Paramount Charity Trust, Baroda V. Commissioner of Income Tax,1, Baroda

ITA 3119/AHD/2014

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 5964 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 3 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-02-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 11-07-2017
• Assessment Year: misc
• Appeal Filed On: 24-11-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VASUNDHARA UPMANYU
• Assessee Lawyers: M K PATEL
• Keywords: Charitable institution; Opportunity of being heard; Rule of consistency; Retrospective amendment
• Section: 143(3); 80G; 12A; 12AA; 10

Judgement Text

, - IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH D BEFORE SHRI PRAMOD KUMAR, ACCOUNTANT MEMBER AND SHRI RAJPAL YADAV, JUDICIAL MEMBER ./ ITA NO.3119/AHD/2014 / ASSTT. YEAR: - PARAMOUNT CHARITY TRUST PARAMOUNT COMPLEX NR. NATUBHAI CIRCLE, GOTRI ROAD RACE COURSE BARODA 390 007. VS. CIT(1)-1 BARODA. / (APPELLANT) / (RESPONDENT) ASSESSEE BY : SHRI M.K. PATEL, AR REVENUE BY : SHRI VASUNDHARA UPMANYU, CIT-DR ! / DATE OF HEARING : 19/01/2018 '#$ ! / DATE OF PRONOUNCEMENT: 27/02/2018 %& / O R D E R PER RAJPAL YADAV, JUDICIAL MEMBER: PRESENT APPEAL IS DIRECTED AT THE INSTANCE OF THE A SSESSEE AGAINST ORDER OF LD.CIT-I DATED 30.9.2014 PASSED UN DER SECTION 12AA(3) OF THE INCOME TAX ACT, 1961 VIDE WHICH THE LD.COMMISSIONER HAS CANCELLED REGISTRATION GRANTED TO ASSESSEE UNDER SECTION 12A OF THE ACT. 2. ORIGINALLY ASSESSEE TOOK SEVEN GROUNDS OF APPEAL , WHICH WERE RUNNING INTO THREE PAGES, THUS, THEY WERE DESC RIPTIVE AND ARGUMENTATIVE IN NATURE. HOWEVER, SUBSEQUENTLY ASS ESSEE HAS ITA NO.3119/AHD/2014 2 REVISED GROUNDS. IN THE CONCISE GROUND, IT HAS PLE ADED THAT THE LD.COMMISSIONER HAS ERRED IN CANCELLING REGISTRATIO N UNDER SECTION 12AA W.E.F. THE AMENDMENTS MADE IN TRUST DEED. 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE-TRU ST CAME INTO EXISTENCE ON 15.6.1977 WHEN IT WAS REGISTERED WITH ASSISTANT CHARITY COMMISSIONER, BARODA VIDE REGISTRATION NO.E/2469/VADODARA. IT WAS A PUBLIC CHARITABLE TRU ST. THE ASSESSEE-TRUST HAS APPLIED FOR GRANT OF REGISTRATIO N UNDER SECTION 12A OF THE INCOME TAX ACT. THIS, APPLICATION OF TH E ASSESSEE WAS ALLOWED AND IT WAS GRANTED REGISTRATION ON 1.1.1982 VIDE ORDER DATED BRD/SIB/110-6-P/81. AT THIS STAGE, IT IS PERT INENT TO TAKE NOTE OF OBJECTS OF ASSESSEE-TRUST IN ORIGINAL TRUST DEED. SUCH OBJECTS HAVE BEEN ENUMERATED BY THE LD.COMMISSIONER IN THE SHOW CAUSE NOTICE ISSUED FOR CANCELLATION OF REGIST RATION. THEY ARE AVAILABLE AT PAGE NO.2 OF THE IMPUGNED ORDER. THEY READ AS UNDER: (1) TO ESTABLISH AND OR ACQUIRE MAINTA IN SUPPORT OF SCHOOLS, COLLEGES, VIDHYAPEETHS AND OTHER INS TITUTIONS FOR IMPARTING EDUCATION AND TRAINING OF STUDENTS AND/OR TEACHERS IN SUCH LINES OR COURSES AS THE TRUSTEES MAY FROM T IME TO TIME DEEM FIT. (2) TO PROMOTE EDUCATION, LEARNING VOCATIONAL TRAIN ING IN ALL THE BRANCHES (3) TO CONDUCT EXPERIMENTS, RESEARCH PROJECT ETC. (4) TO PREPARE AND PUBLISH REPORTS MAGAZINES AND AN Y OTHER PUBLICATIONS (5) TO GRANT MONETARY ASSISTANCE FROM TIME TO TIME TO ANY SCHOOLS, COLLEGES, LIBRARIES, READING ROOMS AND OTH ER INSTITUTIONS WHICH IMPART EDUCATION UPON SUCH CONDI TIONS AS THE TRUSTEES MAY DEEM FIT. (6) TO GRANT MONETARY ASSISTANCE BY WAY OF BUYING B OOKS, FOOD AND CLOTHES, SCHOOL OR COLLEGE FEES, INCLUDING SCHOLARSHIP AND/OR LOANS TO POOR DESERVING STUDENTS, OR TRAINEE S TO ENABLE THEM TO RECEIVE SUCH EDUCATION TRAINING AND ITA NO.3119/AHD/2014 3 QUALIFICATION IN INDIA OR ABROAD AS THE TRUSTEES MA Y APPROVE AND FOR SUCH PERIOD AS THE TRUSTEES MAY DEEM FIT. (7) TO ARRANGE EDUCATIONAL CAMPAIGNS, EXHIBITIONS, STUDY CIRCLE LECTURES, DISCUSSIONS ETC. (8) TO GRANT RELIEF IN ANY FORM TO DISABLED AND POO R. (9) TO GRANT SUBSCRIPTION AND DONATIONS TO HOSPITAL S, DISPENSARIES, CONVALESCENT HOMES, ASYLUMS, NURSING HOMES AND OTHER PUBLIC INSTITUTES FOR ADMINISTERING THE M EDICAL RELIEF TO THE POOR UPON SUCH TERMS AND CONDITIONS F OR SUCH PERIOD AS THE TRUSTEES MAY THINK FIT. (10) TO ORGANIZE AND RENDER RELIEF WORK IN NORMAL T IMES AS WELL AS IN THE EVENT OF ANY NATIONAL OR LOCAL CATAS TROPHE SUCH AS FAMINE, FLOOD, FIRE, EPIDEMIC, WAR ETC, (11) TO SUBSCRIBE CONTRIBUTE AND/TO DONATE TO ANY P UBLIC CHARITABLE OBJECTS AS STATED ABOVE AND SUCH AS RELI EF BY MEANS OF PECUNIARY OR ANY OTHER HELP IN THE SHAPE O F MONTHLY OR PERIODICALLY ALLOWANCES/LOANS. OTHERWISE TO SUCH PARTIES AS SHALL IN THE OPINION OF THE TRUSTEES DEE M FIT. (12) THE TRUSTEES SHALL HAVE FULL POWER AND ABSOLUT E AUTHORITY TO ADD AND INTRODUCE ANY OTHER SPECIFIC P UBLIC CHARITABLE OBJECTS NOT IN CONSISTENT WITH THE OBJEC TS AND PURPOSE OF THIS PRESENTS AND IN THAT CASE SUCH NEWL Y ADDED SUBJECTS DECIDED