Shri Sthanakwasi Jain Sangh-Jodhpur, Ahmedabad V. The Director of Income tax(Exemption), Ahmedabad

ITA 3242/AHD/2011

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 60540 (ITAT-AHMEDABAD)
• Duration Of Justice: 5 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-06-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 06-06-2012
• Assessment Year: misc
• Appeal Filed On: 23-12-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Charitable institution
• Section: 12; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD B BENCH AHMEDABAD BEFORE SHRI D.K.TYAGI , JUDICIAL MEMBER AND SHRI T.R. MEENA, ACCOUNTANT MEMBER ITA NO. 3242/AHD/2011 SHRI STHANAKWASI JAIN SANGH - JODHPUR V/S . DIRECTOR OF INCOME TAX (EXEMPTION), AHMEDABAD PAN NO. AA JT98751M (APPELLANT) .. (RESPONDENT) BY APPELLANT MS. URVASHI SHODHAN, A.R. /BY RESPONDENT MS. SURBHI SHARMA, SR. D.R. /DATE OF HEARING 06.06.2012 /DATE OF PRONOUNCEMENT 22.06.2012 O R D E R PER : T.R.MEENA, ACCOUNTANT MEMBER THIS IS AN APPEAL AT THE BEHEST OF THE ASSESSEE WHI CH HAS EMANATED FROM THE ORDER OF DIT (EXM.), AHMEDABAD, ORDER DATED 23.11.2 011 FOR REJECTION OF APPLICATION FOR REGISTRATION U/S 12AA(1)(B)(II) OF THE IT ACT. 2. THE ASSESSEE HAD APPLIED FOR REGISTRATION U/S 12 A OF THE IT ACT IN FORM NO.10A ALONG WITH THE CERTIFICATE OF REGISTRATION B Y THE DY. CHARITY COMMISSIONER OF AHMEDABAD AND COPY OF THE TRUST DEE D. THE LD. DIT (EXM.), AHMEDABAD, ASKED TO FURNISH THE INFORMATION ABOUT THE ACTUAL ACTIVITY ITA NO. 3242/AHD/2011 PAGE 2 OF THE TRUST SINCE ITS INCEPTION ON 11.09.2011 IN T ERMS OF RULE 11AA(2)(II) OF THE INCOME TAX RULES. THE ASSESSEE SUBMITTED THE I NFORMATION AND CLAIMED THAT TRUST WAS CREATED TO CARRY ON CHARITABLE ACTIV ITIES OF HUMANITARIAN NATURE AS WELL AS RELIGIOUS ACTIVITIES SUPPORTING JAIN REL IGION AND SPENT RS. 1,67,859/- ON DIFFERENT RELATED ACTIVITIES FOR THIS PURPOSE. HE ALSO VERIFIED AND CONCLUDED THAT IT COULD SUPPORT THE ACTIVITY OF AN SPECIFIC S ECT OF JAIN RELIGION NAMELY STHANAKVASI JAIN OF DARIAPURI SECT. IT IS FURTHER RESTRICTED TO AATHKOTI DARIAPURI SECT. IT IS AN ASSOCIATION OF THE MEMBERS WHICH IS RESTRICTED TO THE FOLLOWERS OF THIS SECT WITHIN A CERTAIN GEOGRAPHICAL AREA. FINA LLY, HE OBSERVED THAT THE BENEFIT OF SECTION 11 AND 12 CANNOT BE EXTENDED TO THE CASE WHERE THE TRUST WAS CREATED OR ESTABLISHED FOR THE BENEFIT OF ANY P ARTICULAR RELIGIOUS COMMUNITY OR CASTE U/S 13(1)(B). THUS, HE REJECTED THE REGISTRATION APPLICATION U/S 12AA(1)(B)(II) OF THE IT ACT. 3. THE ASSESSEE IS IN APPEAL BEFORE US. THE LD. CO UNSEL FOR THE ASSESSEE FILED PAPER BOOK ALONG WITH COPY OF BANK ACCOUNT AN D COPY OF LETTER DATED 15.11.2011 ADDRESSED TO DIT(EXM.), AHMEDABAD AND LE ARNED COUNSEL HAS DRAWN OUR ATTENTION TO CONSTITUTION OF THE TRUST TH AT WHO CAN BE MEMBER OF THE SANGH, WAY OF THE CONTRIBUTION TO THE FUND, WHAT IS GEOGRAPHICAL AREA OF ACTIVITY OF THE SANGH, OTHER CONDITIONS OF THE TRUS T DEED. IT IS FURTHER CLAIMED THAT DURING YEAR UNDER CONSIDERATION I.E. FINANCIAL YEAR 11-12 THE TRUST HAS INCURRED THE EXPENDITURE OF RS.1,67,859/- WHICH INC LUDES DHARMA KARNI EXPENSES - 9,060.00, JIVDAYA EXPENSES- 67,636.00, PRABHAVNA EXPENSES- 72,290.00, KITCHEN EXPENSES-10,792.00, OTHER HELP- 7,941.00, VAIYAVACH ITA NO. 3242/AHD/2011 PAGE 3 EXPENSES- 140 AND CLAIMED THAT THIS TRUST IS FOR