Unity Welfare Trust, Navsari V. Pr. CIT(Exemption), Ahmedabad

ITA 318/SRT/2017

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 5418 (ITAT-SURAT)
• Duration Of Justice: 3 year(s) 9 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-09-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: misc
• Appeal Filed On: 05-12-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S T BIDARI
• Keywords: Charitable institution; Set aside
• Section: 12AA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, SURAT BENCH, SURAT BEFORE SHRI PAWAN SINGH, JUDICIAL MEMBER AND DR. ARJUN LAL SAINI, ACCOUNTANT MEMBER ITA NO. 318/SRT/2017 (H EARING IN VIRTUAL COURT) UNITY WELFARE TRUST, HOUSE NO.1859, MAYAT STREET AT&P.O. ALIPORE, TA: CHIKHLI, DIST. NAVSARI-396521 PAN : AAATU 6683 K VS PRINCIPAL COMMISSIONER OF INCOME TAX (EXEMPTIONS), 1 ST FLOOR, ROOM NO.111- 112, ANNEXY, AAYKAR BHAVAN, ASHRAM ROAD, AHMEDABAD ASSESSEE / APPELLANT REVENUE /RESPONDENT ASSESSEE BY SHRI AKSHAY M. MODI, C.A REVENUE BY SHRI S.T. BIDARI CIT-DR DATE OF HEARING 2 1 .0 9 .2021 DATE OF PRONOUNCEMENT 23.09.2021 ORDER UNDER SECTION 254(1) OF INCOME TAX ACT PER PAWAN SINGH, JUDICIAL MEMBER : 1. THIS APPEAL BY ASSESSEE IS DIRECTED AGAINST THE ORDER OF LD. PRINCIPAL COMMISSIONER OF INCOME TAX (EXEMPTIONS), AHMEDABAD [PCIT(E)] FOR SHORT) DATED 28.09.2017 PASSED UNDER SECTION 12AA OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT). THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL:- (1) THE LEARNED PR. CIT(EXEMPTIONS),AHMEDABADS ORDER IS CONTRADICTORY TO LAW AND FACTS OF THE CASE AND HENCE, LIABLE TO BE QUASHED. (2) THE LEARNED PR. CIT (EXEMPTIONS), AHMEDABAD HAS ERRED IN DENYING FOR REGISTRATION U/S 12AA OF THE ACT WITHOUT CONSIDERING ON MERITS THE DOCUMENTARY EVIDENCES/EXPLANATIONS FURNISHED BEFORE HIM TO SATISFY HIMSELF ABOUT THE OBJECTS AND GENUINENESS OF THE CHARITABLE AND PUBLIC ACTIVITIES CARRIED OUT TOWARDS THE OBJECTS OF THE T4UST BY THE APPELLANT TRUST AND HENCE, THE PR. CITS ACTION IN ITA NO.318/SRT/2017 UNITY WELFARE TRUST 2 REFUSING FOR REGISTRATION IS ARBITRARY, WITHOUT JURISDICTION, BAD IN LAW AND NOT JUSTIFIED. 