Madrasa Building Trust, Banaskantha V. The Director of Income tax (Exemp.), Ahmedabad

ITA 478/AHD/2013

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 67659 (ITAT-AHMEDABAD)
• Duration Of Justice: 6 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-09-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 02-09-2013
• Assessment Year: misc
• Appeal Filed On: 21-02-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VIMLENDRA VERMA
• Assessee Lawyers: M G PATEL
• Keywords: Condonation of delay
• Section: 12AA

Judgement Text

, , , , C, IN THE INCOME TAX APPELLATE TRIBUNAL AT AHMEDABAD, C BENCH . .. . . .. . , !' !' !' !', , , , #$ #$ #$ #$ %& %& %& %& , , , , &' &' &' &' ( & ' ( & ' ( & ' ( & ' BEFORE S/SHRI G.C. GUPTA, VICE-PRESIDENT AND TEJ RAM MEENA, ACCOUNTANT MEMBER) ITA NO.478/AHD/2013 MADRASA BUILDING TRUST AT. CHHAPI, TAL. VADGAM BANASKANTHA 385 210. PAN : AAATM 6748 H. /VS. DIRECTOR OF INCOME TAX (EXEMPTION), AHMEDABAD. ITA NO.479/AHD/2013 MADRASA ISLAMIYA DARUL ULOOM AT. CHHAPI, TAL. VADGAM BANASKANTHA 385 210. PAN : AAATM 9393 G. /VS. DIRECTOR OF INCOME TAX (EXEMPTION), AHMEDABAD. ( (( (*+ *+ *+ *+ / APPELLANT) ( (( (,-*+ ,-*+ ,-*+ ,-*+ / RESPONDENT) .% / 0 &/ ASSESSEE BY : SHRI M.G. PATEL ( / 0 &/ REVENUE BY : SHRI VIMLENDRA VERMA, CIT-DR 2 / %3'/ DATE OF HEARING : 2 ND SEPTEMBER, 2013. 456 / %3'/ DATE OF PRONOUNCEMENT : 5.9.2013 &7 / O R D E R PER G.C. GUPTA, VICE-PRESIDENT: THESE APPEALS BY THE ASSESSEES ARE DIRECTED AGAINST THE ORDER OF THE DIR ECTOR OF INCOME TAX ITA NO.478 AND 479/AHD/2013 -2 (EXEMPTIONS), AHMEDABAD, BARODA DATED 31.10.2012. SINCE IDENTICAL ISSUE IS INVOLVED IN BOTH THESE APPEALS, THESE ARE BEING DISPOSED OF WITH THIS CONSOLIDATED ORDER. 2. THERE IS DELAY OF 51 DAYS IN FILING THE PRESENT APPEALS BEFORE THE TRIBUNAL. THE ASSESSEE HAS FILED CONDONATION APPLI CATION SUPPORTED BY AFFIDAVIT OF MR. ABDUL K.N. CHOUDHARY, ALSO A TR USTEE OF THE ASSESSEE, ALONG WITH COPY OF HIS PASSPORT AND DEATH CERTIFICATE OF SMT. AISHA ABDUL KHALIK CHOUDHARY AND MEDICAL CERTIFICAT E. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE MANAGIN G TRUSTEE, SHRI ABDUL K.N. CHOUDHARY HAS LEFT INDIA ON 14.10.2012 F OR HAJ PILGRIMAGE PRIOR TO RECEIPT OF ORDER OF THE DIT(EXE MPTION), AHMEDABAD. HOWEVER, DUE TO CERTAIN SERIOUS ILLNESS OF HIS WIFE, HE HAD TO CUT SHORT HOLY TOUR AND RETURNED TO BOMBAY O N 14.11.2012. UNFORTUNATELY, HIS WIFE DID NOT SURVIVE AND EXPIRED ON 4.12.2012, AND DUE TO SHOCK OF DEATH OF HIS WIFE, ETC. AND THE MAN AGING TRUSTEE BEING A DIABETIC PATIENT, HAS TO BE HOSPITALIZED ON 9.12. 