BY THE TRUSTEES SHALL BE DEEM TO H AVE BEEN INCORPORATED IN THE OBJECTS OF THESE PRESENTS. THIS IS SUBJECT TO THE BOMBAY PUBLIC TRUST ACT. 4. IT IS PERTINENT TO MENTION THAT THE ASSESSEE-TRU ST WAS GRANTED REGISTRATION UNDER SECTION 80G(5) OF THE AC T WHICH WAS RENEWED FROM TIME TO TIME. ACCORDING TO THE ASSESS EE, ASSISTANT COMMISSIONER OF CHARITY UNDER BOMBAY PUBLIC TRUST AC T 1980 CARRIED OUT AN INQUIRY UNDER SECTION 22A OF THIS AC T WITH REGARD TO OBJECTS OF THE ASSESSEE. IT WAS NOTICED THAT IN CL AUSE (6) OF THE OBJECT CLAUSE THE EXPRESSION ABROAD MEANS THAT AS SISTANCE COULD BE GIVEN WITHIN AND OUTSIDE INDIA. THUS, ON THE BA SIS OF THIS INQUIRY THE TRUSTEES AMENDED TRUST-DEED ON 24.6.197 7. THEY HAVE UNANIMOUSLY AGREED TO DELETE THE WORD ABROAD TO INCLUDE EXPRESSION EDUCATION AND TRAINING OF STUDENTS/TEAC HERS IN CLAUSE (3), (4) AND (7) OF THE ORIGINAL TRUST-DEED. IT WA S POINTED OUT TO ITA NO.3119/AHD/2014 4 THE LD.COMMISSIONER THAT IN 1989-90 THERE WAS AN AC UTE NEED FOR SETTING UP OF A CENTRE WHICH COULD PROVIDE MEDICAL DIAGNOSTIC SERVICES TO PUBLIC OF BARODA BECAUSE THERE WERE NO F ACILITIES AVAILABLE AT THE RELEVANT TIME IN THE CITY AND PATI ENTS HAVE TO TRAVEL FAR PLACES IN AHMEDABAD AND OTHER PLACES. T HUS, AN AMENDMENT WAS CARRIED OUT IN THE TRUST DEED BY WAY OF A RESOLUTION DATED 24.2.1990. THE FOLLOWING OBJECTS WHICH ACCORDING TO THE ASSESSEE ANCILLIARY TO ALREADY EXISTING OBJE CTS WERE ADDED. 13) TO PROVIDE ALL KINDS OF MEDICAL, DIAGNOSTIC, F AMILY WELFARE AND GENERAL HEALTH FACILITIES AND TREATMENT TO THE PATIENTS, IN THE FIELD OF ALLOPATH, HOMEOPATHY, OR AYURVED, WITHOUT ANY DISTINCTION OF CASTES, CREED, RACE, REL IGION OR LANGUAGE BASIS, EITHER ON FREE OF CHARGE OR NO PROF IT BASIS. TO BUY, ACQUIRE, HIRE, TAKE ON LEASE, IMPORT MEDICA L OR DIAGNOSTIC MACHINERIES AND EQUIPMENTS TO RUN A HOSP ITAL, DISPENSARY, MATERNITY HOME, NURSING HOME, DIAGNOSTI C CENTRE, SANATORIUM OR CAMPS AND TO CONSTRUCT OR ACQ UIRE ON RENT OR OTHERWISE, ANY BUILDING OR PREMISES TO PROV IDE THE ABOVE FACILITIES AND TO EMPLOY TECHNICAL AND NON-TE CHNICAL PERSONNEL AND TO CONSULT EXPERTS AND SPECIALISTS IN THE RELEVANT FIELDS OF MEDICINE FOR THE PURPOSE OF PROP ER AND SMOOTH OPERATIONS OF THE ABOVE OBJECTS. 5. ACCORDING TO THE LD.COMMISSIONER THE FACT WITH R EGARD TO ADDITION OF ABOVE OBJECTS WERE BEING NOTICED BY THE AO WHILE PASSING ASSESSMENT ORDER IN THE ASSTT.YEAR 2010-11. HE FORMED AN OPINION THAT ADDITION OF THESE OBJECTS IN THE TR UST WITHOUT COMMUNICATION TO THE DEPARTMENT WOULD EXPOSE THE AS SESSEE FOR IRREGULARITIES IN CONDUCTING ITS ACTIVITIES INCONSI STENT TO OBJECTS ORIGINALLY PURSUED BY THE ASSESSEE ON THE BASIS OF REGISTRATION GRANTED UNDER SECTION 12A. THUS, HE ISSUED A SHOW CAUSE BY EXERCISING POWER UNDER SECTION 12AA(3) OF THE ACT F OR WITHDRAWAL OF APPROVAL GRANTED TO THE ASSESSEE UNDER SECTION 1 2A OF THE ACT. ITA NO.3119/AHD/2014 5 COPY OF THE SHOW CAUSE NOTICE HAS BEEN REPRODUCED I N THE IMPUGNED ORDER. IN RESPONSE TO THE SHOW CAUSE NOTI CE, THE ASSESSEE HAS FILED DETAILED SUBMISSIONS. SUBMISSIO NS RUNNING INTO 33 PAGES HAVE BEEN NOTICED BY THE LD.COMMISSIONER V ERBATIM IN THE IMPUGNED ORDER NOS.5 TO 39. AFTER CONSIDERING SUBMISSIONS OF THE ASSESSEE, THE LD.COMMISSIONER HAS HELD THAT DIA GNOSTIC CENTRE BEING RUN BY THE ASSESSEE IS COMMERCIAL VENTURE WHI CH WAS NOT THERE IN THE ORIGINAL OBJECTS, HENCE, IT IS INCONSI STENT TO OBJECTS ON WHOSE GENUINENESS, REGISTRATION UNDER SECTION 12A W AS GRANTED. THE LD.COMMISSIONER HAS CANCELLED THE REGISTRATION W.E.F. THE DATE AMENDMENT WAS MADE IN THE TRUST DEED. 6. BEFORE US WHILE IMPUGNING ORDER OF THE LD.COMMISS IONER, THE ASSESSEE HAS REITERATED ITS SUBMISSIONS REPRODUCED IN THE IMPUGNED ORDER. IT WAS CONTENDED BY THE LD.COUNSEL FOR THE ASSESSEE THAT AS PER SECTION 22 OF THE BOMBAY PUBLIC TRUST ACT, CHANGES IN THE TRUST DEED WAS DULY BROUGHT TO THE N OTICE OF THE LD.ASSISTANT CHARITY COMMISSIONER. THE CHANGES WER E DULY NOTIFIED AND RECORDED ON 8.5.1990 IN THE REGISTER O F PUBLIC TRUST MAINTAINED BY THE LD.COMMISSIONER. COPY OF SUCH DE TAILS IS BEING PLACED ON PAPER BOOK ON PAGE NO.72. HE ALSO POINTE D OUT THAT ON THE BASIS OF THESE CHANGES AND REGISTRATION UNDER BO MBAY PUBLIC TRUST ACT IT COULD AVAIL LOAN FROM IOB. 7. IN ITS SECOND FOLD OF CONTENTIONS, IT WAS SUBMIT TED THAT REGISTRATION UNDER SECTION 80G OF THE ACT WAS GRANT ED TO THE ASSESSEE IN 1977. MEANING THEREBY, DONORS OF THE A SSESSEE COULD AVAIL EXEMPTION FROM PAYMENT OF TAX ON SUCH DONATIO N. AFTER AMENDMENT CARRIED OUT ON 1.4.1990 BY INCLUDING OF O BJECTS NUMBER 13 IN THE TRUST-DEED, IT HAS APPLIED FOR REN EWAL OF ITA NO.3119/AHD/2014 6 REGISTRATION GRANTED UNDER SECTION 80G IN FORM NO.1 0G ON 31.3.1991. COPY OF SUCH APPLICATION