MATUSHRI JAVERBEN SHIVAJI SHAH CHARITABLE TRUST, MUMBAI V. DIT (E), MUMBAI

ITA 3124/MUM/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 92434 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-04-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 22-04-2015
• Assessment Year: 2012-2013
• Appeal Filed On: 23-04-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S J SINGH
• Assessee Lawyers: V P KOTHARI
• Keywords: Charitable institution
• Section: 12A

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL E BENCH, MUMBAI BEFORE S/SHRI B.R.BASKARAN (AM) AND AMIT SHUKLA, (JM) . . , , ./ I.T.A. NO. 3124 / MUM/20 1 3 ( / ASSESSMENT YEAR : 2012 - 13) MATUSHRI JAVERBEN SHIVJI SHAH CHARITABLE TRUST, M/S MEHTA KOTHARI AND CO., CAS, 17, SWASTIK SOCIETY ROAD NO.2, JVPD SCHEME, VILE PARLE (W), MUMBAI - 400056 / VS. DIRECTOR OF INCOM E TAX (EXEMPTION),6 TH FLOOR, PIRAMAL CHAMBER S , L OWER PAREL, MUMBAI - 400013 ( / APPELLANT ) .. ( / RESPONDENT ) ./ ./PAN/GIR NO. : AADTM4032F / A SSESSEES BY SHRI V P KOTHARI / RE VENUE BY SHRI S J SINGH / DATE OF HEARING : 2 2 .4. 201 5 / DATE OF PRONOUNCEMENT : 24. 4 . 201 5 / O R D E R PER B.R. BASKARAN (AM) THE ASSESSEE HAS FILED THIS APPEAL CHALLENGING BY THE DECISION OF LD DIT IN REJECTING THE APPLICATION FILED BY THE ASSESSEE SEEKING REGISTRATION U/S 12A OF THE ACT. 2. THE LD A.R SUBMITTED THAT THE ASSESSEE HAD FILED APPLICATION SEEKING REGISTRATION U/S 12A OF THE ACT IN THE PRESCRIBED FORM ON 21.08.2012. HOWEVER, THE LD DIT REJECTED THE APPLICATION ON THE FOLLOWING GROUNDS: - (A) THE TRUST DEED DID NOT HAVE DISSOLUTION CLAUSE. ITA NO. 3124 / MUM/201 3 2 (B) THE ASSESSEE HAS NOT CARRIED OUT ANY ACTIVITIES. THE LD A.R SUBMITTED THAT THE PROVISIONS OF BOMBAY PU BLIC TRUSTS ACT, 1950 ARE APPLICABLE TO THE ASSESSEE, SINCE IT IS REGISTERED WITH THE CHARITY COMMISSION. FURTHER AS PER THE PROVISIONS OF THE ABOVE SAID ACT, THE NET ASSETS SHALL BE GIVEN TO ANOTHER TRUST HAVING SIMILAR OBJECTS AND UNDER NO CIRCUMSTANCES THEY CANNOT BE DISTRIBUTED AMONGST THE TRUSTEES. HE SUBMITTED THAT THE ABOVE SAID PROVISION IS BINDING UPON THE ASSESSEE TRUST AND HENCE THERE WAS NO REQUIREMENT FOR THE ASSESSEE TO HAVE THE DISSOLUTION CLAUSE. WITH REGARD TO THE ACTIVITIES, THE LD A.R SUBMITTED THAT THE TRUST WAS CREATED ON 18.7.2011 AND IT WAS IN ITS INCEPTION STAGE AT THE RELEVANT POINT OF TIME. HE SUBMITTED THAT THE ASSESSEE HAS BEEN CARRYING ON ACTIVITIES THEREAFTER AND IN ANY CASE, IT CANNOT BE A GROUND FOR REJECTING THE APPLICATI ON. 3. THE LD CIT(DR) STRONGLY DEFENDED THE ORDER PASSED BY LD DIT. 4. ON A PERUSAL OF THE ORDER PASSED BY LD DIT, WE NOTICE THAT THE LD DIT DID NOT STATE AS TO HOW THE PROVISIONS OF BOMBAY PUBLIC TRUSTS ACT IS NOT APPLICABLE TO THE ASSESSEE. WE HAVE N OTICED THAT THE ASSESSEE HAS SUBMITTED THAT THE PROVISIONS RELATING TO DISSOLUTION OF TRUSTS AS PROVIDED IN BOMBAY PUBLIC TRUSTS ACT ARE BINDING UPON THE ASSESSEE. HOWEVER, THIS CONTENTION HAS NOT BEEN EXAMINED BY LD CIT. FURTHER, IF THE LD DIT FELT THAT THE SAID PROVISIONS ARE NOT BINDING, THEN HE COULD HAVE GIVEN AN OPPORTUNITY TO THE ASSESSEE TO AMEND THE TRUST DEED. NO SUCH ACTION HAS BEEN TAKEN. WITH REGARD TO THE ACTIVITIES, THE LD A.R SUBMITTED THAT THE ASSESSEE TRUST HAS STARTED CARRYING ON ACTI VITIES. IN VIEW OF THE ABOVE, WE ARE OF THE VIEW THAT THE ASSESSEE SHOULD BE GIVEN ONE MORE OPPORTUNITY. ACCORDINGLY, WE SET ASIDE THE ORDER OF LD DIT AND RESTORE THE MATTER TO HIS FILE WITH THE DIRECTION TO EXAMINE THE APPLICATION FILED BY THE AFRESH IN THE LIGHT OF DISCUSSIONS MADE SUPRA. ITA NO. 3124 / MUM/201 3 3 5. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES. THE AB OVE ORDER WAS PRONOUNCED IN THE OPEN COURT ON 24TH APR , 2015 . 24TH APR , 2015 SD SD ( / AMIT SHUKLA ) ( . . / B.R. BASKARAN) / JUDICIA L MEMBER / ACCOUNTANT MEMBER MUMBAI: 24TH APR ,2015 . . . ./ SRL , SR. PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE C IT(A) - CONCERNED 4. / CIT CONCERNED 5. , , / DR, ITAT, MUMBAI CONCERNED 6. / GUARD FILE. / BY ORDER, TRUE COPY (ASSTT. REGISTRAR) , /ITAT, MUMBAI