2. BRIEF FACTS OF THE CASE ARE THAT ASSESSEE IS A CHARITABLE TRUST. THE ASSESSEE FILED APPLICATION FOR SEEKING REGISTRATION UNDER SECTION 12AA OF THE ACT IN PRESCRIBED FORM ON 20.03.2017.THE LD. PCIT(E) ON RECEIPT OF APPLICATION ISSUED NOTICE TO THE ASSESSEE TO FURNISH DETAIL NOTE OF THE ACTIVITIES ACTUALLY CARRIED OUT BY THE ASSESSEE-TRUST ALONG WITH DOCUMENTS. THE DETAILS DOCUMENTS REQUIRED BY LD. PCIT(E) IS MENTIONED IN PARA-2 OF ITS ORDER. THE ASSESSEE-TRUST FURNISHED ITS PART REPLY ON 26.05.2017.THE LD. PCIT(E) RECORDED THAT THE ASSESSEE NEITHER FILED REPLY NOR ATTENDED THE OFFICE NOR SIGHT ADJOURNMENT AND THAT THE ASSESSEE MADE PART COMPLIANCE. ACCORDINGLY, LD. PCIT(E) ISSUED FINAL SHOW-CAUSE NOTICE FOR GIVING ONE MORE OPPORTUNITY VIDE NOTICE DATED 01.8.2017. THE ASSESSEE REPLIED VIDE ITS REPLY RECEIVED 29.08.2017. THE PCIT(E) RECORDED THAT ASSESSEE NOT FURNISHED DETAILS OF RECEIPTS AND PAYMENTS AS REFLECTED IN THE BANK STATEMENT. FURTHER THE ACTIVITIES OF THE ASSESSEE IS NOT GENUINE AS THERE IS LARGE CASH DEPOSITS AND THE SAME IS IMMEDIATELY TRANSFERRED TO ONE MEHUL C SHAH AND AMEE/ VESU REFRIGERATION AND THAT THE CAMP PICTURE ARE NOT OF HN HOSPITAL. THE LD PCIT(E) HELD THAT THE ASSESSEE FAILED TO FURNISH REQUIRED DETAILS. THEREFORE HE PROCEEDED TO DECIDE APPLICATION ON THE MATERIALS AVAILABLE ON RECORD. 3. THE LD. PCIT(E) RECORDED THAT NEITHER THE ASSESSEE CARRIED OUT ANY CHARITABLE ACTIVITY NOR ESTABLISHED CORPUS TO UNDERTAKE THE CHARITABLE ACTIVITIES, WHICH ITA NO.318/SRT/2017 UNITY WELFARE TRUST 3 CLEARLY INDICATE THAT THE ASSESSEE DOES NOT HAVE INTENTION TO START CHARITABLE ACTIVITIES. THE LD. PCIT(E) REJECTED THE APPLICATION BY TAKING THE VIEW THAT ASSESSEE HAS FAILED TO FILED DOCUMENTARY EVIDENCE TO SATISFY ABOUT THE GENUINENESS OF ACTIVITIES IN CONSONANCE WITH ITS OBJECT IN ITS ORDER DATED 28.09.2017. THUS, AGGRIEVED BY THE ORDER OF LD. PCIT(E) ASSESSEE HAS FILED PRESENT APPEAL BEFORE US. 4. WE HAVE HEARD THE SUBMISSION OF LD. AUTHORIZED REPRESENTATIVE (AR) FOR THE ASSESSEE AND LD. COMMISSIONER OF INCOME TAX -DEPARTMENTAL REPRESENTATIVE (CIT-DR) FOR REVENUE. THE LD. AR OF THE ASSESSEE SUBMITS THAT WHILE FILING APPLICATION UNDER SECTION 12AA ON 20.03.2017 THE ASSESSEE FURNISH COMPLETE DETAILS AS REQUIRED UNDER FORM 10A R.W.S. RULE 11AA OF INCOME TAX RULES- 1962.THE ASSESSEE EXPLAINED ITS OBJECT FOR PROVIDING RELIEF IN MEDICAL TO POOR AND FREE MEDICAL CAMP FOR GENERAL CHECK-UP. THE ASSESSEE WAS RECEIVED NOTICE DATED 03.05.2017. IN RESPONSE TO SAID NOTICE, THE ASSESSEE FURNISHED ITS REPLY DATED 29.08.2017. THE COPY OF REPLY FILED BY THE ASSESSEE DULY NOTED BY LD. PCIT(E) RECEIVED ON 26.05.2017. THE ASSESSEE AGAIN FURNISHED COMPLETE DETAILS AS REQUIRED BY LD. PCIT(E). LD. AR OF THE ASSESSEE FURTHER SUBMITS THAT ANOTHER