HAS BEEN PLACE D IN THE PAPER BOOK ON PAGE NO.81 AND 82. ACCORDING TO THE LD.COU NSEL FOR THE ASSESSEE, IT WAS MANDATORY TO FILE FOLLOWING DOCUME NTS FOR GRANT OF REGISTRATION UNDER SECTION 80G OF THE ACT VIZ. ( A) COPY OF INCOME TAX REGISTRATION CERTIFICATE, (B) TRUST DEED , (C) DETAILS OF ACTIVITIES SINCE ITS INCEPTION OR LAST THREE YEARS, WHICHEVER IS LESS, (D) COPY OF AUDITED ACCOUNTS OF INSTITUTION SINCE I TS INCEPTION OR LAST THREE YEARS WHICHEVER IS LESS. THE ASSESSEE HAS SUBMITTED COPY OF THE TRUST-DEED INCLUDING ADDITION OF OBJECT S UNDER CLAUSE 13. BASED ON THESE DETAILS, ITS APPLICATION FOR REN EWAL UNDER SECTION 80G WAS ALLOWED VIDE LETTER DATED 11.12.199 1. COPY IS PLACED AT PAGE NO.84 OF THE PAPER BOOK. THEREAFTER THE SAID APPROVAL IS RENEWED FROM TIME TO TIME, AND ULTIMATE LY VIDE LETTER DATED 19.9.2012 LD.CIT INFORMED THE TRUST THAT APPR OVAL WOULD IN PERPETUITY. THE LETTER IS PLACED ON PAGE NO. 132 O F THE PAPER BOOK. THE LD.COUNSEL FOR THE ASSESSEE CONTENDED TH AT THE ASSESSEE-TRUST FILED APPLICATION TO THE AO IN FORM NO.10 FOR ACCUMULATION OF INCOME UNDER SECTION 11(2) OF THE A CT, WHICH WAS GRANTED UPTO ASSTT.YEAR 2010-11. THE LD.COUNSEL FO R THE ASSESSEE FURTHER SUBMITS THAT TRUST HAS CARRIED OUT THESE AC TIVITIES OF DIAGNOSTIC CENTRE SINCE 1990 TILL TODAY. IT HAS BE EN FILING INCOME RETURNS ALONG WITH AUDITED ACCOUNTS SHOWING THIS IN COME FROM CT/MRI SCANNING AND GRANTED EXEMPTION UNDER SECTION 11/11()2) OF THE ACT TILL A.Y.2010-11. HE ALSO POINTED OUT T HAT IN SOME OF THE YEARS ASSESSMENTS WERE REOPENED AND AFTER DETAI LED SCRUTINY OF ALL THE REPLIES/DOCUMENTS FILED BY THE ASSESSEE WERE GONE THROUGH. ASSESSMENTS WERE FRAMED ACCEPTING STAND O F THE ASSESSEE FOR GRANT OF BENEFIT UNDER SECTIONS 11/12 OF THE ACT. HE ITA NO.3119/AHD/2014 7 DREW OUR ATTENTION TOWARDS PAGE 161 TO 252 OF THE P APER BOOK WHEREIN DOCUMENTS RELATING TO THE ASSESSMENTS OF TH E ASSTT.YEARS 2003-04, 2005-06, 2006-07 AND 2010-11 ARE PLACED. ASSESSMENT ORDER FOR THE ASSTT.YEAR 2005-06 WAS PASSED UNDER S ECTION 143(3) AND COPY OF THE SAME IS AVAILABLE ON PAGE NO.199 OF THE PAPER BOOK. SIMILARLY, ASSESSMENT ORDER FOR THE ASSTT.YE AR 2006-07 WAS ALSO PASSED UNDER A SCRUTINY ASSESSMENT UNDER SECTI ON 143(3) AND COPY OF THIS ASSESSMENT ORDER IS PLACED ON PAGE NO. 219 OF THE PAPER BOOK. THUS, ACCORDING THE LD.COUNSEL FOR THE ASSESSEE RIGHT FROM 1-4-1990, FACT WITH REGARD TO INCLUSION OF MED ICAL RELIEF IN ITS OBJECT WAS KNOWN TO THE DEPARTMENT. IT HAS CONSIDE RED ALL THESE ASPECTS AND DID NOT DISTURB ITS AFFAIRS. IN OTHER WORDS, IT HAS ACCEPTED THE ASSESSEE AS A CHARITABLE INSTITUTION F ROM LAST 20-25 YEARS. IT IS WRONG AT THE END OF THE LD.COMMISSION ER TO OBSERVE THAT THE ASSESSEE HAS WITHHELD THE INFORMATION. HE RELIED UPON THE FOLLOWING DECISIONS: I) BHANSALI TRUST, ITAT, MUMBAI ITA NO.5948/MUM/2012 II) MEHTA JIVERAJ MAKANDAS & PAREKH TRUST, ITAT, MUMBAI ITA NO.2212/MUM/2010; III) MOOLCHAND KHAIRATI RAM TRUST, DELHI HIGH COURT, ITA NO.141/2013; IV) VIVEKANAND GENERAL HOSPITAL, ITAT, BANGALORE, ITA NO.1195 & 1196/2012; V) SHREE BALAJI EDUCATIONAL TRUST, ITAT, NEW DELHI, IT NO.877/DEL/2014; VI) SHREE ANJANEY MEDICAL TRUST, KERALA HIGH COURT, ITA NO.17 OF 2015; VII) SAMARPAN SAMITI, ITAT, AGRA, ITA NOS.427/2011 & 36/2012 8. HE ALSO PLACED ON RECORD COPIES OF THESE DECISIO NS. 9. IN HIS NEXT FOLD OF SUBMISSION, IT WAS SUBMITTED THAT DIAGNOSTICS FACILITY FALLS WITHIN THE AMBIT OF MEDI CAL RELIEF AS PER ITA NO.3119/AHD/2014 8 SECTION 2(15). THIS ACTIVITY IS PER SE A CHARITABLE. EVEN IF SOME INCIDENTAL PROFITS ON PERFORMING A CHARITABLE ACTIV ITIES RESULT TO THE ASSESSEE THEN THAT SURPLUS IS ALWAYS APPLIED FOR TH E OBJECTS OF THE TRUST. IT IS NOT BEING POCKETED EITHER BY THE TRUS TEE OR BY SOME PERSONS. SECTION 13 OF THE ACT DULY TAKE CARE OF A NY SURPLUS GENERATED BY A CHARITABLE TRUST AND ALSO TAKE CARE OF THE ACTIVITIES FOR SOME UNDUE BENEFIT IS BEING GIVEN EITHER TO THE TRUSTEES OR ANY PERSONS ASSOCIATED WITH THE TRUST. HE MADE REFEREN CE TO SUB- CLAUSE (3) OF SECTION 13 IN THIS REGARD. HE RELIED UPON FOLLOWING DECISION FOR BUTTRESSING THAT REGISTRATION COULD NO T BE CANCELLED BY THE LD.COMMISSIONER MORE SO, FROM DATE SUCH ALTERAT ION WAS MADE TO THE TRUST DEED. I) MEHTA JIVERAJ MAKANDAS & PAREKH TRUST, ITAT, MUMBAI ITA NO.2212/MUM/2010; II) BHANSALI TRUST, ITAT, MUMBAI ITA NO.5948/MUM/2012 III) MOOLCHAND KHAIRATI RAM TRUST, DELHI HIGH COURT, ITA NO.141/2013; IN OTHER WORDS, THERE IS NO POWER WITH THE LD.COMMI SSIONER TO CANCEL REGISTRATION WITH RETROSPECTIVE EFFECT I.E. PRIOR TO THE DATE WHEN EVEN SHOW CAUSE NOTICE WAS NOT ISSUED. 