Shri Akshar Education and Charitable Trust, RAJKOT-GUJARAT V. The Commissioner of Income Tax-I, RAJKOT-GUJARAT

ITA 487/RJT/2014

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 1305 (ITAT-RAJKOT)
• Duration Of Justice: 1 year(s) 8 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-04-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 07-04-2016
• Assessment Year: misc
• Appeal Filed On: 11-08-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: HARGOVIND SINGH
• Keywords: Charitable institution
• Section: 12AA

Judgement Text

ITA NO. 487 / RJT/ 201 4 PAGE 1 OF 4 IN THE INCOME TAX APPELLATE TRIBUNAL RAJKOT BENCH, RAJKOT (CONDUCTED THROUGH E - COURT AT AHMEDABAD) BEFORE SHRI ANIL CHATURVEDI, ACCOUNTANT MEMBER AND SHRI S.S. GODARA, JUDICIAL MEMBER ITA NO. 487 /RJT/201 4 SHRI AKSHAR EDUCATION & CHARITABLE TRUST VS. COMMISSIONER OF INCOME TAX, ARPIT, TANTI PA R K STREET NO.1, RAJKOT - I . OPP. BIG BAZAR, RAJKOT . [PAN: AA MTS 8247 F ] (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI MEHUL RANPURA , C.A. RESPONDENT BY : SHRI HARGOVIND SINGH , D.R. DATE OF HEAR ING : 0 7 .04.2016 DATE OF PRONOUNCEMENT : 22 .04.2016 O R D E R PER S.S. GODARA, J.M. BY WAY OF THIS APPEAL THE ASSESSEE APPELLANT HAS CHALLENGED CORRECTNESS OF THE ORDER DATED 27.06.2014 PASSED BY THE C IT, RAJKOT - I REJECTING REGISTRATION UNDER SECTION 12AA OF THE INCOME TAX ACT, 1961; IN SHORT THE ACT . 2. THE ASSESSEE S SOLE SUBSTANTIVE GROUND CHALLENGES THE LOWER APPELLATE ORDER DENYING IT SECTION 12AA REGISTRATION. IT IS TO BE SEEN THAT THE ASSESSEE T UST IS FOUND WITH THE FOLLOWING OBJECTS: EDUC ATIONAL ESTABLISH AND RUN AND ADMINISTER PRE - SCHOOL, PRIMARY AND HIGH SCHOOL, COLLEGES, SANSKRIT SCHOOL, HOSTEL, TECHNICAL - SCHOOL AND OTHER SIMILAR EDUCATIONAL INSTITUTES. PROVIDE SCHOLARSHIPS TO STUDENTS AND PROVIDE EDUCATIONAL BOOKS FREE OF COST OR AT D ISCOUNTED RATE. RUN BOOK BANK OF EDUCATIONAL BOOKS. TO DEVELOP FEELING OF SERVICE, RITE AND SPIRITUALITY IN STUDENTS, CONDUCT ACTIVITIES OF ART, MUSIC, PLAY, YOGA - EDUCATION, SPORTS AND EXERCISE ETC. FOR EDUCATIONAL PUBLICITY AND GENERAL ITA NO. 487 / RJT/ 201 4 PAGE 2 OF 4 AWARENESS IN PUBLIC CONDUCT AND ORGANIZE CAMPS, LECTURES OR EDUCATIONAL CLASSES AND RUN VARIOUS OTHER EDUCATIONAL INSTITUTIONS. CARRY OUT ALL ACTIVITIES FOR EDUCATIONAL UPLIFTMENT AND ASSIST AND HELP OTHER SIMILAR INSTITUTES IN EVERY WAY POSSIBLE. MEDICAL ESTABLISH AND RUN DISPENSARY, NURSING HOME, HOSPITALS