2012, AND WAS DISCHARGED FROM THE HOSPITAL ON 14.02.2013 ONLY. A FTER BEING DISCHARGED FROM THE HOSPITAL, HE TOOK STEPS TO FILE THE APPEALS AGAINST THE ORDER REJECTING THE REGISTRATION AND APPEALS WE RE FILED ON 21.2.2013. THE LEARNED DR HAS OPPOSED THE SUBMISSI ONS OF THE LEARNED COUNSEL OF THE ASSESSEE. WE HAVE CONSIDERE D RIVAL SUBMISSIONS REGARDING THE ISSUE OF CONDONATION OF D ELAY IN FILING THE PRESENT APPEALS BEFORE THE TRIBUNAL. IN THE FACTS AND CIRCUMSTANCES OF THE CASE, AS NARRATED BY THE LEARNED COUNSEL FOR TH E ASSESSEE AND SUPPORTED BY COPY OF PASSPORT OF THE MANAGING TRUST EE, SHRI ABDUL K.N. CHOUDHARY, SUPPORTED BY DEATH CERTIFICATE OF H IS WIFE AND MEDICAL CERTIFICATE OF HIS ILLNESS, WE HOLD THAT IT IS A FIT CASE FOR ITA NO.478 AND 479/AHD/2013 -3 CONDONATION OF DELAY IN FILING PRESENT APPEALS BEFO RE THE TRIBUNAL, AND WE DIRECT ACCORDINGLY. 3. IDENTICAL GROUNDS OF THE APPEALS OF THE ASSESSEE S IN BOTH THE APPEALS ARE AS UNDER: 1. THE LD.DIT(EXEMPTION) HAS ERRED IN LAW AS WELL AS ON FACTS OF THE CASE IN REJECTING THE APPLICATION FILE D BY THE APPELLANT FOR REGISTRATION U/S.12AA(1)(B)(II) OF TH E I.T.ACT, 1961 ON THE GROUND THAT HE IS NOT SATISFIED ABOUT THE GE NUINENESS OF THE ACTIVITIES OF THE APPELLANT. 2. THE APPELLANT HUMBLY SUBMITS THAT THE DIRECTOR O F INCOME TAX (EXEMPTIONS), AHMEDABAD BE DIRECTED TO G RANT REGISTRATION U/S.12AA OF THE I.T.ACT, 1961 TO THE A PPELLANT. 4. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED T HAT THE ASSESSEE-TRUSTS WERE REGISTERED WITH CHARITY COMMIS SIONER ON 11.12.1954 AND ITS OBJECTIVES ARE VERY MUCH CHARITA BLE/RELIGIOUS IN NATURE, WHICH QUALIFIES FOR REGISTRATION UNDER SECT ION 12AA OF THE ACT. HE SUBMITTED THAT REASONING OF THE DIT(EXEMPTION) T HAT DETAILS OF THE BUILDING CONSTRUCTION WERE NOT SUBMITTED BY THE ASS ESSEE AND THAT THE DONATION RECEIVED BY IT WERE ANONYMOUS DONATION IN CASH WITHOUT ANY ADDRESS OR PROOF OF IDENTITY OF THE DONORS, AND THE EXPENSES OF MADRASA BUILDING CONSTRUCTION WERE INCURRED IN CASH , AND NOT SUPPORTED BY VOUCHERS, ARE NOT RELEVANT CONSIDERATI ON WHILE DECIDING THE ALLOWABILITY OF THE REGISTRATION UNDER SECTION 12AA OF THE ACT. HE