10. THE LD.CIT-DR ON THE OTHER HAND RELIED UPON THE ORDER OF LD.COMMISSIONER. SHE POINTED OUT THAT FORM NO.10G HAS BEEN DESIGNED AS PER RULE 17A OF THE INCOME TAX RULES. CONDITIONS CONTEMPLATED IN THIS FORM ARE BEING VIOLATED AS IT CONTEMPLATES THAT APPLICANT WOULD INFORM AUTHORITY ANY ALTERATIO N IN THE TERMS/OBJECT OF THE TRUST OR EVEN IN THE RULE GOVER NING INSTITUTION. THE MOMENT ASSESSEE FAILED TO INFORM THE DEPARTMENT ABOUT CHANGES IN THE TRUST DEED, ITS OBJECT WOULD NOT BE GENUINE AND REGISTRATION DESERVES TO BE CANCELLED. SHE POINTED OUT THAT THE ITA NO.3119/AHD/2014 9 LD.COMMISSIONER HAS CONSIDERED THIS ASPECT ELABORAT ELY IN THE IMPUGNED ORDER AND HAS ALSO RIGHTLY CANCELLED THE R EGISTRATION. 11. WE HAVE CONSIDERED RIVAL CONTENTIONS AND GONE T HROUGH THE RECORD CAREFULLY. SECTION 2(15) AND 12AA(3) ARE TH E PROVISIONS, WHICH HAVE DIRECT BEARING ON THE CONTROVERSY. THER EFORE, IT IS PERTINENT TO TAKE NOTE OF RELEVANT PART OF THESE PR OVISIONS WHICH READ AS UNDER: SECTION 2(15) CHARITABLE PURPOSE' INCLUDES RELIEF OF THE POOR, EDUCATION, [YOGA,] MEDICAL RELIEF, [PRESERVATION OF ENVIRONMENT (INCLUDING WATERSHEDS, FORESTS AND WILDLIFE) AND PRESERVATION OF MONUMENTS OR PLACES OR 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 OF GENERAL PUBLIC UTILITY SHALL NOT BE A CHARITABLE PURPOSE, IF IT INVOLVES THE CARRYING ON OF ANY ACTIVITY IN THE NAT URE OF TRADE, COMMERCE OR BUSINESS, OR ANY ACTIVITY OF REN DERING ANY S ERVICE IN RELATION TO ANY TRADE, COMMERCE OR BUSINE SS, FOR A CESS OR FEE OR ANY OTHER CONSIDERATION, IRRES PECTIVE OF THE NATURE OF USE OR APPLICATION, OR RETENTION, OF THE INCOME FROM SUCH ACTIVITY, UNLESS (I) SUCH ACTIVITY IS UNDERTAKEN IN THE COURSE OF ACTUAL CARRYING OUT OF SUCH ADVANCEMENT OF ANY OTHER OBJEC T OF GENERAL PUBLIC UTILITY; AND (II) THE AGGREGATE RECEIPTS FROM SUCH ACTIVITY OR ACTIVI TIES DURING THE PREVIOUS YEAR, DO NOT EXCEED TWENTY PER CENT OF THE TOTAL RECEIPTS, OF THE TRUST OR INSTITUTION UNDERTAKING SUCH ACTIVITY OR ACTIVITIES, OF THAT PREVIOUS YEAR;]] SECTION 12AA(3) ' SECTION 12AA(3) STATES THAT WHERE A TRUST OR AN I NSTITUTION HAS BEEN GRANTED REGISTRATION UNDER CLAUSE (B) OF S UB- SECTION(1) [OR HAS OBTAINED REGISTRATION AT ANY TIM E UNDER ITA NO.3119/AHD/2014 10 SECTION 12A [AS IT STOOD BEFORE ITS AMENDMENT BY TH E FINANCE (NO.2) ACT, 1996 (33 OF 1996)]] AND SUBSEQU ENTLY THE COMMISSIONER IS SATISFIED THAT THE ACTIVITIES O F SUCH TRUST OR INSTITUTION ARE NOT GENUINE OR ARE NOT BEING CAR RIED OUT IN ACCORDANCE WITH THE OBJECTS OF THE TRUST OR INSTITU TION, AS THE CASE MAY BE, HE SHALL PASS AN ORDER IN WRITING CANC ELLING THE REGISTRATION OF SUCH TRUST OR INSTITUTION: PROVIDED THAT NO ORDER UNDER THIS SUB-SECTION SHALL BE PASSED UNLESS SUCH TRUST OR INSTITUTION HAS BEEN GIVEN A R EASONABLE OPPORTUNITY OF BEING HEARD.' 12. A PERUSAL OF SECTION 2(15) WOULD INDICATE THAT THIS CLAUSE CONTEMPLATES MEANING OF EXPRESSION CHARITABLE PURP OSE, AND IN THAT STRIDE IT ILLUSTRATES FEW ACTIVITIES OF AN INS TITUTION FOR FALLING WITHIN THE AMBIT OF CHARITABLE PURPOSE IN TWO CAT EGORIES, VIZ. IN THE FIRST CATEGORY CHARITABLE PURPOSE WOULD INDIC ATE RELIEF TO THE POOR, EDUCATION, YOGA, MEDICAL RELIEF, PRESERVATION OF ENVIRONMENT . AND IN THE SECOND CATEGORY ADVANCEMENT OF ANY OTHER OBJECTS OF GENERAL PUBLIC UTILITY. SO FAR AS OBJEC TS PERFORMED FOR ACTIVITIES CARRIED OUT IN THE FIRST CATEGORY ARE CO NCERNED, THESE ACTIVITIES ARE PER SE CHARITABLE. WE HAVE TAKEN COGNIZANCE OF THIS CLAUSE; IN ORDER TO EXAMINE THE ISSUE WHETHER INCLU SION OF ANY NEW OBJECTS BY AN AMENDMENT TO TRUST-DEED IS TO BE CONS TRUED AS AN ILLEGALITY WHICH WOULD DISENTITLE THE ASSESSEE FROM REGISTRATION UNDER SECTION 12AA AND CONSEQUENTLY REGISTRATION EA RLIER GRANTED TO THE ASSESSEE DESERVES TO BE CANCELLED. OTHERWIS E, IT IS TO BE SEEN WHETHER NON-COMMUNICATION OF AMENDED TRUST-DEE D TO THE DEPARTMENT WAS A MERE IRREGULARITY WHICH COULD HAVE BEEN OR WHICH SHOULD HAVE BEEN RECTIFIED BY THE LD.COMMISSI ONER INSTEAD OF CANCELLING THE REGISTRATION. BEFORE CONSIDERING THESE ASPECTS, LET US APPRAISE OURSELVES WITH THE POWER OF LD.COMM ISSIONER PROVIDED UNDER SECTION 12AA(3) OF THE INCOME TAX AC T AS ITA NO.3119/AHD/2014 11 EXTRACTED (SUPRA). A PERUSAL OF THE ABOVE SECTION WOULD INDICATE THAT WHERE A TRUST OR INSTITUTION WAS GRANTED REGIS TRATION UNDER SECTION 12AA AND SUBSEQUENTLY, THE LD.COMMISSIONER IS SATISFIED THAT ACTIVITIES OF SUCH TRUST OR INSTITUTION ARE NO T GENUINE OR ARE NOT BEING CARRIED OUT IN ACCORDANCE WITH OBJECTS OF THE TRUST OR INSTITUTION, AS THE CASE MAY, HE SHALL PASS AN ORDE R IN WRITING CANCELLING OF SUCH TRUST OR INSTITUTION. IT MEANS, IF THE COMMISSIONER IS SATISFIED THAT ACTIVITIES OF SUCH T RUSTS OR INSTITUTION ARE NO LONGER REMAINED GENUINE OR THEE ARE NOT CARRIED OUT ACTIVITIES IN ACCORDANCE WITH OBJECTS OF THE TR UST, THEN AFTER PROVIDING AN OPPORTUNITY