PO OR PERSON OF ALL COMMUNITIES AND PROVIDED MEDICAL HELP FOR ANIMALS A ND BIRDS AND THE OBJECTS OF THE TRUST IS RELIGIOUS AS WELL AS CHARITABLE. S HE FURTHER REFERRED THE CASE OF AHMEDABAD C BENCH IN CASE OF SHIYA DAWOODI BOHRA JAMAT V. CIT-III, BARODA, [2011] 15 TAXMANN.COM 154 (AHD.) IN WHICH THE TRUST WAS CREATED FOR DAWOODI BOHRA COMMUNITY AND THE BENEFIT OF THE TRUS T WAS AVAILABLE TO A SECTION OF PEOPLE AND WAS NOT CONFINED TO SOME SPE CIFIED INDIVIDUALS. THE TRIBUNAL HELD THAT THIS TRUST WAS NOT ESTABLISHED FOR PRIVATE RELIGIOUS PURPOSE. SHE FURTHER DRAW OUR ATTENTION OF HYDERABAD ITAT B BENCH DECISION OF REHBOTH MISSION V. DIT(EXM.), HYDERABAD [2010] 42 S OT 149 (HYD.) IN WHICH ITAT, HYDERABAD HAS HELD THAT SECTION 13(1)(B) DOES NOT SUGGEST THAT AN INSTITUTION OF MIXED OBJECTS IS PRECLUDED FROM GETT ING REGISTRATION UNDER SECTION 12AA. THE OTHER CASE HAS BEEN REFERRED BY HER I.E. AHMEDABAD RANA CASTE ASSOCIATION V. CIT 82 ITR 704 (SC), CHANDRA CHARITA BLE TRUST (294 ITR 86 & DIT(EXM.) V. SHETH JIVANDA GODIDAS SHANKHESHWAR IN TAX APPEAL NO. 909 OF 2012 (GUJARAT HIGH COURT) AND PRAYED THAT DIT (EXM.), AHMEDABAD, IS DIRECTED TO GRANT THE REGISTRATION OF THE TRUST. 4. FROM THE REVENUE SIDE, MS. SURBHI SHARMA, SR. D. R. VEHEMENTLY CONTENDED THAT THE OBJECT, THE AREA AND BENEFIT OF THE TRUST ARE LIMITED TO PARTICULAR OR JAIN SECT EVEN NOT OTHER SECT OF THE JAIN COMMUNITY AND THE OBJECTS OF THE TRUST ARE NOT PUBLIC AT LARGE AND TH E DIT(EXM.) HAS RIGHTLY REJECTED THE REGISTRATION. ITA NO. 3242/AHD/2011 PAGE 4 5. WE HAVE PERUSED THE REJECTION ORDER, SUBMISSION MADE BY LD. A.R. FOR THE ASSESSEE, ARGUMENTS OF BOTH THE SIDES AND GONE THROUGH THE DETAILS OF THE EXPENSES. IT APPEARS FROM THE DETAILS THAT PARTLY EXPENSES ARE FOR SPECIAL SECT OF THE JAIN COMMUNITY BUT SOME OF THE HEADS OF THE EXPENDITURE SHOWS THAT THEY PROVIDE EDUCATION TO THE POOR AND INCLUDING TH E EXPENDITURE ON TREATMENT OF ANIMALS AND BIRDS AND ALSO PROVIDING FOOD FOR TH E POOR. THEREFORE, DIT (EXM.) IS DIRECTED TO VERIFY THESE ITEMS WHETHER TH ESE WERE INCURRED FOR OTHER COMMUNITY OR PUBLIC AT LARGE AND DECIDE THE MATTER ACCORDINGLY. IF THE EXPENDITURE UNDER ABOVE HEADS ARE FOUND TO INCUR ON PUBLIC AT LARGE THEN IT IS A CASE OF RELIGIOUS AS WELL AS CHARITABLE TRUST WHI CH HAS MIXED OBJECT. ACCORDINGLY, GRANT REGISTRATION U/S 12AA(1)(B)(II) OF THE IT ACT. 6. IN THE RESULT, THE ASSESSEES APPEAL IS ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN OPEN COURT ON THE DATE MENTIONE D HEREINABOVE AT CAPTION PAGE. SD/- SD/- ( D.K.TYAGI ) (T.R. MEENA) JUDICIAL MEMBER ACCOUNTANT MEMBER TRUE COPY S.K.SINHA ! ! ! ! '! '! '! '! / COPY OF ORDER FORWARDED TO:- 1. / APPELLANT 2. / RESPONDENT 3. '(' ) * / CONCERNED CIT 4. *- / CIT (A) 5. !./ ), ) , 12( / DR, ITAT, AHMEDABAD 6. /45 67 / GUARD FILE. BY ORDER/ , ITA NO. 3242/AHD/2011 PAGE 5 8/ 1 ': ) , 12( ; STRENGTHEN PREPARATION & DELIVERY OF ORDERS IN THE ITAT 1) DATE OF TAKING DICTATION 14.06.2012 2) DIRECT DICTATION BY MEMBER STRAIGHT ON COMPUTER/LAPTOP/DRAGON DICTATE XXX 3) DATE OF TYPING & DRAFT ORDER PLACE BEFORE MEMBER 15.06.2012 4) DATE OF CORRECTION ,, ,, 5) DATE OF FURTHER CORRECTION 6) DATE OF INITIAL SIGN BY MEMBERS 7) ORDER UPLOADED ON 8) ORIGINAL DICTATION PAD HAS BEEN ENCLOSED IN THIS FILE 9) FINAL ORDER AND 2 ND COPY SEND TO BENCH CLERK ON