Progressive Rural Educational Movements, Dumka V. CIT, Dhanbad

ITA 3/RAN/2013

• Counselvise Citation: 325114 RSA 2013
• Duration Of Justice: 3 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-05-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: misc
• Appeal Filed On: 01-02-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: HARSHWARDHAN PRASAD SR S C
• Assessee Lawyers: M K CHOUDHURY
• Keywords: Charitable institution
• Section: 12AA; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, RANCHI CIRCUI T BENCH, RANCHI (BEFORE SHRI P.K.BANSAL, HONBLE A.M.& SHRI D,T. GA RASIA, HONBLE J.M .) I.T.A. NO. 03/RAN/2013 PROGRESSIVE RURAL EDUCATIONAL MOVEMENTS, DUMKA -VS- CIT, DHANBAD (APPELLANT) (RESPONDEN T) APPELLANT BY : SHRI M.K.CHOUDHURY, ADVOCATE RESPONDENT BY: SHRI HARSHWARDHAN PRASAD, SR.S.C. DATE OF CONCLUDING THE HEARING : 02.05.2013 DATE OF PRONOUNCING THE ORDER : 02.05.2013 ORDER PER BENCH : THIS APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE ORDER OF THE CIT, DHANBAD PASSED UNDER SECTION 12AA(1)(B)(II) REFUSING TO GRA NT REGISTRATION TO THE ASSESSEE VIDE ORDER DATED 30.10.2012. . 2. AFTER HEARING THE RIVAL SUBMISSIONS, WE NOTED T HAT THE CIT DID NOT DISPUTE THAT THE SOCIETY IS NOT BEING CREATED FOR CHARITABLE PURPOSE S. THE ONLY OBJECTION TAKEN BY THE CIT IS THAT THE SOCIETY HAD NO PROPERTY WHICH WAS AN ES SENTIAL CONDITION FOR THE CREATION OF A SOCIETY, AS PER THE CONDITIONS LAID DOWN UNDER SECT ION 11 OF THE INCOME TAX ACT. WE HAVE GONE THROUGH THE PROVISIONS OF SECTION 12A. WE NOTED THAT THE JURISDICTION OF THE CIT UNDER SECTION 12A, WHILE GRANTING THE REGISTRAT ION IS TO SATISFY HIMSELF ABOUT THE GENUINENESS OF THE ACTIVITIES OF THE TRUST AND ALSO ASCERTAIN WHETHER THE OBJECTS OF THE TRUST OR INSTITUTION ARE CHARITABLE OR RELIGIOUS OR NOT. THE CIT DID NOT DENY THAT THE SOCIETY CREATED IS NOT GENUINE OR HAD NOT BEEN CREA TED FOR CHARITABLE OR RELIGIOUS PURPOSES. WE HAVE NOTED FROM THE INCOME & EXPENDITU RE A/C. THAT THE ASSESSEE HAS RECEIVED SALE PROCEEDS OF TRAINING CENTRE. THESE RE CEIPTS, IN OUR OPINION, ARE HIT BY THE PROVISO TO SECTION 2(15) AS THE ASSESSEE CLAIMED TH AT IT HAS BEEN ESTABLISHED FOR THE ADVANCEMENT OF OBJECTS OF GENERAL PUBLIC UTILITY. T HIS PROVISO CLEARLY STATES THAT IT WILL NOT BE CHARITABLE PURPOSE, IN CASE, THE SOCIETY IS INVOLVED IN CARRYING ON ANY ACTIVITY IN THE NATURE OF TRADE, OR BUSINESS OR ANY ACTIVITY RE NDERING IN SERVICES IN RELATION TO ANY TRADE COMMERCIAL OR BUSINESS, CESS, FEES OR FOR ANY OTHER CONSIDERATION BUT THE PROVISO FURTHER PROVIDES EMBARGO THAT THE FIRST PROVISO SHA LL NOT APPLY IF THE AGGREGATE VALUE OF THE RECEIPTS FROM THE ACTIVITIES SO CARRIED ON BY T HE SOCIETY IS RS.25 LAKHS OR LESS IN THE PREVIOUS YEAR. IN VIEW OF THE FACT, THE MOMENT THE RECEIPT OF ASSESSEE WILL BECOME RS.25 LAKHS IN RESPECT OF THE SAID COURSE OF TRAINING CEN TRE, IN OUR OPINION, THE SOCIETY NO MORE WILL REMAIN TO HAVE BEEN ESTABLISHED FOR CHARI TABLE PURPOSE. IN VIEW OF THIS, WE DIRECT THE CIT TO GRANT REGISTRATION TO THE SOCIETY UNDER SECTION 12AA WITH EMBARGO THAT IN CASE THE RECEIPTS OF THE SOCIETY FROM THE ACTIVI TY IN THE NATURE OF TRADE, BUSINESS, ETC. EXCEEDS RS.25 LAKHS, ACTION CAN BE TAKEN FOR THE CA NCELLATION OF THE REGISTRATION TO THE SOCIETY. 3. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 2 ND MAY, 2013. SD/- SD/- [D.T.GARASIA] [P.K. BANSAL] JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 2 ND MAY, 2013 COPY OF ORDER FORWARDED TO: 1. PROGRESSIVE RURAL EDUCATIONAL MOVEMENTS, DUMKA 2. CIT, DHANBAD 3. C.I.T.(A), 4. THE C.I.T., 5. THE D.R., I.T.A.T., TRUE COPY, BY ORDER, SR. PRIVATE SECRETARY (ON TOUR) ITAT, RANCHI [MST, SR.PS ]