SUBMITTED THAT THESE DEFECTS ARE IN FACT NON-EXISTE NT AND THE ASSESSEE HAS PRODUCED RECEIPT BOOK, AND HAS ALL THE VOUCHERS OF THE EXPENSES AND THE DONATIONS ARE NOT ANONYMOUS. HE SUBMITTED THAT THESE ISSUES MAY BE CONSIDERED WHILE FRAMING THE ASSESSMENT IN T HESE CASES FOR THE RELEVANT YEARS BY THE AO AND THE OBJECTIVES OF THE ASSESSEE BEING ITA NO.478 AND 479/AHD/2013 -4 CHARITABLE/RELIGIOUS, IT MAY BE ALLOWED REGISTRATIO N UNDER SECTION 12AA OF THE ACT. THE LEARNED DR HAS OPPOSED THE SU BMISSIONS OF THE LEARNED COUNSEL OF THE ASSESSEE. HE SUBMITTED THAT THE ASSESSEE COULD NOT PRODUCE THE EVIDENCE OF ANY ADDRESS OR PROOF OF THE IDENTITY OF THE SO-CALLED DONORS, AND IN FACT THE DONATIONS WERE AN ONYMOUS ONE. THE ASSESSEE HAS SPENT ON CONSTRUCTION FOR WHICH NO DET AILS/EVIDENCES WERE SUBMITTED BY THE ASSESSEE-TRUSTS. THE OTHER E XPENSES CLAIMED BY THE ASSESSEE WERE ALSO MADE IN CASH AND NOT SUPPORT ED BY PROPER VOUCHERS. THE DONATIONS HAVE BEEN RECEIVED IN CASH ONLY. IN THESE FACTS, HE SUBMITTED THAT THE GENUINENESS OF THE ACT IVITIES OF THE TRUST IS NOT PROVED BY THE ASSESSEE, AND FINDING OF THE DIT( EXEMPTION) IS THAT THERE IS NO EVIDENCE OF THE COMMENCEMENT OF THE ACT IVITIES, WHICH COULD BE VERIFIED. HE REFERRED TO THE RELEVANT POR TIONS OF THE ORDER OF THE DIT(EXEMPTION) IN SUPPORT OF THE CASE OF THE RE VENUE, AND HAS RELIED ON THE ORDER OF THE DIT(EXEMPTION). 5. WE HAVE CONSIDERED RIVAL SUBMISSIONS AND HAVE PE RUSED THE ORDERS OF THE DIT(EXEMPTION) AND ALSO COPIES OF VAR IOUS DOCUMENTS AND DETAILS OF THE ACCOUNT SUBMITTED BY THE ASSESSE E IN ITS COMPILATION BEFORE THE TRIBUNAL. WE FIND THAT ENGLISH TRANSLAT ION OF THE OBJECTIVES OF MADRASA BUILDING TRUST, IS AS UNDER: 4. OBJECTIVES OF THE TRUST:- THIS TRUST SHALL IMPART RELIGIOUS AS WELL AS WORLDL Y KNOWLEDGE FOR ALL THE PEOPLE OF ANY CASTE OR RELIGI ON, WHO IS INDIAN RESIDENT I.E. ARABIC (QURAN MAJID, TAFSEE , HADITH, AKAID, FIKAH), PERSIAN, URDU, GUJARATI, HIN DU & ENGLISH, WRITING THROUGH THE MEDIUM OF ALL LANGUAGE . ITA NO.478 AND 479/AHD/2013 -5 6. WE FIND THAT THE OBJECTIVES OF THE TRUST TO IMPA RT RELIGIOUS AS WELL AS WORLDLY KNOWLEDGE FOR ALL PEOPLE OF ANY CAS TE OR RELIGION, WHO IS INDIAN RESIDENTS, IN DIFFERENT LANGUAGES IS CLEA RLY CHARITABLE/ RELIGIOUS IN NATURE, WITHOUT ANY DISCRIMINATION ON ACCOUNT OF CASTE OR RELIGION FOR THE INDIAN NATIONALS, AND