705/- 15,84,131/- 27.90% 2012-13 53,96,165/- 12,61,617/- 23.38% 2013-14 42,41,332/- 7,98,375/- 18.82% 9. FROM THE ABOVE TABLE IT IS CLEAR THAT THE APPELL ANT TRUST INCURRED EXPENDITURE ON RELIGIOUS PURPOSES MORE THAN 5%. UND ER THE CONTEXT, THE LEARNED PRINCIPAL COMMISSIONER OF INCOME TAX ISSUED A SHOW CAUSE VIDE ORDER SHEET NOTING DATED 07/01/2015 AND REQUESTED T O GIVE ITS EXPLANATION AS TO WHY THE APPLICATION FILED IN FORM NO. 10G FOR APPROVAL U/S. 80G(5) OF THE ACT SHOULD NOT BE REJECTED AS THE OBJECTS OF THE TRUST IS RELIGIOUS. ITA NO.263/RJT/ 2015 SHRI MATAJI KANKESHWARI TEMPLE TRUST VS. PCIT - 5 - 10. IN RESPONSE TO THE SHOW CAUSE ISSUED, THE APPLI CANT TRUST SUBMITTED THE INTER ALIA WHICH IS AS UNDER: THE OBJECTS OF THE TRUST ARE MIXED OBJECTS, I.E. C HARITABLE AND RELIGIOUS OBJECTS. THE ACTIVITIES OF THE TRUST IS CHARITABLE ALSO AND NOT ONLY RELIGIOUS. 11. BUT SOME WAS NOT TENABLE IN THE EYES OF THE LEA RNED PCIT. THEREFORE, APPLICATION FILED IN FORM NO.10G FOR APP ROVAL U/S. 80G(5) OF THE INCOME TAX ACT WAS REJECTED BY THE LEARNED PRIN CIPAL COMMISSIONER OF INCOME TAX(OSD)(EXEMPTIONS), AHMEDABAD. 12. AGAINST THE SAID ORDER TRUST PREFERRED AN APPEA L BEFORE ITAT. 13. WE HAVE GONE THROUGH THE RELEVANT RECORD AND IM PUGNED ORDER, WHEREAS LEARNED DR RELIED UPON THE ORDER OF THE OCI T AND FILED HIS OBJECTION AND STATING THAT IT WAS HELD IN THIS DECI SION THAT BY VIRTUE OF THE NON-OBSTINATE SECTION 80G(5B), EVEN IF A RELIGIOUS TRUST INCURS EXPENDITURE DURING ANY PREVIOUS YEAR OF RELIGIOUS N ATURE FOR AN AMOUNT NOT EXCEEDING 5% OF ITS TOTAL INCOME IN THAT PREVIO US YEAR, IT IS DEEMED AS AN INSTITUTION OR FUND TO WHICH PROVISION OF SECTIO N 80G APPLIES. 14. IT WAS FURTHER STATED THAT IN THE TOTAL EXPENDI TURE ON RELIGIOUS PURPOSES EXCEEDS 5% AS MENTIONED IN PARA 4.1 OF THE ORDER OF CIT. ITA NO.263/RJT/ 2015 SHRI MATAJI KANKESHWARI TEMPLE TRUST VS. PCIT - 6 - THEREFORE, THE ASSESSEE TRUST IS NOT ELIGIBLE FOR T HE DEDUCTION U/S.80G(5) AS THE PROVISIONS OF SECTION 80G(5B) APPLIES. 15. ON THE OTHER HAND, LEARNED AR CITED A JUDGMENT OF SUPREME COURT IN THE MATTER OF COMMISSIONER OF INCOME TAX, UJJAIN VS. DAWOODI BOHARA JAMAT [2014] 43 TAXMANN.COM 243 (SC): IT IS HELD THAT SECTION 13, READ WITH SECTION 12AA AND 11, OF THE INCOME- TAX ACT, 1961 CHARITABLE OR RELIGIOUS TRUST DEN IAL OF EXEMPTION (SUB- SECTION (1)(B)) WHETHER WHERE ASSESSEE TRUST IS F ORMED WITH BOTH RELIGIOUS AND CHARITABLE OBJECTS, IN TERMS OF SECTION 13(1)(B ), ITS CLAIM FOR REGISTRATION UNDER SECTION 12AA CAN BE DENIED ONLY IN A CASE WHE N SUCH OBJECTS ARE CARRIED OUT FOR BENEFIT OF A PARTICULAR RELIGIOUS COMMUNITY OR CASTE. 16. IN THIS CASE, MATTER WAS DECIDED IN FAVOUR OF T HE ASSESSEE. 17. LEARNED AR STATED THAT TRUST IS INVOLVED IN THE RELIGIOUS AS WELL AS CHARITABLE ACTIVITIES. 18. FURTHER, LEARNED AR CITED A JUDGMENT IN OUR OWN BENCH IN THE MATTER OF SHRI YAMUNAJI MANDIR TURST VS. CIT IN ITA NO.330/RJT/2015 IN SIMILAR MATTER CO-ORDINATING BENCH ALLOWED THE APPE AL OF THE ASSESSEE AND GRANTED REGISTRATION UNDER SECTION 80G(5). IN T HE MATTER OF CIT VS K.H. KASUMGAR [1987] 63 CTR 70 (BOMBAY): SECTION 5(1)(V), READ WITH SECTION 5(1A), OF THE GI FT-TAX ACT, 1958 - EXEMPTION - GIFT TO CHARITABLE INSTITUTION - WHETHE R GILT MADE BY ASSESSES OF IMMOVABLE PROPERTIES TO A PUBLIC CHARIT ABLE TRUST, OBJECT OF WHICH WAS IMPARTING OF EDUCATION, ENCOURAGEMENT AND PROMOTION OF STUDY AND PRACTICE OF SHWEETAMBER JAIN RELIGION AMO NGST STUDENTS OF ASHRAM, ETC., WITHOUT DISTINCTION OF SEX, CASTE, PL ACE OR RELIGION, WAS EXEMPT UNDER SECTION 5(1)(V)- HELD, YES. ITA NO.263/RJT/ 2015 SHRI MATAJI KANKESHWARI TEMPLE TRUST VS. PCIT - 7 - 19. RESPECTFULLY, FOLLOWING THE AFORESAID JUDGMENT, WE ALLOW THE APPEAL OF THE ASSESSEE AND SET ASIDE THE ORDER OF T HE PRINCIPAL CIT AND ALLOW THE APPEAL OF THE ASSESSEE FOR STATISTICAL PU RPOSE. 20. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSE. THIS ORDER PRONOUNCED IN OPEN COURT ON 24 / 04 /201 7 SD/- SD/- (MANISH BORAD) (MAHAVIR PRASAD) ACCOUNTANT MEMBER JUDICIA L MEMBER AHMEDABAD; DATED 24/04/2017 PRITI YDAV, SR. PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. & '( ) / CONCERNED CIT 4. ) () / THE PCIT(A)- AHMEDABAD. 5. ,-. //'( , '(# , 12$&$ / DR, ITAT, AHMEDABAD 6. .34 5 / GUARD FILE. / BY ORDER, , / //TRUE COPY// / ( DY./ASSTT.REGISTRAR) !' #, / ITAT, AHMEDABAD TRUE COPY