M/s. Shiv Educational Society, Panipat V. CIT, Karnal

ITA 4605/DEL/2014

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 6959 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 11 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-07-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Assessment Year: misc
• Appeal Filed On: 21-08-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: K JEWANI
• Assessee Lawyers: K L ANEJA ITP
• Keywords: Gift
• Section: 12A; 12AA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH G, NEW DELHI BEFORE SH. G.D. AGRAWAL, PRESIDENT AND SH. SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER ITA NO.4605/DEL/2014 (ASSESSMENT YEAR: .) SHIV EDUCATIONAL SOCIETY V& P.O. DEHRA SEMALKHA PANIPAT PAN : AAGTS4906F VS. CIT KARNAL APPELLANT RESPONDENT ASSESSEE BY : SH. K.L.ANEJA, ITP REVENUE BY : SH. K.JEWANI, SR.DR DATE OF HEARING : 19.07.2018 DATE OF PRONOUNCEMENT : 31.07.2018 O R D E R PER SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER : THIS APPEAL IS PREFERRED BY THE ASSESSEE AGAINST O RDER DATED 28.07.2014 PASSED BY THE LD. COMMISSIONER OF INCOME TAX, KARNAL WHEREIN VIDE THE IMPUGNED ORDER THE LD. CIT HAS REFU SED GRANT OF REGISTRATION TO THE ASSESSEE SOCIETY U/S 12A OF THE INCOME TAX ACT, 1961 (HEREINAFTER CALLED AS THE ACT). 2 ITA NO.4605/DEL/14 (SHIV EDUCATIONAL SOCIETY) 2. THE ASSESSEE HAD FILED APPLICATION FOR REGISTRAT ION U/S 12AA OF THE ACT AND THE ASSESSEE WAS REQUIRED TO FURNISH CE RTAIN DOCUMENTS BY THE LD. CIT. THEREAFTER, AFTER PERUSING THE DOCU MENTS FILED, THE LD. CIT OPINED THAT THE ASSESSEE COULD NOT SPECIFY AS TO WHAT KIND OF EDUCATION THE TEACHERS WERE EXPECTED TO IMPART. THE LD. CIT ALSO NOTED THAT IN THE DISSOLUTION CLAUSE IT WAS NOTED TH AT THE PROPERTY OF THE SOCIETY WAS TO BE HANDED OVER TO OTHER TRUST /S HAVING SIMILAR AIMS AND OBJECTIVES IN THE EVENT OF DISSOLUTION. TH E LD. CIT ALSO NOTED THAT THE SOCIETY HAD EXECUTED A GIFT DEED ON 01.06.2012 AND TRANSFERRED A CERTAIN PIECE OF LAND TO MODERN COLL EGE OF EDUCATION FOR A NOTIONAL CONSIDERATION OF RS. 8,56,250/-. THE LD. CIT WAS OF THE OPINION THAT THE ASSET HAD BEEN TRANSFERRED WITH OUT ANY CONSIDERATION IN FORM OF THE GIFT. APART FROM THIS, THE LD. CIT HAD ALSO CALLED FOR A REPORT FROM THE ASSESSING OFFICER REGARDING THE ACTIVITIES OF THE ASSESSEE SOCIETY AND THE ASSESSIN G OFFICER HAD REPORTED THAT THE ACTIVITIES OF THE ASSESSEE SOCIET Y WERE NOT IN ACCORDANCE WITH THE OBJECTS IN THE MEMORANDUM OF ASS OCIATION. THE LD. CIT ALSO NOTED THAT IN ASSESSMENT YEARS 201 1-12, 2012-13 AND 2013-14, INTEREST FREE ADVANCES HAD BEEN GIVEN TO MEMBERS OF THE SOCIETY WHICH WAS IN VIOLATION OF PROVISIONS OF S ECTION 13 OF THE 3 ITA NO.4605/DEL/14 (SHIV EDUCATIONAL SOCIETY) ACT. THE LD. CIT PROCEEDED TO REFUSE THE BENEFIT OF REGISTRATION U/S 12A TO THE ASSESSEE SOCIETY. 