NOTICE DATED 01.08.2017 WAS RECEIVED BY ASSESSEE AND ASSESSEE VIDE ITS REPLY DATED 29.08.2017 SUBMITTED THAT THEY HAVE ALREADY FILED REPLY AND DETAILS ON 08.03.2017 AND AGAIN ON 11.05.2017.THE LD. AR OF THE ASSESSEE SUBMITS THAT THE ITA NO.318/SRT/2017 UNITY WELFARE TRUST 4 LD. PCIT(E) REJECTED THE APPLICATION OF ASSESSEE FOR WANT OF DOCUMENTARY EVIDENCE. THE LD. AR FOR THE ASSESSEE SUBMITS THAT ASSESSEE HAS A GOOD CASE ON MERIT AND IN CASE ONE MORE OPPORTUNITY IS GIVEN TO FURNISH FURTHER DOCUMENTARY EVIDENCE TO PROVE THE GENUINENESS OF ACTIVITIES AND CHARITABLE OBJECT, THE ASSESSEE MAY SUCCEED. THE ASSESSEE UNDERTAKE TO FURNISH COMPLETE DETAILS OF THE ACTIVITIES UNDERTAKEN IN FURTHERANCE OF ITS OBJECT. THE LD. AR OF THE ASSESSEE REITERATES THAT ALL DESIRED DOCUMENTS WERE FURNISHED AND THERE ARE READY TO FURNISH AND EXPLAINS THE FACT BEFORE LD. PCIT(E). 5. TO SUPPORT HIS CONTENTION, LD. AR OF THE ASSESSEE RELIED UPON THE DECISION OF ITAT AHMEDABAD BENCHES IN THE CASE OF PANCHKUVA CLOTH MERCHANT ASSOCIATION VS. CIT (EXEMPTION), AHMEDABAD [2021] 128 TAXMANN.COM 391 (AHMEDABAD-TRIB.), WHEREIN THE TRIBUNAL HAS HELD THE ORDER OF CIT (E) DENYING APPLICATION UNDER SECTION 12AA ON GROUND THAT ASSESSEE FAILED TO FILE DOCUMENTARY EVIDENCES SO AS TO SATISFY HIM ABOUT GENUINENESS OF ITS CREATION AND ITS ACTIVITIES TO BE SET ASIDE IF DOCUMENTS FILED BY ASSESSEE IN THIS REGARD WERE NOT VERIFIED BY HIM . 6. ON THE OTHER HAND, LD. CIT-DR FOR THE REVENUE SUPPORTED THE ORDER OF LD. PCIT(E). LD. CIT-DR SUBMITS THAT LD. PCIT(E) HELD IN PARA-4 TO 6 THAT IMPUGNED ORDER CLEARLY HELD THAT ASSESSEE FAILED TO FURNISH REQUISITE DETAILS, THE LD. PCIT(E) PASSED THE IMPUGNED ORDER ON THE BASIS OF MATERIAL AVAILABLE ON ITA NO.318/SRT/2017 UNITY WELFARE TRUST 5 RECORD. THE ASSESSEE HAS NOT CARRIED OUT ANY CHARITABLE ACTIVITY NOR ESTABLISH FOR THE PURPOSE TO UNDERTAKE THE CHARITABLE ACTIVITY. IT IS CLEARLY HELD THAT ASSESSEE- TRUST HAS NO INTENTION TO START CHARITABLE OR RELIGIOUS ACTIVITY AND IN ABSENCE OF ANY DOCUMENTARY EVIDENCE, LD. PCIT(E) WAS NOT SATISFIED HIMSELF ABOUT THE GENUINENESS OF ACTIVITIES IN CONSONANCE WITH ITS OBJECT. 