OF HEARING TO AN ASSESSEE HE WILL CANCEL REGISTRATION BY PASSING AN ORDER IN WRITING. TWO I MPORTANT FACTORS OUGHT TO BE CONSIDERED BY THE LD.COMMISSIONER I.E. EITHER OBJECTS ARE NOT GENUINE OR THEY ARE NOT BEING UNDERTAKEN BY THE TRUST, INSTEAD OF THAT TRUST HAS BEEN DOING OTHER ACTIVITI ES. AS OBSERVED EARLIER, ACTIVITIES PERFORMED OR OBJECTS OF THE ASS ESSEE-TRUST ARE CONCERNED, THEY ARE PER SE CHARITABLE. EVEN NEW OBJECTS INCLUDED BY THE ASSESSEE VIDE AMENDMENT DATED 1.4.1990 IS AL SO CHARITABLE IN NATURE. THUS, QUESTION BEFORE US IS WHETHER OBJ ECTS OF THE ASSESSEE-TRUST ARE NON-GENUINE OR IT HAS COMMENCED ANY ACTIVITIES WHICH ARE NOT IN ACCORDANCE WITH OBJECTS OF THE TRUST. A PERUSAL OF IMPUGNED ORDER WOULD INDICATE THAT THE LD.COMMISSIONER BASICALLY DID NOT EXAMINE OBJECTS O F THE ASSESSEE-TRUST. HE SIMPLY HARBOURED A BELIEF THAT DIAGNOSTIC CENTRE IS TO BE CATEGORIZED AS A COMMERCIAL VENTURE WHICH DOES NOT FULFILL ANY PHILANTHROPIC OBJECTS. IN HIS SECO ND OBJECTION, HE FURTHER OBJECTS THAT SINCE RUNNING OF A DIAGNOSTIC CENTRE WAS NOT PART OF ORIGINAL OBJECTS ON WHOSE GENUINENESS REGIS TRATION WAS GRANTED TO THE ASSESSEE, THEREFORE IT IS TO BE CONS TRUED THAT THE ITA NO.3119/AHD/2014 12 ASSESSEE-TRUST HAS NOT CARRIED ACTIVITIES IN ACCORD ANCE WITH OBJECTS ON THE BASIS OF WHICH REGISTRATION UNDER SECTION 12 A WAS GRANTED TO IT. 13. AT THIS STAGE, BEFORE ADVERTING TO THE SPECIFIC FACTS OF THE PRESENT CASE, WE WOULD LIKE TO TAKE NOTE OF THE CAS E LAWS RELIED BY THE LD.COUNSEL FOR THE ASSESSEE IN ORDER TO APPRAIS E US WHETHER NON-COMMUNICATION OF AN AMENDED TRUST-DEED AS ACCEP TED BY THE REVENUE WOULD AUTOMATICALLY BE CONSTRUED THAT REGIS TRATION TO THE ASSESSEE-TRUST WOULD BE CANCELLED. FIRST DECISION REFERRED BY THE LD.COUNSEL FOR THE ASSESSEE IS THAT ORDER OF THE IT AT, MUMBAI BENCH IN THE CASE OF BHANSALI TRUST (SUPRA). IN THIS CASE THE ASSESSEE TRUST CAME INTO EXISTENCE ON 19.3.1969. I T WAS REGISTERED UNDER SECTION 12A. IT HAD CARRIED OUT C HARITABLE ACTIVITIES FOR MORE THAN 50 YEARS, BUT THE LD.AO DE NIED BENEFIT UNDER SECTIONS 11/12 OF THE ACT IN THE ASSTT.YEAR 2 009-10 BY HOLDING THAT OBJECTS OF THE TRUST HAVE BEEN AMENDED AFTER GRANT OF REGISTRATION UNDER SECTION 12A OF THE ACT. THE ASSE SSEE TRUST OUGHT TO HAVE BEEN GOT IT RE-REGISTERED WITH DIT(EX EMPTION) UNDER SECTION 12A OF THE ACT AFTER SUCH AMENDMENT I N THE OBJECTS. IN THIS BACKGROUND, TRIBUNAL HAS MADE FOLLOWING DIS CUSSION: 3 IN THE BACKGROUND OF THE ABOVE ANALYSIS OF THE CHANGES IN THE OBJECT CLAUSE, IN OUR VIEW, THERE IS NO CHAN GE IN THE TONE AND TENOR OF THE OBJECTS PURSUED BY THE ASSESS EE IN A REAL SENSE. IN FACT, OUR AFORESAID ANALYSIS OF T HE CHANGES IN THE TRUST DEED, DO NOT REFLECT THAT THAT OBJECTS OF THE ASSESSEE TRUST HAS UNDERGONE CHANGES BUT THE AMENDM ENTS ARE MERELY ENABLING CLAUSES WHICH PROVIDE ONLY 'MEA NS' OR POWER' TO ACHIEVE OBJECTS IN THE TRUST DEED. IN OUR CONSIDERED OPINION, HAVING REGARD TO THE AFORESAID FACT SITUATION, IT WOULD BE INAPPROPRIATE TO CONSTRUE TH E AMENDMENTS OF 1957 AND 1979 AS INSERTIONS OF ANY NEW OBJECTS OF THE ASSESSEE TRUST, RATHER THE AMENDMENT S ONLY ITA NO.3119/AHD/2014 13 SEEK TO PROVIDE ENABLING POWERS TO THE TRUST TO ACC OMPLISH ITS ORIGINAL OBJECTS WHICH ARE IN THE FIELDS OF EDU CATIONAL PURPOSE, MEDICAL PURPOSE, RELIEF OF POVERTY AND OBJ ECTS OF GENERAL PUBLIC UTILITY NOT INVOLVING CARRYING ON AN Y ACTIVITY FOR PROFIT. IN FACT, HON'BLE BOMBAY HIGH COURT IN THE CA SE OF DECCAN GYMKHANA VS. CIT, 262 ITR 459 (BOM) AS WELL A S THE JUDGMENT OF HON'BLE SUPREME COURT IN THE CASE OF PH D CHAMBER OF COMMERCE & INDUSTRY VS. DIT,130 ITR 186 (SC) HAS LAID DOWN THAT A DISTINCTION HAS TO BE MADE BET WEEN THE 'PURPOSE' OF A TRUST AND THE 'POWERS' CONFERRED UPO N THE TRUSTEES AS BEING INCIDENTAL TO ACCOMPLISH THE PURP OSE OF THE TRUST. IN OUR CONSIDERED OPINION, THE AMENDMENTS IN 1975 &1979, WHICH HAVE BEEN NOTICED ABOVE ONLY SEEK TO E NABLE THE TRUSTEES TO CARRY OUT ACTIVITIES FOR ACCOMPLISH ING THE PURPOSE OF THE TRUST WHICH WE HAVE FOUND EARLIER TO BE FOR A 'CHARITABLE PURPOSE' AS PER ORIGINAL TRUST DEED. TH EREFORE, FACTUALLY SPEAKING, EVEN IF ONE HAS TO CONSIDER THE AMENDMENTS OF 1975 & 1979 MADE IN THE TRUST DEED, I N OUR VIEW IT DOES NOT SIGNIFY THAT THE REGISTRATION GRAN TED TO THE ASSESSEE ON 27/11/1973 UNDER SECTION 12A OF THE ACT IS RENDERED NUGATORY. 14. THE TRIBUNAL HAS CONSIDERED JUDGMENT OF HONBLE ALLAHABAD HIGH COURT IN THE CASE OF ALLAHABAD AGRICULTURAL IN STITUTE & ANOTHER VS. UNION OF INDIA AND OTHERS, 291 ITR 116 (ALL). THE LD.CIT(A) ALLOWED BENEFIT UNDER SECTIONS 11/12 TO S UCH ASSESSEE AND TRIBUNAL UPHELD ALLOWANCE OF SUCH BENEFIT. 