ETC. FOR GENERAL PUBLIC IN VARIOUS FIELDS OF MEDICINE LIKE ALLOPATHY, HOMEOPATHY, UNANI ETC. TO ESTABLISH AND RUN PATHOLOGY LAB, MEDICAL CURE CENTER, X - RAY CLINIC ETC. TO CARRY OUT ACTIVITIES FOR PROMOTION OF VARIOUS NA TURAL PROCEDURES VIZ. YOGA, PRANAYAM, ACCUPRESSURE, GAU - MUTRA ARC ETC. FOR HEALTH OF GENERAL PUBLIC. FOR SUCH TYPE OF VARIOUS MEDICAL ACTIVITIES ESTABLISH PHARMACY AND HEALTH CENTRES WHEREIN PROVIDE MEDICINES OF AYURVEDIC AND NATURAL CURE. TO PROVIDE MEDIC INES AT DISCOUNTED RATES ESTABLISH AND RUN CENTRES AND STORES. FOR CURE OF VARIOUS TYPES OF DIESES CONDUCT AND ORGANIZE CAMPS AND HELP INSTITUTES ORGANIZING SUCH CAMPS. TO HELP INSTITUTES RUNNING HOSPITALS FOR GENERAL PUBLIC WITH SUCH CHARITABLE OBJECT. TO ESTABLISH AND RUN BLOOD BANK AND EYE BANK. TO HELP IN POOR AND NEEDY PEOPLE FOR MEDICAL TREATMENT. ESTABLISH SANATORIUM AND BHOJNALAY FOR PATIENTS AND THEIR HELPERS. OTHER CHARITABLE OBJECT TO HELP POOR AND NEEDY PEOPLE IN CASH OR IN KIND. HELP CHILDREN HAVING PHYSICAL DISABILITY. HELP INSTITUTES RUNNING BLIND SCHOOL, DEAF - DUMB INSTITUTION, ORPHANAGE, OLD AGE HOME ETC. HELP PEOPLE IN NATURAL CALAMITIES VIZ. FLOOD, EARTHQUAKE, CYCLONE OR OTHER NATURAL CALAMITIES IN CASH OR IN KIND. ESTABLISH AND RUN PANJR APOLE. ESTABLISH AND RUN HIGH QUALITY GAUSHALA FOR PRESERVATION AND PROTECTION OF GAU - VANSH. TO SERVE IN GAUSHALA AND HELP INSTITUTES RUNNING SUCH GAUSHALA. ARRANGE CATTLE CAMPS FOR DISABLED AND ILL CATTLE. PROVIDE FOODS TO BIRDS AND MAKE ARRANGEMENTS FOR THE SAME. TO DO EVERYTHING FOR UPLIFTMENT OF RURAL PUBLIC. FOR MENTAL UPLIFTMENT AND ENCOURAGE THEM TO LEAVE ADDICTIONS ORGANIZE SEMINAR, SHIBIR, LECTURE ETC. AND ESTABLISH AND BUILD LECTURE HALL, PRAYER HALL ETC. FOR SUCH SEMINARS, LECTURES ETC. PUBLISH M AGAZINES AND OTHER PUBLICATIONS FOR THE BENEFIT OF GENERAL PUBLIC. RUN READING ROOMS AND LIBRARIES. CARRY OUT ACTIVITIES OF TREE PLANTATIONS AND PROVIDE PLANTS AT SUBSIDIZED RATES. CARRY OUT NECESSARY WORK FOR THE BENEFIT OF ENVIRONMENT. TO COORDINATE FOR ANY PUBLIC CHARITABLE WORK WITH ANY OTHER INSTITUTE HAVING SIMILAR OBJECTS AND ADMINISTER OR MERGE SUCH INSTITUTES IN THE TRUST. 