7. WE HAVE CONSIDERED THE RIVAL SUBMISSION OF BOTH THE PARTIES AND PERUSED THE MATERIAL AVAILABLE AND ORDER OF LD. PCIT(E). WE HAVE ALSO SEEN VARIOUS DOCUMENTARY EVIDENCE FILED BY ASSESSEE-TRUST ALONGWITH APPEAL MEMO. WE MAY NOTE THAT DOCUMENTS FILED ALONGWITH APPEAL MEMO IS NOT IN CONSONANCE WITH INCOME TAX TRIBUNAL RULE, 1963. THE ASSESSEE-TRUST WAS REQUIRED TO FILE DOCUMENT WITH SEPARATE LIST OF DOCUMENTS WITH A CERTIFICATE CERTIFYING THAT THESE DOCUMENTS WERE FURNISHED BEFORE THE LOWER AUTHORITIES. HOWEVER, WE INSTEAD OF GOING INTO SUCH TECHNICALITY FIND THAT ASSESSEE WAS FILED APPLICATION UNDER SECTION 12AA AND FURNISHED REQUIRED DETAILS ALONGWITH APPLIACTION. THE ASSESSEE-TRUST AGAIN IN RESPONSE TO SHOW CAUSE NOTICE FILED ITS REPLY ON REPLY DATED 23.05.2017. THE REPLY OF ASSESSEE IS DULY ACKNOWLEDGED BY LD. PCIT(E) IN ITS ORDER. WE FIND THAT THE ASSESSEE INSTEAD OF FILING DETAIL EXPLANATORY SUBMISSION RELIED ON VARIOUS DOCUMENTS FURNISHED ALONGWITH ORIGINAL APPLICATION. THE LD. PCIT(E) AGAIN ISSUED FINAL SHOW CAUSE NOTICE DATED 01.08.2017 SEEKING VARIOUS DETAILS AS MENTIONED THEREIN. THE ASSESSEE INSTEAD OF ITA NO.318/SRT/2017 UNITY WELFARE TRUST 6 GIVING PARA-WISE REPLY FILED AS SHORT AND CRYPTIC REPLY DATED 26.08.2017, WHICH WAS RECEIVED BY LD. PCIT(E) ON 29.08.2017. THE LD. PCIT(E) REJECTED THE APPLICATION OF ASSESSEE BY TAKING VIEW THAT ASSESSEE-TRUST FAILED TO FILE DOCUMENTARY EVIDENCE ABOUT THE GENUINENESS OF ACTIVITIES IN CONSONANCE WITH OBJECT. CONSIDERING THE FACT THAT THE ASSESSEE-TRUST HAS FURNISHED ALMOST OR REQUISITE DETAIL VIDE REPLY DATED 26.05.2017, THE LD. PCIT(E) INSTEAD OF REFERRING ALL THOSE DOCUMENTARY EVIDENCE REJECTED THE APPLICATION OF THE ASSESSEE-TRUST. THEREFORE, WE DEEM IT APPROPRIATE TO SET ASIDE THE IMPUGNED ORDER OF LD. PCIT(E) AND RESTORE THE MATER BACK TO THE FILE OF LD. PCIT(E) FOR CONSIDERING THE APPLICATION AFRESH AND PASS ORDER IN ACCORDANCE WITH LAW. THE ASSESSEE IS ALSO DIRECTED TO PROVIDE COMPLETE DETAIL WITH EXPLANATORY NOTE AND EXPLAIN ALL THE FACTS TO SUBSTANTIATE THE GENUINENESS OF ACTIVITIES IN ACCORDANCE WITH ITS OBJECTS. 8. IN THE RESULT, APPEAL OF ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED ON 23/09/2021 BY PLACING THE RESULT ON THE NOTICE BOARD. SD/- SD/- ( DR ARJUN LAL SAINI) (PAWAN SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER SURAT, DATED: 23/09/2021 DKP. OUT SOURCING SR.P.S ITA NO.318/SRT/2017 UNITY WELFARE TRUST 7 COPY TO: 1. APPELLANT-UNITY WELFARE TRUST, HOUSE NO.1859, MAYAT STREET, AT&P.O.: ALIPORE, TA: CHIKHLI, DIST. NAVSARI-396521 2. RESPONDENT- PCIT(EX) 1 ST FL. ROOM NO.111-112, ANNEXY, AAYKAR BHAVAN, ASHRAM ROAD AHMEDABAD 3. CIT(A)- 4. CIT 5. DR 6. GUARD FILE TRUE COPY/ BY ORDER / / TRUE COPY / / ASSISTANT REGISTRAR, ITAT, SURAT