SNEHA & SANNA FOUNDATION, MUMBAI V. DIT (E), MUMBAI

ITA 3892/MUM/2013

• Counselvise Citation: 389219914 RSA 2013
• Duration Of Justice: 2 year(s) 2 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-08-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Next Hearing Date: 09-07-2015
• Assessment Year: 2013-2014
• Appeal Filed On: 16-05-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MANJUNATHA SWAMY
• Assessee Lawyers: A H DALAL
• Keywords: Charitable institution
• Section: 12A; 12AA; 11

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL E , BENCH MUMBAI . . , , BEFORE SHRI R.C.SHARMA , A M & SHRI SANJAY GARG , J M ./ ITA NO . 3892 / MUM/20 1 3 ( / ASSESSMENT YEAR : ) SNEHA & S ANNA FOUNDATION, G - 15, PRASAD CHAMBERS, OPERA HOUSE, MUMBAI - 400004 VS. DIT(E), MUMBAI - 400019 ./ ./ PAN/GIR NO. : A A LTS 8805 N ( / APPELLANT ) .. ( / RESPONDENT ) /ASSESSEE BY : SHRI A.H.DALAL /REVENUE BY : MS.MANJUNATHA SWAMY / DATE OF HEARING : 09 / 0 7 / 2015 / DATE OF PRONOUNCEMENT 12 / 08 /2015 / O R D E R PER R.C.SHARMA (A.M) : TH IS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF DIT(EXEMPTIONS), MUMBAI, PASSED U/S.12AA(1)(B)(II) R.W.S12A OF THE I.T.ACT. 2. RIVAL CONTENTIONS HAVE BEEN HEARD AND RECORD PERUSED. FACTS IN BRIEF ARE THAT THE ASSE SSEE HAS FILED AN APPLICATION FOR REGISTRATION U/S.12A OF THE ACT IN THE PRESCRIBED FORM NO. 10A ON 24.09.2012. THE TRUST HAS BEEN CONSTITUTED BY A TRUST DEED DATED 10 - 12 - 2010. IT WAS REGISTERED WITH THE CHARITY COMMISSIONER, MUMBAI ON 19 - 5 - 2012. THE DIT(E) REJECTED THE REGISTRATION ON THE PLEA THAT CLAUSE REGARDING DISSOLUTION OF ITA NO. 3892 /1 3 2 TRUST WAS NOT THERE IN THE TRUST DEED. AGAINST THE ORDER OF DIT(E), THE ASSESSEE IS IN FURTHER APPEAL BEFORE US. 3. WE HAVE CONSIDERED RIVAL CONTENTIONS AND FOUND THAT ISSUE WITH R EGARD TO ABSENCE OF DISSOLUTION CLAUSE IN THE TRUST DEED HAS BEEN DULY CONSIDERED WHILE GRANTING REGISTRATION U/S 12A, IS SQUARELY COVERED BY THE VARIOUS DECISION OF CO - ORDINATE BENCH WHICH ARE AS UNDER : - I) ITA NO.71/AHD/2013(SITARAM KUTIR CHARITABLE TRU ST); II) ITA NO.1247/MUM/2013(TARA EDUCATIONAL & CHARITABLE TRUST); III) ITA NO.4537/DEL/2009(SUKRAM CHARITABLE TRUST); IV) ITA NO.4509/MUM/2013(RAMA RASHMI CHHAGANLAL WAGHWALA CHARITABLE TRUST); V) ITA NO.382/RJT)2013(SHRI KALA VARDHAN EDUCATION TRUST); VI) ITA NO.3566/MUM/2013 (GEETA LALWANI FOUNDATION). IN THE CASE OF TARA EDUCATION & CHARITABLE TRUST , ITA NO.1247/MUM/2013, ORDER DATED 14 - 7 - 2014 , THE TRIBUNAL HELD AS UNDER : - 4. WE HAVE HEARD THE ARGUMENTS OF BOTH THE SIDES AND ALSO PERUSED THE RELE VANT MATERIAL AVAILABLE ON RECORD. IT IS OBSERVED THAT THE APPLICATION FILED BY THE ASSESSEE U/S 12 A OF THE ACT HAS BEEN REJECTED BY THE LD. DIT (EXEMPTIONS) MAINLY ON THE GROUND THAT THE RELEVANT TRUST DEED DOES NOT CONTAIN THE SO - CALLED 'DISSOLUTION CLAUSE'. AS PER THE PROVISIONS OF SECTION 11 & 12 OF THE ACT, INCOME DERIVED FROM PROPERTY HELD FOR CH ARITABLE OR