International Pentecostal Church of God, CHENNAI V. ITO, Nagercoil

ITA 2935/CHNY/2014

• Counselvise Citation: 293521714 RSA 2014
• Duration Of Justice: 6 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-06-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 14-05-2015
• Assessment Year: misc
• Appeal Filed On: 04-12-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PATHLAVATH PEERYA
• Assessee Lawyers: A S SRIRAMAN
• Section: 80G; 12AA

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, CHENNAI . . . , . !' , $ % BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ./ ITA NO.2935/MDS/2014 ' (' / ASSESSMENT YEAR : N.A. M/S INTERNATIONAL PENTECOSTAL CHURCH OF GOD, 31-72Q, KAMALA HOUSE, NORTH STREET, NALLOOR VILLAGE, VILSVSNCOE TALUK, MARTHANDAM POST, KANYAKUMARI DISTRICT 629 165. PAN : AAATI 4631 B V. THE INCOME TAX OFFICER, WARD I(1), NAGERCOIL. (*+/ APPELLANT) (,-*+/ RESPONDENT) *+ . / / APPELLANT BY : SH. A.S. SRIRAMAN, ADVOCATE ,-*+ . / / RESPONDENT BY : SH. PATHLAVATH PEERYA, CIT 0 . 1$ / DATE OF HEARING : 14.05.2015 2!( . 1$ / DATE OF PRONOUNCEMENT : 12.06.2015 / O R D E R PER N.R.S. GANESAN, JUDICIAL MEMBER: THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST T HE ORDER OF THE COMMISSIONER OF INCOME TAX-I, MADURAI, DATED 23 .09.2014, REJECTING APPROVAL UNDER SECTION 80G OF THE INCOME- TAX ACT, 1961 (IN SHORT 'THE ACT'). 2 I.T.A. NO.2935/MDS/14 2. THERE WAS A DELAY OF 12 DAYS IN FILING THE APPE AL BY THE ASSESSEE. THE ASSESSEE HAS FILED A PETITION FOR CO NDONATION OF DELAY. WE HAVE HEARD THE LD. COUNSEL AND THE LD. D .R. WE FIND THAT THERE WAS SUFFICIENT CAUSE FOR NOT FILING THE APPEAL BEFORE THE STIPULATED TIME. THEREFORE, WE CONDONE THE DELAY A ND ADMIT THE APPEAL OF THE ASSESSEE. 3. SH. A.S. SRIRAMAN, THE LD.COUNSEL FOR THE ASSESS EE, SUBMITTED THAT THE ASSESSEE APPLIED FOR APPROVAL UN DER SECTION 80G OF THE ACT. ACCORDING TO THE LD. COUNSEL, THE ASSE SSEE-SOCIETY WAS REGISTERED UNDER SECTION 12AA OF THE ACT. THE ADMI NISTRATIVE COMMISSIONER BY AN ORDER DATED 23.09.2014 REJECTED THE APPLICATION OF THE ASSESSEE ON THE GROUND THAT ESTA BLISHMENT OF PUBLIC PLACES OF WORSHIP AND PRAYER HALLS ARE IN TH E NATURE OF RELIGIOUS PURPOSE. THEREFORE, SUCH AN OBJECT CANNO T BE ALLOWED UNDER SECTION 80G OF THE ACT. REFERRING TO SECTION 80(5) (I) OF THE ACT, THE LD.COUNSEL POINTED OUT THAT WHEN AN INSTIT UTION INCURS EXPENDITURE WHICH IS OF RELIGIOUS NATURE, FOR AN AM OUNT NOT EXCEEDING 5% OF THE TOTAL INCOME, IT SHALL BE DEEME D TO BE AN INSTITUTION OR FUND FOR WHICH THE PROVISIONS OF SEC TION 80G WOULD APPLY. ACCORDING TO THE LD. COUNSEL, THE COMMISSIO NER FAILED TO CONSIDER THESE PROVISIONS OF THE ACT. THE LD.COUNS EL FURTHER 3 I.T.A. NO.2935/MDS/14 SUBMITTED THAT THE ASSESSEE-SOCIETY NEVER APPLIED A NY