THEREFORE, E LIGIBLE FOR REGISTRATION UNDER SECTION 12AA OF THE ACT. IT IS NOW WELL SETT LED THAT NON- COMMENCEMENT OF THE CHARITABLE ACTIVITIES BY A TRUS T IS NOT DECISIVE FOR THE PURPOSE OF GRANTING REGISTRATION UNDER SECT ION 12AA OF THE ACT. THE ACCOUNTS OF THE ASSESSEE-TRUST ARE AUDITE D BY THE CHARTERED ACCOUNTANT, AND THE ASSESSEE HAS BEEN FILING ITS RE TURN OF INCOME WITH THE DEPARTMENT, AND WAS ISSUED A PAN CARD. A PERUS AL OF THE AUDIT ACCOUNT STATEMENTS FOR THE THREE RELEVANT YEARS DOE S NOT SHOW ANY SPENDING ON NON-CHARITABLE/RELIGIOUS PURPOSE OF THE ASSESSEE-TRUST. WE FIND THAT WITH REGARD TO VARIOUS OBJECTIONS OF T HE DIT(EXEMPTION), REGARDING NON-AVAILABILITY OF SUPPORTING VOUCHERS F OR BUILDING CONSTRUCTION, THE DONATIONS RECEIVED AND NO PROOF O F IDENTITY OF THE DONORS AND EXPENSES HAVING INCURRED IN CASH WITH NO SUPPORTING VOUCHERS, ARE THE ISSUES TO BE CONSIDERED BY THE AO AT THE TIME OF FRAMING OF THE ASSESSMENT FOR THE RELEVANT YEAR(S). WE FIND THAT AS FAR AS THE ISSUE OF REGISTRATION UNDER SECTION 12AA OF THE ACT IS CONCERNED, THE DIT(EXEMPTION) HAS TO ASCERTAIN THAT WHETHER THE OBJECTIVES OF THE ASSESSEE-TRUST ARE CHARITABLE/REL IGIOUS IN NATURE (SINCE THE TRUST WAS INCORPORATED AS BACK AS IN THE YEAR 1 954), AND IF THERE IS NO VIOLATION WITH REGARD TO THE OBJECTIVES OF THE A SSESSEE-TRUST, THE ASSESSEE-TRUST HAS TO BE GRANTED THE REGISTRATION U NDER SECTION 12AA OF THE ACT. HOWEVER, WE MAKE IT CLEAR THAT THE AO WHI LE FRAMING THE ASSESSMENT IS AT LIBERTY AND RATHER DUTY BOUND TO C ONSIDER ALLOWABILITY OR OTHERWISE OF ANY PARTICULAR EXPENSES NOT SUPPORT ED BY ITA NO.478 AND 479/AHD/2013 -6 EVIDENCES/VOUCHERS AND WITH REGARD TO DONATIONS, WH ERE THE IDENTITY OF THE DONORS COULD NOT BE PROVED BY THE ASSESSEE-T RUST. IN THESE FACTS OF THE CASE, WE ARE OF THE VIEW THAT BOTH THE ASSES SEE-TRUSTS ARE ELIGIBLE TO REGISTRATION UNDER SECTION 12AA OF THE ACT, AND THE GROUNDS OF THE APPEALS OF ASSESSEES ARE ALLOWED. 7. IN THE RESULT, BOTH THE APPEALS OF THE ASSESSEES ARE ALLOWED. ORDER PRONOUNCED IN OPEN COURT ON THE DATE MENTIONE D HEREINABOVE. SD/- SD/- ( %& %& %& %& / TEJ RAM MEENA) &' ( &' ( &' ( &' ( /ACCOUNTANT MEMBER ( . .. . . .. . /G.C. GUPTA) !' !' !' !' /VICE-PRESIDENT C OPY OF THE ORDER FORWARDED TO: 1) : APPELLANT 2) : RESPONDENT 3) : CIT(A) 4) : CIT CONCERNED 5) : DR, ITAT. BY ORDER DR/AR, ITAT, AHMEDABAD