3. BOTH THE PARTIES ARGUED AT LENGTH. 4. HAVING HEARD THE LD. COUNSEL AS WELL AS THE LD. CIT DR ON THE ISSUE, WE NOTE THAT MODERN COLLEGE OF EDUCATION IS PART OF THE ASSESSEE SOCIETY AND THE SOCIETY RUNS THIS COLLEGE. THIS FACT IS DULY MENTIONED IN THE ASSESSMENT ORDER FOR ASSESSMENT YE AR 2013-14. THEREFORE, IT CANNOT BE SAID THAT THE SOCIETY HAS T RANSFERRED ITS ASSET TO SOME OTHER ENTITY WITHOUT CONSIDERATION. IT IS ALSO SEEN THAT THE ASSESSEE SOCIETY HAS ADVANCED LESS THAN 5% OF I TS GROSS RECEIPTS TO ITS MEMBERS AND THE SAME IS EVIDENT FROM THE CHA RT FILED BEFORE US AND AVAILABLE ON PAPER BOOK PAGE 5 WHEREIN THE GR OSS RECEIPTS FOR ASSESSMENT YEARS 2011-12, 2012-13 AND 2013-14 A RE INDICATED. THUS, THE PROVISIONS OF SECTION 13 OF THE ACT DO NO T STAND VIOLATED. WE ALSO NOTE THAT THE LD. CIT HAS REFUSED REGISTRAT ION ON THE GROUND THAT THE GENUINENESS OF THE ACTIVITIES WOULD NOT BE SATISFACTORILY PROVED BY THE ASSESSEE. WE HAVE PERU SED THE MEMORANDUM OF OBJECTIVES OF THE ASSESSEE SOCIETY AN D NOTE THAT THE LD. CIT HAS NOT GIVEN ANY SPECIFIC FINDING REGA RDING THE NON- GENUINENESS ACTIVITIES OF THE TRUST VIS--VIS THE O BJECTIVES AS 4 ITA NO.4605/DEL/14 (SHIV EDUCATIONAL SOCIETY) MENTIONED IN THE MEMORANDUM OF ASSOCIATION BUT HAS RATHER RELIED ON THE REPORT OF THE ASSESSING OFFICER IN THIS REGA RD. ON THE FACTS OF THE CASE AND AFTER DULY CONSIDERING THE AVERMENTS O F BOTH THE PARTIES, IT IS OUR CONSIDERED OPINION THAT THE MATT ER SHOULD BE RE- EXAMINED BY THE LD. CIT. ACCORDINGLY, WE RESTORE THE ISSUE TO THE OFFICE OF THE LD. CIT WITH THE DIRECTION TO RECONSID ER THE ASSESSEES APPLICATION, KEEPING IN MIND OUR OBSERVATIONS IN TH E PRECEDING PARAGRAPHS AND PASS APPROPRIATE ORDER AS PER LAW AFT ER GIVING DUE OPPORTUNITY TO THE ASSESSEE. 5. IN THE FINAL RESULT, THE APPEAL OF THE ASSESSEE STANDS ALLOWED FOR STATISTICAL PURPOSES. (ORDER PRONOUNCED IN THE OPEN COURT ON 31 ST JULY, 2018). SD/- SD/- (G.D.AGARWAL) (SUDHANSHU SRIVASTAVA ) PRESIDENT JUDICIAL MEMBER DATE: 31.07.2018 BINITA COPY OF ORDER TO: - 1) THE APPELLANT; 2) THE RESPONDENT; 3) THE CIT; 4) THE CIT(A)-, NEW DELHI; 5) THE DR, I.T.A.T., NEW DELHI; TRUE COPY 5 ITA NO.4605/DEL/14 (SHIV EDUCATIONAL SOCIETY) BY ORDER ITAT, NEW DELHI