15. NEXT DECISION RELIED UPON BY THE LD.COUNSEL FOR THE ASSESSEE WAS FROM THE ORDER OF ITAT, MUMBAI BENCH IN THE CASE OF MEHTA JIVARAJ MAKANDAS & PAREKH TRUST (SUPRA). IN THIS C ASE ALSO, THE ASSESSEE TRUST GOT REGISTRATION UNDER SECTION 12A O N 21.11.1975. ITS OBJECTS WERE AMENDED AND IT FILED AN APPLICATIO N FOR RENEWAL OF REGISTRATION UNDER SECTION 80G ON 13.4.2001 WHICH W AS DENIED TO THE ASSESSEE. ALLEGATION AGAINST THE ASSESSEE WAS THAT IT HAD NOT COMPLIED WITH REQUIREMENT IN THE STATUTORY FORM NO. 10A BECAUSE THE ASSESSEE HAD TO GIVE AN UNDERTAKING TO COMMUNIC ATE FORTHWITH ITA NO.3119/AHD/2014 14 ANY ALTERATION IN OBJECTS OF THE TRUST OR IN THE RU LE GOVERNING INSTITUTION. ACCORDING TO THE REVENUE CHANGES WERE INTIMATED ONLY AFTER 15 YEARS VIDE LETTER DATED 23.12.2009. IN THIS BACKGROUND, THE TRIBUNAL HAS EXAMINED THE ASPECTS A ND ALLOWED THE APPLICATION DIRECTING THE DIT TO GRANT REGISTRA TION. OBSERVATION OF THE TRIBUNAL IN PARA-9 IS WORTH TO N OTE. IT READS AS UNDER: 9. .. WE ALSO NOTE THAT THE ORIGINAL OBJECT OF TH E TRUST OF PROVIDING HOSTEL ACCOMMODATION TO THE STUDENTS HAS NOT BEEN DELETED. THE ABJECT HAS ONLY BEEN MODIFIED SO AS TO INCLUDE OTHER DESERVING STUDENTS ALSO IN ADDITION T O THE STUDENTS OF MODH COMMUNITY. THERE IS ONLY ONE ADDIT ION FEE IN THE OBJECTS WHICH IS PROVIDING MEDICAL AID TO T HE POOR AND DESERVING PERSONS OF ANY COMMUNITY. THUS EVEN THE AMENDED OBJECTS REMAIN CHARITABLE AND HAVE NOT CAUS ED ANY DETRIMENT TO THE ORIGINAL OBJECTS AS STUDENTS OF TH E MODH COMMUNITY CONTINUED TO BE ELIGIBLE FOR THE BENEFITS . FURTHER THE TRUST HAD ALREADY BEEN GRANTED EXEMPTION UNDER SECTION 80G BASED ON THE AMENDED OBJECTS FOR THE SUBSEQUE NT PERIOD. THERE IS NO STATUTORY REQUIREMENT OF INTIMATING THE CHANGES TO THE INCOME-TAX DEPARTMENT. THE REQUI REMENT OF INTIMATION IS MENTIONED ONLY IN THE FORM NO.10A AND EVEN IN THE FORM NO.10A THERE IS NO TIME LIMIT PRESCRIBE D. THE ASSESSEE HAS ALREADY INTIMATED THE CHANGES TO THE DEPARTMENT THOUGH LATER AND THEREFORE TECHNICALLY T HERE IS NO VIOLATION ON THE PART OF THE ASSESSEE BECAUSE OF NO TIME LIMIT BEING PRESCRIBED. MOREOVER, THERE BEING NO STATUTORY REQUIREMENT OF INTIMATING CHANGES, REGISTRATI ON CANNOT BE CANCELLED OR THE TRUST CANNOT BE DECLARED INVALI D ONLY ON THE GROUND THAT CHANGES WERE NOT INTIMATED. 16. THE NEXT CASE LAW REFERRED TO BY THE LD.COUNSEL FOR THE ASSESSEE IS OF HONBLE DELHI HIGH COURT IN THE CASE OF MOOLCHAND KHAIRATI RAM TRUST (SUPRA). HE PLACED ON RECORD CO PY OF THE DECISION. IT IS PERTINENT TO OBSERVE THAT THE LD.C OMMISSIONER HAS RELIED UPON ORDER OF THE ITAT IN THIS CASE. ONE OF US (JM) WAS ITA NO.3119/AHD/2014 15 PARTY TO THE ORDER PASSED BY THE ITAT, DELHI BENCH IN THE CASE OF MOOLCHAND KHAIRATI RAM TRUST. THE ISSUE IN THAT CA SE WAS THAT LATE LALA KHAIRATI RAM EXECUTED A WILL DATED 23-12- 1927 AND CODICIL DATED 8.1.1928. IN TERMS OF THE SAID WILL C ERTAIN PROPERTIES WERE SETTLED IN TRUST FOR FURTHERANCE OF THE OBJECT S AS SET OUT IN THE WILL. THE MAIN OBJECT WAS TO SET UP A HOSPITAL NAMED SHRI MOOL CHAND KHAIRATI RAM HOSPITAL AND AYURVEDIC RESE ARCH INSTITUTE IN LAHORE. AFTER PARTITION OF THE COUNTR Y IN 1947, THE ASSESSEE APPLIED FOR ALLOTMENT OF LAND TO THE GOVER NMENT OF INDIA, AND IN 1958 AN INSTITUTION WAS SET UP KNOWN AS SHR I MOOL CHAND KHAIRATI RAM HOSPITAL AND AYURVEDIC RESEARCH INSTIT UTE. THE ASSESSEE WAS GRANTED REGISTRATION UNDER SECTION 12A IN DECEMBER, 1974. IN THE ASSESSMENT YEAR 2006-07 IT WAS RAISED BY THE AO THAT THE TRUST WAS SETTLED FOR RUNNING AN AYURVEDIC HOSPITAL AND RESEARCH CENTRE, WHEREAS IT HAS STARTED RUNNING AN ALOPATHIC CENTRE WHICH IS NOT IN CONSONANCE WITH THE OBJECTS OF THE TRUST. HENCE, IT IS NOT ENTITLED FOR BENEFIT UNDER SECTION S 11 AND 12. ULTIMATELY, DISPUTE TRAVELLED UPTO THE HONBLE APEX COURT, AND THE HONBLE DELHI HIGH COURT HAS SET ASIDE ORDER OF THE ITAT AND HELD THAT RUNNING AN ALLOPATHIC HOSPITAL WOULD ALSO IN A WAY A MEDICAL RELIEF AND BOOST AYURVEDI SYSTEM IN HOSPITAL IN QUE STION, APART FROM CONSIDERING ACTIVITY OF RUNNING ALLOPATHY SYST EM OF MEDICINE IN CONSONANCE WITH OBJECTS OF THE TRUST. HONBLE H IGH COURT HAS FURTHER OBSERVED THAT ONCE THE DEPARTMENT HAS ALLOW ED THINGS TO SETTLE IN EARLIER YEARS, EVEN IF TWO OPINIONS ARE P OSSIBLE, THE AO SHOULD NOT HAVE UNSETTLED THE ISSUE, WHEN THERE ARE NO CHANGES IN THE FACTS AND CIRCUMSTANCES. WE WOULD LIKE TO TAKE NOTE OF THE FINDING OF THE HONBLE DELHI HIGH COURT ON THIS ASP ECT AS UNDER: ITA NO.3119/AHD/2014 16 39. THE NEXT ISSUE TO BE ADDRESSED IS WHETHER IT W AS OPEN FOR THE AO TO TAKE A VIEW DIFFERENT FROM THE ONE THAT HAS BEEN ACCEPTED BY THE REVENUE FOR THE PAST SEVERAL DECADE S. IT IS WELL ESTABLISHED THAT EACH YEAR IS A SEPARATE ASSES SMENT UNIT AND THE PRINCIPLES OF RES JUDICATA ARE NOT APPLICAB LE. HOWEVER, IN THIS CASE, IT WOULD BE APPROPRIATE TO NOTE THAT THE ACTIVITIES CARRIED OUT BY THE ASSESSEE HAVE BEEN ACCEPTED AS BE ING AMENABLE TO EXEMPTION UNDER SECTION 11 OF THE ACT FOR THE PAST SEVERAL DECADES. IN THE PAST PERIOD, THE ASSESSEE HA S BEEN GRANTED EXEMPTION UNDER SECTION 11 OF THE ACT AND ALSO UNDER SECTION 10(22) / 10(22A) OR SECTION 10(23C) OF THE ACT. CONCEDEDLY, THE EXEMPTIONS GRANTED TO THE ASSESSEE F OR PAST SEVERAL DECADES WOULD NOT BE AVAILABLE IF THE ACTIV ITIES OF THE ASSESSEE WERE CONSIDERED BY THE CONCERNED AOS/AUTHORIT IES TO BE ULTRA VIRES ITS OBJECTS. 