Radiant Educational and Charitable Trust, CHENNAI V. CIT, Trichy

ITA 2693/CHNY/2014

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 96667 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 2 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-12-2015
• Appeal Filed By: Assessee
• Bench Allotted: A
• Next Hearing Date: 05-11-2015
• Assessment Year: 2013-2014
• Appeal Filed On: 27-10-2014
• Court: TRIBUNAL
• Assessee Lawyers: K SOUNDARARAJAN SHRI V
• Keywords: Gift; Charitable institution
• Section: 12AA

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, CHENNAI , . ! ' , # '$ BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SHRI G. PAVAN KUMAR, JUDICIAL MEMBER . /ITA NOS. 2692 & 2693/MDS/2014 M/S. RADIANT EDUCATIONAL AND CHARITABLE TRUST, REP. BY ITS MANAGING TRUSTEE MR. A.ALBERT, PLOT NOS. 1,2,3, G.K.S. NAGAR, 7 TH CROSS, BANK STAFF COLONY, MADHAKOTTAI ROAD, THANJAVUR 613005. PAN AABTR1827P ( /APPELLANT) V. THE COMMISSIONER OF INCOME- TAX (II), NO.44, WILLIAMS ROAD, CANTONMENT, TIRUCHIRAPALLI 620 001. RESPONDENT) / APPELLANT BY : SHRI K. SOUNDARARAJAN, ADVOCATE / RESPONDENT BY : SHRI V. VIVEKANANDAN, CIT / DATE OF HEARING : 05.11.2015 / DATE OF PRONOUNCEMENT : 31.12.2015 % / O R D E R PER CHANDRA POOJARI, ACCOUNTANT MEMBER THESE APPEALS BY THE ASSESSEE ARE DIRECTED AGAIN ST THE ORDER OF THE COMMISSIONER OF INCOME-TAX WITH REGARD TO NON- - - ITA 2692 & 2693/14 2 GRANTING OF REGISTRATION UNDER SEC.12AA AND ALSO AP PROVAL U/S.80G OF THE I.T.ACT. 2. THE ASSESSEE TRUST WAS REGISTERED ITS DEED ON 6. 3.2006 AS DOCUMENT/SL. NO.273/2006 WITH THE JOINT SUB-REGI STRAR-I, THANJAVUR AND FURTHER EXTENDED ON 10.1.2007, 18.7.2 007, 21.8.2012, 24.9.2012, 5.11.2012 & 18.8.2014. THE A SSESSEE APPLIED FOR REGISTRATION U/S.12AA AND ALSO APPROVAL U/S.80G OF THE ACT ON 24.2.2014 AND BOTH, REGISTRATION AND APP ROVAL WAS REJECTED BY THE C.I.T. ON THE REASON THAT THE TRUST EES BROUGHT HUGE AMOUNTS AS LOANS AND DEVELOPMENT FUNDS FOR WHI CH THE SOURCES HAVE NOT BEEN EXPLAINED. IT IS ALSO NOTICE D BY THE CIT THAT SOME OF TRUSTEES HAVE RETIRED AND NEW TRUSTEES HAVE BEEN ADMITTED. ACCORDING TO THE CIT, NOBODY WILL RETIRE WITHOUT TAKING ANY BENEFIT AND HOW MUCH MONEY WAS TAKEN BY THEM WA S NOT KNOWN AND THIS SHOWS THAT IT IS NOTHING BUT SETTLIN G OF ONE TRUST TO ANOTHER TRUST. THE ASSESSEE IS CARRIED ON ITS ACTI VITIES IN A COMMERCIAL MANNER AND IT IS NOT INVOLVED IN CHARITA BLE ACTIVITIES. ACCORDINGLY, THE CIT HAS REFUSED TO GRANT REGISTRAT ION U/S.12AA AND APPROVAL U/S.80G OF THE ACT. AGAINST THIS, TH E ASSESSEE IS IN APPEAL BEFORE US. - - ITA 2692 & 2693/14 3 3. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE M ATERIAL ON RECORD. WHENEVER THE ASSESSEE APPLY FOR REGISTR ATION U/S.12AA OF THE ACT, THE CIT HAS TO SATISFY HIMSELF ABOUT THE OBJECTS OF THE TRUST AND GENUINENESS OF THE ACTIVIT IES BY CALLING THE DOCUMENTS OR INFORMATION FROM THE TRUST. IN TH E PRESENT CASE, THE TRUST DEED WAS AMENDED ON 10 TH DAY OF JANUARY, 2007 AND THE OBJECTS OF THE ASSESSEE-TRUST ARE AS UNDER: 4.1 TO ESTABLISH, PROMOTE, SET-UP, RUN, MAINTAIN , ASSIST, FINANCE, SUPPORT AND/OR AID TO OR HELP IN THE SETTI NG UP AND/OR MAINTAINING AND/OR RUNNING GURUKULAS, BALAVI KAS CENTRES, SCHOOLS, WORKSHOPS AND OTHER INSTITUTIONS, RESIDENTIAL OR OTHERWISE, FOR IMPARTING GENERAL, TE CHNICAL, PROFESSIONAL, INDUSTRIAL AND OTHER KINDS OF EDUCATI ONS AND TRAINING FOR THE WELFARE OF GENERAL PUBLIC AND MAINTENANCE OF HOSTELS AS ADJUNCTS THERETO. 4.2 TO GIVE, PROVIDE AND/OR RENDER HELP AND ASSISTANCE IN CASH OR KIND TO POOR AND/OR DESTITUTE PEOPLE WIDOWS, ETC. 4.3 TO GIVE, PROVIDE AND/OR RENDER MONETARY AND/OR OTHER HELP AND ASSISTANCE FOR THE RELIEF OF PERSONS AND ANIMALS AFFECTED BY NATURAL AND OTHER CALAMITIES SU CH AS FOLD, FIRE, FAMINE, CYCLONE, EARTHQUAKE, STORM ACCI DENT, PESTILENCE, DROUGHT, EPIDEMIC, UNBEARABLE COST OF L IVING AND THE LIKE, TO GIVE DONATIONS, SUBSCRIPTIONS OR CONTRIBUTIONS TO INSTITUTIONS, ESTABLISHMENTS, CENT RES OR PERSONS DOING RELIEF WORK ON SUCH OCCASIONS. 4.4. TO START, MAINTAIN AND ASSIST ANY RELIEF MEASU RES IN THOSE PARTS WHICH ARE OR BECOME SUBJECTED TO NAT URAL CALAMITIES SUCH AS FLOOD, FIRE, DROUGHT, FAMINE CYC LONE, EARTH-QUAKE, EPIDEMIC, STORM, ACCIDENT, PESTILENCE, ETC. - - ITA 2692 & 2693/14 4 4.5 TO PROVIDE LEGAL COUNSELING CENTRES TO ENABLE THE OPPRESSED AND THE EXPLOITED SECTIONS OF THE SOC IETY TO GEDT THEIR GRIEVANCES REDRESSED AND THEIR RIGHTS RESTORED. 4.6. TO OPEN STUDENTS DEVELOPMENT CENTRES TO PROVIDE BEST ACADEMIC COACHING IN ALL ARTS AND SCIE NCES AND TO OPEN VOCATIONAL TRAINING CENTRES. 4.7 TO PROVIDE EDUCATIONAL GUIDANCE AND COUNSELING SO AS TO ENABLE THE PARENTS, TEACHERS, STUDDNTS AND SCHOOLS TO WORK FOR A NEW SYSTEM OF EDUCATION FOR S OCIAL CHANGE, PEACE, HARMONY AND NATIONAL INTEGRATION. 4.8 TO ORGANIZE WOMENS WELFARE CENTRES TO PROVIDED THEM WITH EDUCATION AND TRAINING IN ALL FI ELDS IRRESPECTIVE OF AGE, CASTE, CREED OR SOCIAL STATUS. 4.9 TO PUBLISH PERIODICALS, PAMPHLETS, BOOKS, EDUCATIONAL AIDS INCLUDING AUDIO-VISUAL AIDS, FOR T HE BENEFIT OF THE STUDENTS AS WELL AS THE SOCIETY. 