Acharya Pravnanand Vishwaneed Nyas, Dehradun V. CIT, Dehradun

ITA 3754/DEL/2011

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 58786 (ITAT-DELHI)
• Duration Of Justice: 6 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-02-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 15-02-2012
• Assessment Year: misc
• Appeal Filed On: 04-08-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: V K SAKSENA
• Keywords: Charitable institution
• Section: 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH A DELHI) BEFORE SHRI G.D. AGRAWAL, HONBLE VICE PRESIDENT AND SHRI A.D. JAIN, JUDICIAL MEMBER ITA NO. 3754(DEL)2011 ASSESSMENT YEAR: ACHARYA PRAVNANAND VISHWANEED NYAS COMMISSION ER OF INCOME TAX, C/O MATTA GARG & CO., 15, ASTLEY HALL, V. 13, SU BHASH ROAD, DEHRADUN. DEHRADUN. (APPELLANT) (RESPONDENT) APPELLANT BY: NONE RESPONDENT BY : SHRI V.K. SAKSENA, CIT/DR ORDER PER A.D. JAIN, J.M . THIS IS ASSESSEES APPEAL AGAINST THE ORDER DATED 2 4.06.2011 PASSED BY THE LEARNED CIT U/S 12AA(1)(B)(II) OF THE I.T. ACT, URGING THAT THE LEARNED CIT(A) HAS ERRED IN REJECTING THE APPLICATION FOR R EGISTRATION U/S 12AA(A) OF THE ACT. 2. AT THE TIME OF HEARING, NONE APPEARED ON BEHALF OF THE ASSESSEE. HOWEVER, AN APPLICATION HAS BEEN RECEIVED ALONG WIT H A PAPER BOOK. IN THE APPLICATION IT HAS BEEN, INTER ALIA, CONTENDED THAT THE ASSESSEE INSTITUTION IS A VERY SMALL INSTITUTION WITH A VERY MEAGER FINANCIAL MEANS, UNABLE TO BEAR THE ITA 3754(DEL)2011 2 FEES AND EXPENSES OF THE REPRESENTATION BEFORE THE TRIBUNAL. IT HAS BEEN REQUESTED TO CONSIDER THE SUBMISSIONS MADE IN THE A PPLICATION. 3. THE ASSESSEE HAS CONTENDED IN THE APPLICATION TH AT THE ASSESSEE TRUST WAS CREATED ON 3.12.09 BY SHRI DHANANJAY (ACHARYA) , DISCIPLE OF SHRI ACHARYA HARIDEV. VIDE TRUST DEED DATED 3.12.09, REGISTERED IN THE OFFICE OF THE SUB-REGISTRAR, DEHRADUN ON 04.12.2009; THAT A SUPPLEMENTARY TRUST DEED WAS EXECUTED ON 13.01.2010, WHICH WAS ALSO DUL Y REGISTERED IN THE OFFICE OF THE SUB-REGISTRAR, DEHRADUN ON 13.1.2010; THAT THE OBJECTIVES OF THE ASSESSEE TRUST CONTAINED IN THE SUPPLEMENTARY T RUST DEED ARE AS FOLLOWS:- A) EDUCATION B) HEALTH C) WOMEN AND CHILD WELFARE D) SOCIAL AND ECONOMIC REFORMS E) LEGAL AWARENESS F) VILLAGE DEVELOPMENT, AGRICULTURE AND ENVIRONMENT AN D G) MISCELLANEOUS. IT HAS FURTHER BEEN CONTENDED THAT ALL THE ABOVE OB JECTIVES ARE CHARITABLE IN NATURE AND ARE COVERED WITHIN THE MEANING OF CHAR ITY AS GIVEN IN SECTION 2(15) OF THE ACT; THAT WHILE REJECTING THE APPLICAT ION FOR REGISTRATION U/S 12A(A) OF THE ACT, FILED BY THE ASSESSEE ON 02.12. 2010, THE ONLY BASIS TAKEN BY THE LEARNED CIT WAS THAT THE INCOME MAY BE APPLI ED OUTSIDE INDIA, WHICH IS NOT PERMITTED U/S 11 OF THE I.T. ACT; THAT THE S UPPLEMENTARY TRUST DEED, IN ITA 3754(DEL)2011 3 PARA 2 (B) PROVIDES THAT THE BRANCHES OF THE ASSESS EE TRUST CAN BE IN INDIA AND/OR OUTSIDE INDIA; THAT ACCORDING TO PARA 2(C) O F THE SUPPLEMENTARY TRUST DEED, THE AREA OF OPERATION WILL BE INDIA AND THE E NTIRE WORLD; THAT IT IS FROM THESE TWO CLAUSES