MONEY OVER AND ABOVE 5% OF THE TOTAL INCOME, THEREFORE, THE AS SESSEE IS ENTITLED FOR APPROVAL UNDER SECTION 80G OF THE ACT. 4. ON THE CONTRARY, SH. PATHLAVATH PEERYA, THE LD. DEPARTMENTAL REPRESENTATIVE, SUBMITTED THAT ADMITTE DLY THE ASSESSEE IS A RELIGIOUS AND CHARITABLE ONE. ONE OF THE OBJECTS OF THE TRUST IS TO ESTABLISH PLACES OF WORSHIP AND PRA YER HALLS. ACCORDING TO THE LD. D.R., THE PRESENCE OF EVEN ONE RELIGIOUS OBJECT IN THE DEED WOULD DISENTITLE THE ASSESSEE FOR APPRO VAL UNDER SECTION 80G OF THE ACT. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITH ER SIDE AND PERUSED THE RELEVANT MATERIAL ON RECORD. SECTION 8 0G(I)(B) OF THE ACT READS AS FOLLOWS:- 80G(5B) NOTWITHSTANDING ANYTHING CONTAINED IN CLAUSE (II) OF SUB-SECTION (5) AND EXPLANATION 3, AN INSTITUTION OR FUND WHICH INCURS EXPENDITURE, DURING ANY PREVIOUS YEAR, WHICH IS OF A RELIGIOUS NATURE FOR AN AMOUNT NOT EXCEEDING FIVE PERCENT OF ITS TOTAL INCOME IN THAT PREVIOUS YEAR SHALL BE DEEMED TO BE AN INSTITUTION OR FUND TO WHICH THE PROVISIONS OF THIS SECTION APPLY. IN VIEW OF THE ABOVE PROVISION IN THE ACT, WHEN THE EXPENDITURE DOES NOT EXCEED 5% OF THE TOTAL INCOME FOR THE PREVIOUS YEAR, THEN SUCH A SOCIETY/INSTITUTION SHALL BE DEEMED TO BE AN INSTIT UTION TO WHICH THE 4 I.T.A. NO.2935/MDS/14 PROVISIONS OF SECTION 80G WOULD APPLY. THE COMMISS IONER HAS NOT EXAMINED THE EXPENDITURE INCURRED BY THE ASSESSEE I N THE PREVIOUS YEAR. EVEN THOUGH THE ASSESSEE CLAIMS THAT NO EXPE NDITURE WAS INCURRED EXCEEDING 5% OF THE TOTAL INCOME, THE COMM ISSIONER HAS NOT EXAMINED THE SAME. THEREFORE, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE COMMISSIONER HAS TO RE- EXAMINE THE MATTER AFRESH. ACCORDINGLY, WE SET ASIDE THE ORDER OF THE COMMISSIONER AND THE ENTIRE ISSUE IS REMITTED BACK TO HIS FILE. THE COMMISSIONER SHALL RE-EXAMINE THE ISSUE IN THE LIGH T OF THE PROVISIONS OF SECTION 80G(5B) AND THEREAFTER DECIDE THE SAME IN ACCORDANCE WITH LAW, AFTER GIVING REASONABLE OPPORT UNITY TO THE ASSESSEE. IT IS MADE CLEAR THAT IN CASE THE COMMIS SIONER DECIDES TO GRANT APPROVAL UNDER SECTION 80G OF THE ACT AND THE EXPENDITURE INCURRED BY THE ASSESSEE EXCEEDED 5% OF THE TOTAL I NCOME IN ANY OF THE PREVIOUS YEAR, THEN THE COMMISSIONER IS AT LIBE RTY TO WITHDRAW THE APPROVAL FOR THE YEAR IN WHICH THE EXPENDITURE EXCEEDED 5% OF THE TOTAL INCOME. 6. WITH THE ABOVE OBSERVATION, THE APPEAL OF THE AS SESSEE IS ALLOWED FOR STATISTICAL PURPOSES. 5 I.T.A. NO.2935/MDS/14 ORDER PRONOUNCED ON 12 TH JUNE, 2015 AT CHENNAI. SD/- SD/- (A. MOHAN ALANKAMONY) (N.R.S. GANESAN) (. !' ) ( . . . ) $ / ACCOUNTANT MEMBER /JUDICIAL MEMBER /CHENNAI, 4 /DATED, THE 12 TH JUNE, 2015. KRI. . ,156 76(1 /COPY TO: 1. *+ /APPELLANT 2. ,-*+ /RESPONDENT 3. 0 81 /CIT-I, MADURAI. 4. 69 ,1 /DR 5. :' ; /GF.