40. IN THE CIRCUMSTANCES, IT WOULD NOT BE APPOSITE TO PERMIT THE REVENUE TO CHALLENGE A POSITION THAT HAS BEEN S USTAINED OVER SEVERAL DECADES WITHOUT THERE BEING ANY MATERI AL CHANGE. IN RADHASOAMI SATSANG (SUPRA), THE SUPREME COURT OB SERVED AS UNDER:- '....EACH ASSESSMENT YEAR BEING A UNIT, WHAT IS DEC IDED IN ONE YEAR MAY NOT APPLY IN THE FOLLOWING YEAR BUT WH ERE A FUNDAMENTAL ASPECT PERMEATING THROUGH THE DIFFERENT ASSESSMENT YEARS HAS BEEN FOUND AS A FACT ONE WAY O R THE OTHER AND PARTIES HAVE ALLOWED THAT POSITION TO BE SUSTAINED BY NOT CHALLENGING THE ORDER, IT WOULD NO T BE AT ALL APPROPRIATE TO ALLOW THE POSITION TO BE CHANGED IN A SUBSEQUENT YEAR..' 41. IN PARASHURAM POTTERY WORKS CO. LTD. V. ITO : (1977) 106 ITR 1 SC, THE SUPREME COURT REITERATED THE PRINCIPL E THAT IF THE PARTIES HAVE ALLOWED A POSITION TO SUSTAIN, IT WOUL D NOT BE APPROPRIATE TO CHANGE THE POSITION IN A SUBSEQUENT YEAR. THE SAID DECISIONS HAVE ALSO BEEN FOLLOWED BY THE SUPRE ME COURT IN ITS LATER DECISION IN EXCEL INDUSTRIES LTD. (SUPRA) . 42. IN KRISHAK BHARATI CO-OPERATIVE LTD. (SUPRA), A DIVISION BENCH OF THIS COURT STRUCK A NOTE OF CAUTION THAT TH E RULE OF CONSISTENCY IS NOT OF A WIDE APPLICATION AND A BLIN D ADHERENCE TO THIS RULE WOULD LEAD TO ANOMALOUS RESULTS. THUS, IN THE CIRCUMSTANCES, WHERE THE VIEWS ARE MISTAKEN AND APP ARENTLY ERRONEOUS, IT WOULD NOT BE APPOSITE TO COMPEL THE R EVENUE TO FOLLOW THE SAME ON THE PRINCIPLE OF ESTOPPEL OR OF CONSISTENCY. HOWEVER, IN CASES, WHERE TWO VIEWS ARE PLAUSIBLE, I T WOULD BE, ITA NO.3119/AHD/2014 17 PLAINLY, WHIMSICAL TO FRAME AN ASSESSMENT CONTRARY TO THE POSITION ACCEPTED IN EARLIER YEARS. THIS WOULD REND ER THE EXERCISE OF ASSESSMENT HIGHLY SUBJECTIVE; CLEARLY, AN ASSESSEE CANNOT BE SUBJECTED TO SUCH VAGARIES. INDISPUTABLY, THE POWERS OF AO ARE WIDE BUT ITS EXERCISE CANNOT BE UNDISCIPLI NED. IN CASES WHERE THERE IS A PALPABLE MISTAKE OR THE POSIT ION ACCEPTED BY THE REVENUE IN EARLIER YEARS IS APPAREN TLY ERRONEOUS, THE AO WOULD NOT BE BOUND TO ACCEPT THE V IEW OF HIS PREDECESSORS. HOWEVER, IN CASES - SUCH AS THE PRESE NT CASE - WHERE THE ASSESSEE'S CLAIM FOR EXEMPTION HAS BEEN A CCEPTED FOR SEVERAL DECADES, IT WOULD NOT BE OPEN FOR AO TO THINK OF NEW GROUNDS, WHICH AT BEST RAISE CONTENTIOUS ISSUES , TO CAST A WIDER NET OF TAX. IT IS TRITE LAW, THAT IF TWO VIEW S ARE POSSIBLE, THE ONE FAVORING THE ASSESSEE MUST BE ADOPTED. THIS RULE WOULD APPLY A FORTIORI IN CASES WHERE THE ASSESSEE'S CLAIM HAS BEEN CONSISTENTLY ACCEPTED BY THE REVENUE IN THE PA ST. THUS, IN CASES WHERE THE CLAIM OF AN ASSESSEE HAS BEEN ACC EPTED IN EARLIER YEARS, UNLESS THE CLAIM OF AN ASSESSEE IS FO UND TO BE DEVOID OF ANY BASIS OR PLAINLY CONTRARY TO LAW, IT WOULD NOT BE OPEN FOR THE AO TO TAKE A VIEW CONTRARY TO THE POSITI ON WHICH HAS BEEN ACCEPTED BY THE REVENUE IN EARLIER YEARS A ND HAS BEEN PERMITTED TO SUSTAIN FOR A SIGNIFICANT PERIOD OF TIME. 43. IN THE FACTS OF THE PRESENT CASE, IT IS NOT POS SIBLE TO ACCEPT THAT GRANT OF EXEMPTION TO THE ASSESSEE FOR THE PAS T SEVERAL DECADES WAS PALPABLY ERRONEOUS AND SUCCESSIVE AOS WE RE WRONG IN ACCEPTING THAT THE ACTIVITIES OF THE ASSESS EE WERE IN FURTHERANCE OF ITS CHARITABLE OBJECTS, ENTITLING TH E ASSESSEE TO ESCAPE THE LEVY OF INCOME TAX. 44. IN VIEW OF THE ABOVE, THE SECOND QUESTION IS AN SWERED IN AFFIRMATIVE AND ASSESSEE WOULD NOT BE ENTITLED TO EX EMPTION UNDER SECTION 11 OF THE ACT IF ITS ACTIVITIES ARE OUTSIDE THE SCOPE OF ITS OBJECTS, EVEN IF ITS ACTIVITIES ARE CH ARITABLE IN NATURE. HOWEVER, THE FIRST QUESTION IS ANSWERED IN THE NEGATIVE AND IN FAVOUR OF THE ASSESSEE AND IN OUR VIEW, THE T RIBUNAL WAS NOT JUSTIFIED IN ALLOWING THE REVENUE'S APPEAL AND DENYING THE ASSESSEE'S CLAIM UNDER SECTION 11 OF THE ACT. 17. THERE ARE OTHER DECISIONS RELIED UPON BY THE LD .COUNSEL FOR THE ASSESSEE, BUT WE DO NOT DEEM IT NECESSARY TO RE CITE AND RECAPITULATE THE PROPOSITION OF LAW CANVASSED IN TH OSE DECISIONS BECAUSE IT IS SUFFICE TO SAY THAT CORE OF THE DECIS IONS IS TO THE ITA NO.3119/AHD/2014 18 EFFECT THAT IF AMENDED OBJECTS OF THE TRUSTS ARE NO T NON-GENUINE AND CHARITABLE IN NATURE, THEN MERE FAILURE ON THE PART OF THE ASSESSEE TO INTIMATE THIS