CONTAINED IN THE SUPPLEMENTARY TR UST DEED THAT THE LD. CIT HAS PRESUMED THAT THE ASSESSEE TRUST IS GOING T O APPLY ITS INCOME OUTSIDE INDIA; THAT AS PER THE LAW, ACCORDING TO BE ELIGIBLE FOR REGISTRATION U/S 12A(A) OF THE ACT, THE OBJECTIVES OF THE INSTITUTIO N MUST BE CHARITABLE WITHIN THE MEANING OF SECTION 2(15) OF THE ACT; THAT THE L D. CIT HAS ACCEPTED THAT THE OBJECTIVES OF THE ASSESSEE TRUST ARE CHARITABLE IN NATURE, AS HE HAS NOT RAISED ANY OBJECTION IN THIS REGARD; THAT MERELY SI NCE THE AREA OF OPERATION OF THE ASSESSEE TRUST IS THE ENTIRE WORLD AND IT CAN O PEN BRANCH ANYWHERE IN THE WORLD, IT DOES NOT IMPLY THAT THE INSTITUTION IS NO T ELIGIBLE FOR EXEMPTION U/S 12A(A) OF THE ACT; THAT THE LD. CIT HAS WRONGLY PR ESUMED THAT THE INSTITUTION WOULD BE APPLYING ITS INCOME OUTSIDE INDIA; THAT SE CTION 11(1)(A) OF THE ACT CLEARLY PROVIDES THAT INCOME APPLYING OUTSIDE INDIA WILL NOT BE ELIGIBLE FOR EXEMPTION, BUT IT NO-WHERE STATES THAT THE INSTITUT ION ITSELF WOULD BECOME INELIGIBLE FOR EXEMPTION U/S 12A(A) OF THE ACT IF T HE INCOME IS APPLIED OUTSIDE INDIA; AND THAT THE PROVISIONS OF SECTION 1 2A(A) OF THE ACT HAVE BEEN WRONGLY INTERPRETED BY THE LD. CIT WHILE REJECTING THE APPLICATION OF THE ASSESSEE TRUST. ITA 3754(DEL)2011 4 4. BEFORE US, THE LD. DR HAS CONTENDED THAT BEFORE THE LD. CIT, THE ASSESSEE HAD MADE A REQUEST THAT IT WOULD AMEND THE RELEVANT CLAUSE OF THE TRUST DEED; THAT IF THIS BE SO, AND THE ASSESSEE DOES BRING ABOUT SUCH AN AMENDMENT, THE MATTER MAY BE RE-DECIDED BY THE LD. CIT. 5. WE HAVE HEARD THE LD. DR AND HAVE PERUSED THE MA TERIAL ON RECORD. THE LD. CIT, AT PAGE 3 OF THE IMPUGNED ORDER, HAS R EPRODUCED THE ASSESSEES REPLY TO THE SHOW CAUSE NOTICE DATED 17.6.01, AS FO LLOWS:- 1. PROVISION OF SECTION 11(1) ARE VERY CLEAR INASM UCH AS THAT INCOME APPLIED FOR CHARITABLE PURPOSE IN INDIA WOULD BE EL IGIBLE FOR EXEMPTION; 2. THE SAID PROVISION NOWHERE DEBARS OR DISQUALIFI ES AN INSTITUTION WHO HAS PLANS TO OPEN AN OFFICE OUTSIDE INDIA AND/O R APPLIES ITS INCOME OUTSIDE INDIA; 3. THE APPLICANT ALSO REFERRED THE CASE LAW 50 DTR 243(KAR) DIT(E) V. MEENAKSHI AMMA ENDOWMENT TRUST [2011] IN SUPPO RT OF HIS CLAIM; AND 4. THE APPLICANT ALSO AGREES TO AMEND THE RELEVANT CLAUSE OF THE TRUST DEED AND AGREES TO APPLY ENTIRE INCOME WITHIN INDIA . 6. ITEM 4 ABOVE SHOWS THAT INDEED, BEFORE THE LD. C IT, THE ASSESSEE HAD AGREED, IN WRITING, TO AMEND THE RELEVANT CLAUSE OF THE TRUST DEED. AS SUCH, THE CONTENTION OF THE LD. DR IS CORRECT. ITA 3754(DEL)2011 5 7. ACCORDINGLY, THE MATTER IS REMITTED TO THE FILE OF THE LD. CIT TO DECIDE IT AFRESH ON CONSIDERING THE AMENDED RELEVANT CLAUS E OF THE TRUST DEED, IF SO AMENDED BY THE ASSESSEE TRUST. 8. IN THE RESULT, FOR STATISTICAL PURPOSES, THE APP EAL OF THE ASSESSEE IS TREATED AS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 29.02.2012. SD/- SD/- (G.D. AGRAWAL) (A.D. JAIN) VICE PRESIDENT JUDICIAL MEMBER DATED: 29.02.2012 *RM COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR TRUE COPY BY ORDER ASSISTANT REGISTRAR