RELIGIOUS PURPOSES AND INCOME OF TRUSTS OR INSTITUTIONS FROM CONTRIBUTIONS ARE EXEMPT FROM TAX PROVIDED SUCH TRUSTS OR INSTITUTIONS ARE REGISTERED U/S 12 A OF THE ACT . THE PROCEDURE FOR REGIST RATION U/S 12A IS PRESCRIBED IN SECTION 12AA OF THE ACT WHICH PROVIDES THAT THE COMMISSIONER, ON THE RECEIPT OF AN APPLICATION FOR REGISTRATION OF A TRUST OR INSTITUTION MADE U/S 12A, SHALL CALL FOR SUCH INFORMATION FROM THE TRUST/INSTITUTION AS HE THINKS NECESSARY IN ORDER TO SATISFY HIMSELF ABOUT THE GENUINENESS OF ACTIVITIES OF THE TRUST/INSTITUTION AND MAY ALSO MAKE SUCH INQUIRIES AS DEEMED NECESSARY ON THIS BEHALF. IT FURTHER PROVIDES THAT AFTER SATIS FYING HIMSELF ABOUT THE OBJECTS OF THE TRUST/INSTITUTION AND THE GENUINENESS OF ITS ACTIVITIES, THE COMMISSIONER SHALL PASS AN ORDER IN WRITING REGISTERING THE TRUST/INSTITUTION U/S 12A AND IF HE IS NOT SO SATISFIED, HE SHALL PASS AN ORDER IN WRITING REFUS ING TO REGISTER THE TRUST/INSTITUTION. THE SCOPE OF ENQUIRY CONTEMPLATED U/S 12AA OF THE ACT THUS IS LIMITED TO THE EXTENT OF COMMISSIONER GETTING HIMSELF SATISFIED ABOUT OBJECT OF THE TRUST AND THE GENUINENESS OF ITS ACTIVITIES SO AS TO GRANT OR REFUSE TH E REGISTRATION U/S 12 A OF THE ACT . A PERUSAL OF THE IMPUGNED ITA NO. 3892 /1 3 3 ORDER OF THE LD. DIT (EXEMPTIONS), HOWEVER, SHOWS THAT HE HAS NOT RECORDED ANY ADVERSE COMMENT OR DIS - SATISFACTION ABOUT THE OBJECT OF THE TRU ST OR GENUINENESS OF THE TRUST ACTIVITIES. HE HAS REFUSED TO GRANT THE REGISTRATION U/S 12 A OF THE ACT ON THE GROUND THAT ITS TRUST DEED DOES NOT CONTAIN 'DISSOLUTION CLAUSE'. IN OUR OPINION, THE LD. DIT (EXEMPTIONS) THUS HAS CLEARLY GONE BEYOND THE SCOPE OF ENQUIRY CONTEMPLATED U/S 12 A OF THE ACT AND HAS REFUSED TO GRANT THE REGISTRATION U/S 12 A OF TH E ACT TO THE ASSESSEE TRUST ON A TOTALLY IRRELEVANT GROUND WITHOUT POINTING OUT AS TO HOW HE WAS NOT SATISFIED EITHER ABOUT THE OBJECT OF THE TRUST OR THE GENUINENESS OF ITS ACTIVITIES. WE THEREFORE SET ASIDE THE IMPUGNED ORDER OF THE LD. DIT (EXEMPTIONS) AND DIRECT THAT THE REGISTRATION U/S 12 A OF THE ACT AS APPLIED BY THE ASSESSEE TRUST BE GRANTED. 4. RESPECTFULLY FOLLOWING THE DECISION OF THE COORDINATE BENCH, WE DO NOT FIND ANY MERIT IN THE ORDER P ASSED BY THE DIT(E) , INSOFAR AS MERE ABSENCE OF DISSOLUTION CLAUSE IN THE TRUST DEED, CANNOT BE MADE THE GROUND FOR REFUSAL OF THE REGISTRATION U/S.12A WHEN THE OBJECT OF THE TRUST WAS CHARITABLE IN NATURE, GENUINENESS OF WHICH WAS NOT DOUBTED BY THE DIT( E). 5 IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED. O RDER PRONOUNCED IN THE OPEN COURT ON THIS 12 / 08 / 201 5 . SD/ - ( ) ( SANJAY GARG ) SD/ - ( . . ) ( R.C.SHARMA ) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI ; DATED 12 / 08 /201 5 . . /PKM , . / PS / COPY OF THE ORDER FORWARDED TO : / BY ORDER, / ( ASSTT. REGISTRAR) , / ITAT, MUMBAI 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A), MUMBAI. 4. / CIT 5. , , / DR, ITAT, MUMBAI 6 . / GUARD FILE. //TRUE COPY//