AMENDED OBJECTS TO THE DE PARTMENT WOULD NOT GOAD THE LD.COMMISSIONER TO CANCEL REGIST RATION. IT IS AN IRREGULARITY WHICH COULD BE RECTIFIED. IN THE L IGHT OF THE ABOVE, LET US EXAMINE THE FACTS OF THE PRESENT CASE. AS OBSERVED EARLIER, OBJECTS OF THE ASSESSEE WERE CONSTRUED AS GENUINE A ND CHARITABLE. IT WAS GRANTED REGISTRATION UNDER SECTION 12A. BY W AY OF AMENDMENT CARRIED OUT IN APRIL, 1990 IT HAS INCLUDE D ONE MORE OBJECTS WHICH AUTHORISE IT TO ESTABLISH DIAGNOSTIC CENTRE FOR ADVANCING MEDICAL RELIEF TO THE NEEDY. THIS OBJECT IS ALSO PER SE CHARITABLE. THE LD.COMMISSIONER HAS NOT RECORDED A NY ADVERSE FINDING QUA THIS OBJECT. HE HAS MADE REFERENCE AT TWO-THREE PLACES THAT IT WAS A COMMERCIAL VENTURE, BUT HOW ES TABLISHING OF DIAGNOSTIC CENTRE IS NOT TO BE CONSTRUED AS A MEDIC AL RELIEF TO THE PUBLIC AND HOW IT WILL AUTOMATICALLY BECOME A COMME RCIAL VENTURE IS NOT DISERNABLE. IT IS PERTINENT TO OBSERVE THAT IN CLAUSE 8 AND 9 OF THE ORIGINAL TRUST DEED, THE ASSESSEE IS HAVING OBJECTS TO GRANT RELIEF IN ANY FORM TO DISABLED AND POOR AND ALSO TO GRANT SUBSCRIPTION AND DONATION TO THE HOSPITALS AND DISP ENSARIES. THUS, IN ITS ORIGINAL OBJECTS, THE ASSESSEE WAS HAVING CE RTAIN OBJECTS OF PROVIDING RELIEF TO THE POOR. IT CAN BE IN THE FOR M OF FINANCE, MEDIAL, EDUCATION ETC. THUS, ESTABLISHMENT OF A D IAGNOSTIC CENTER IS IN THE LINE OR COHERENT TO ITS EXISTING OBJECTS. IT IS NOT SOMETHING ALIEN OR SOME DIFFERENT ACTIVITIES HAVE B EEN STARTED, WHICH WOULD DISENTITLE IT FOR GETTING REGISTRATION UNDER SECTION 12AA OF THE ACT. AS FAR AS NON-COMMUNICATION OF A MENDED TRUST DEED TO THE DEPARTMENT IN FORM NO.10A OF THE ACT IS CONCERNED, IN THE CASE OF MEHTA JIVRAJ (SUPRA) ITAT MUMBAI HAS HE LD THAT THERE ITA NO.3119/AHD/2014 19 IS NO REQUIREMENT IN THE ACT FOR FURNISHING THE AME NDED DEED; IT IS BEING CONTEMPLATED IN THE CLAUSE OF FORM NO.10A UND ER RULES, THUS WORST-TO-WORST IT COULD BE AN IRREGULARITY. WE FI ND THAT CHANGES WERE DULY NOTIFIED AND RECORDED IN THE REGISTER OF PUBLIC TRUST MAINTAINED BY THE OFFICE OF CHARITY COMMISSIONER. THE ASSESSEE WAS ENJOYING REGISTRATION UNDER SECTION 80G SINCE 1 977. IT HAD APPLIED FOR RENEWAL OF 80G IN FORM NO.10A ON 31.3.1 991. IT IS MANDATORY TO FILE FOLLOWING DOCUMENTS ALONG WITH AP PLICATION FOR GRANT OF REGISTRATION UNDER SECTION 80G VIZ. (A) CO PY OF INCOME TAX REGISTRATION CERTIFICATE, (B) TRUST DEED, DETAI LS OF ACTIVITIES SINCE ITS INCEPTION OR LAST THREE YEARS WHICHEVER I S LESS, (C) COPY OF AUDITED ACCOUNTS OF THE INSTITUTION SINCE ITS INCEP TION OR LAST THREE YEARS WHICHEVER IS LESS. THUS, AT THE FIRST AVAILA BLE OCCASION, IT HAS SUPPLIED AMENDED TRUST DEED TO THE DEPARTMENT. THEREAFTER, TIME AND AGAIN RENEWAL OF 80G REGISTRATION WAS GRAN TED TO IT AND EVERY TIME IT HAS FILED TRUST DEED. ASSESSMENT OF THE ASSESSEE HAS BEEN FRAMED UNDER SCRUTINY MORE PARTICULAR ASSESSME NTS FOR THE A.Y.2003-04, 2005-06 AND 2006-07. THEY WERE PASSED UNDER SECTION 143(3). ORDERS FOR THE ASSTT.YEAR 2005-06 AND 2006-07 ARE AVAILABLE ON PAGE NO.199 AND 219 OF THE PAPER B OOK. IT MEANS THAT THE AO MUST HAVE GONE THROUGH ALL THE RE CORDS. HE MUST HAVE SEEN THE INCOME FROM THE DIAGNOSTIC CENTR E. ESTABLISHING OF A DIAGNOSTIC CENTER WAS IN THE KNOW LEDGE OF THE DEPARTMENT. IMPLIEDLY INTIMATION WAS GIVEN TO IT. THE DEPARTMENT DID NOT CHANGE STATUS OF THE ASSESSEE CO NTINUOUSLY FOR MORE THAN 20 YEARS. IT HAS ACCEPTED THE STATUS OF THE ASSESSEE AS CHARITABLE INSTITUTION. THERE IS NO CHANGE IN THE FACTS AND CIRCUMSTANCES OF THE ASSESSEE-TRUST THROUGH THESE T WENTY YEARS WHICH CAN AUTHORISE THE LD.COMMISSIONER TO CALL FOR DETAILS AND ITA NO.3119/AHD/2014 20 BRAND ACTIVITIES OF THE ASSESSEE AS NON-GENUINE OR NOT IN ACCORDANCE WITH OBJECTS OF THE ASSESSEE. THUS, IN OUR OPINION, JUDGMENT OF THE HONBLE DELHI HIGH COURT IN THE CAS E OF MOOLCHAND KHAIRATI RAM TRUST (SUPRA) IS DULY APPLICABLE ON TH E FACTS OF PRESENT CASE. AS FAR AS JUDGMENT OF THE ITAT, RELI ED UPON BY THE LD.COMMISSIONER I.E. IN THE CASE OF MOOLCHAND KHAIR ATI RAM TRUST, THIS DECISION HAS BEEN REVERSED BY THE DELHI HIGH C OURT. OTHER DECISIONS CONSIDERED BY THE LD.COMMISSIONER I.E. IT AT, JAIPUR BENCH AND OF ALLAHABAD HIGH COURT HAVE BEEN CONSIDER ED BY THE ITAT MUMBAI BENCHES. WE HAVE TAKEN INTO CONSIDERATI ON THIS ASPECT AND FACTS IN THESE CASES ARE DISTINGUISHABLE . ON DUE CONSIDERATION OF THE ABOVE FACTS AND CIRCUMSTANCES, WE ARE OF THE VIEW THAT ORDER OF THE LD.COMMISSIONER IS NOT SUSTA INABLE. IT IS SET ASIDE. REGISTRATION GRANTED TO THE ASSESSEE UNDER SECTION 12A IS RESTORED. 18. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWE D. ORDER PRONOUNCED IN THE COURT ON 27 TH FEBRUARY, 2018. SD/- SD/- (PRAMOD KUMAR) ACCOUNTANT MEMBER (RAJPAL YADAV) JUDICIAL MEMBER