3 . THE ASSESSEE APPLIED FOR SECTION 12AA REGISTRATION ON 23.12.2013. THE CIT INTER ALIA OBSERVED THAT IT S OBJECTS UNDER TH E HEAD GENERAL PUBLIC UTILITY ARE NOT CHARITABLE , M ORE PARTICULARLY THAT PERTAINING TO PUBLICATION OF LITERATURE. HE OBSERVED THAT THIS CLAUSE ITA NO. 487 / RJT/ 201 4 PAGE 3 OF 4 WAS NOT INCLUDED IN EITHER OF THE OTHER MAIN TWO OBJECTS. THE CIT FURTHER FOUND THE ASSESSEE TO HAVE PAID FEE OF FOUR SCHOOL STUDENTS ALL OF THEM BELONGING TO PATEL COMMUNITY. HE WAS OF THE OPINION THAT THIS CAUSED BENEFITS TO A PARTICULAR CAST ONLY. HE THEREAFTER CAME TO ASSESSEE S CASH BOOK AND ALLEGED THAT THE SAME HAD NOT BEEN MAINTAINED PROPERLY. ALL THES E FACTS MADE THE CIT TO CONCLUDE THAT ASSESSEE S OBJECTS AND ACTIVITIES WERE NEITHER CHARITABLE NOR GENUINE. THIS LEADS THE ASSESSEE AGGRIEVED. 4 . WE HAVE HEARD BOTH THE PARTIES. THERE IS NO DISPUTE ABOUT THE ASSESSEE S OBJECTS BEING IN THE NATUR E OF EDUCATION, MEDICAL AND OTHERS FALLING IN GENERAL PUBLIC CATEGORY. IT S TRUST DEED DOES NOT CONTAIN ANY CLAUSE TO BE SUPPORTIVE OF ANY PARTICULAR CAST, CREED , RELIGION OR INVOLVING ANY PROFIT MOTIVE. THERE IS RATHER A SPECIFIC SPECULATION TO THE CONTRARY. THE CIT S OBJECTION IS THAT IT S PUBLICATION OF LITERATURE IS AN OBJECT OF COMMERCIAL NATURE. HON BLE MADRAS H IGH C OURT S DECISION IN THE CASE OF DIT(E) VS . .SEERVI SAMAJ T AMBARAM TRUST (2014) 362 ITR 199 HOLDS THAT SECTION 12AA REGISTRATION IS NOT TO BE DENIED FOR NON - COMMENCEMENT OF CHARITABLE ACTIVITIES. WE FOLLOW THE SAME REASONING TO OBSERVE THAT COMMERCIAL ELEMENT BEING EMBEDDED IN ASSESSEE S GENERAL PUBLIC UTILITY CLAUSE, NON - MAINTENANCE OF CASHBOOK PROPERLY ETC. ARE THE MATTERS TO BE EXAMINED IN A PPROPRIATE EXEMPTION PROCEEDINGS AND NOT IN REGISTRATION STAGE. IT HAS COME ON RECORD THAT ASSESSEE S OBJECTS ARE IN THE FIELD OF EDUCATION, MEDICAL AND GENERAL PUBLIC UTILITY CATEGORIES. WE ACCEPT IT S ARGUMENTS ACCORDINGLY AND HOLD IT FIT FOR GRANTING SECTION 12AA REGISTRATION AT THIS STAGE. IT IS MADE CLEAR THAT OUR INSTANT ADJUDICATION SHALL IN ANY CASE NOT COME IN THE WAY OF APPROPRIATE AUTHORITY IN EXEMPTION PROCEEDINGS ADJUDICATING WITH ASSESSEE S CLAIM OF HAVING CARRIED OUT CHARITABLE ACTIVITIES. WE ACCORDINGLY SET ASIDE CIT S ORDER UNDER CHALLENGE. ITA NO. 487 / RJT/ 201 4 PAGE 4 OF 4 5 . THIS ASSESSEE S APPEAL IS ALLOWED. PRONOUNCED IN THE OPEN C OURT TODAY ON TH E 22 ND DAY OF APRIL, 2016. SD/ - SD/ - ANIL CHATURVEDI S.S. GODARA (ACCOUNTANT ME MBER) (JUDICIAL MEMBER) AHMEDABAD, THE 22 ND DAY OF APRIL , 2016 PBN/ * COPIES TO: (1) THE APPELLANT (2) THE RESPONDENT (3) COMMISSIONER (4) CIT(A) (5) DEPARTMENTAL REPRESENTATIVE (6) GUA RD FILE BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL RAJKOT BENCH, RAJKOT