4.10 TO GET AIDS FROM GOVERNMENT, CHARITABLE INSTITUTIONS, ASSOCIATIONS, DONOR AGENCIES FROM ABR OAD ETC. AND UTILIZE THEM FOR THE WELFARE OF THE POOR. 4.11 TO PROMOTE, ADVANCE AND ENCOURAGE AND/OR AID IN HELPING, PROMOTING, ADVANCING AND ENCOURAGING PRIMARY, SECONDARY AND HIGHER EDUCATION INCLUDING TECHNICAL AND MEDICAL EDUCATION ALSO PHYSICAL TRAIN ING, TRAINING OF HANDICRAFTS FINE ART AND OTHER USEFUL A RTS, CRAFTS AMONG THE PUBLIC INCLUDING THE ESTABLISHMENT AND MAINTENANCE OF SHILP-SHIKSHALAYAS, KALA-KENDRAS AND OTHER WELFARE CENTRES FOR THEM. 4.12 TO PROMOTE, ASSIST AND/OR MAINTAIN ALL ACTIVIT IES BY WHOSOEVER CARRIED ON OR WHEREVER CARRIED ON IN I NDIA IN CONFORMITY WITH THE OBJECTS OF THE TRUST AND AS ARE CONDUCIVE TO THE WELL BEING AND GENERAL WELFARE OF THE - - ITA 2692 & 2693/14 5 NATION OR ARE CONDUCIVE FOR ADVANCEMENT OF ANY OBJE CT OR OBJECTS OF GENERAL PUBLIC UTILITY NOT INVOLING/CARR YING ON ANY ACTIVITY FOR PROFIT. 4.13 TO PUBLISH AND OR PUBLISHING BOOKS, PAMPHLETS, PERIODICALS AND NEWSPAPERS IN INDIA OR OUTSIDE FOR THE SPREAD AND ADVANCEMENT OF EDUCATION AND CULTURE. 4.14 TO FOSTER AND ENCOURAGE EDUCATION AND TRAINING IN HANDICRAFTS, FIND ARTS, AMONG WOMEN FOLK IN GENE RAL AND ESTABLISH AND FOUND INSTITUTIONS IMPARTING SUCH EDUCATION AND TO ESTABLISH, MAINTAIN, SUPPORT OR HE LP BY MONETARY GIFTS, OR OTHERWISE, CENTRES AND INSTITUTI ONS FOR WOMEN AND CHILDREN AND TO PROVIDE SOCIAL WELFARE WO RKS FOR WOMEN AND CHILDREN. 4. AS PER THE REQUIREMENT OF SEC. 12AA, THE OBJECT CLAUSE SHOULD NOT CONTAIN ANY NON-CHARITABLE ACTIVITIES AND IT IS NOTED THAT ALONG WITH CHARITABLE ACTIVITIES, THE ASSESSEE CAN CARRY RELIG IOUS ACTIVITIES ALSO. FURTHER, THE OBJECTS OF THE ASSESSEE CANNOT BE SAID DESCRIPTIVE AND THE OBJECTS MENTIONED IN THE TRUST DEED ARE IN ACCO RDANCE WITH THE PROVISIONS OF SECTION 2(15) OF THE ACT AND THERE IS NO ALLEGATION BY THE CIT THAT THE OBJECTS MENTIONED THEREIN ARE NOT CHAR ITABLE IN NATURE AND CANNOT BE SAID THAT THE OBJECTS STATED ABOVE AR E NOT CONSIDERED AS NON-CHARITABLE. BEING SO, IN OUR OPINION, THE REASONS ADVANCED BY THE CIT FOR REJECTING THE REGISTRATION U/S. 12AA OF THE ACT AND APPROVAL U/S.80G ARE NOT PROPER. JUST BECAUSE THE ASSESSE IS HAVING SURPLUS INCOME, THE ASSESSE CANNOT BE DENIED REGIST RATION U/S.12AA - - ITA 2692 & 2693/14 6 AND APPROVAL U/S.80G OF THE ACT. IN VIEW OF THIS, WE DIRECT THE CIT TO CONSIDER THE APPLICATION FOR REGISTRATION U/S.12AA AS WELL AS APPROVAL U/S.80G AND IF IT IS NECESSARY, HE CAN SUGGEST NECE SSARY AMENDMENT TO THE TRUST DEED AND RECEIPT OF THE SAME, HE SHOUL D PASS A SPEAKING ORDER ON THE ISSUES AFTER GIVING OPPORTUNITY OF BEI NG HEARD. 5. IN THE RESULT, THE APPEALS OF THE ASSESSE ARE AL LOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON THURSDAY, THE 31 ST OF DEC., 2015 AT CHENNAI. SD/- SD/- ( !' # ) ( $ % & ! ) ''()*)+,-.)/012)+3/)(445)/60 7 89: /JUDICIAL MEMBER 9:;<<4-+=)+=>?.@?/ $7 /CHENNAI, A9 /DATED, THE 31 ST DEC., 2015. MPO* 9B8CDED /COPY TO: 1. /APPELLANT 2. /RESPONDENT 3. F0 /CIT(A) 4. F /CIT 5. DG H88IJ /DR 6. H KLM /GF.