M/s.GCDA Employees Pension Fund Trust, Cochin V. CIT, Cochin

ITA 503/COCH/2013

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 69083 (ITAT-COCHIN)
• Duration Of Justice: 3 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-11-2013
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 25-11-2013
• Assessment Year: misc
• Appeal Filed On: 29-08-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: K K JOHN
• Assessee Lawyers: T M SREEDHARANSR
• Keywords: Charitable institution; Reasonable cause
• Section: 12AA

Judgement Text

1 ITA NO.503/COCH/2013 IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH, COCHIN BEFORE SHRI N.R.S. GANESAN (JM) AND SHRI B.R. BASKA RAN(AM) I.T.A NO.503/COCH/2013 M/S GCDA EMPLOYEES PENSION FUND TRUST VS THE C.I.T .-1, CR BLDGS GREATER COCHIN DEVELOPMENT AUTHORITY I.S. PRESS RO AD KADAVANTHARA, COCHIN-682 020 COCHIN 682 018 PAN : AABTG6697C (APPELLANT) (RESPONDENT) APPELLANT BY :SHRI T.M. SREEDHARAN, SR.COUNSEL RESPONDENT BY : SHRI K.K. JOHN DATE OF HEARING : 25-11-2013 DATE OF PRONOUNCEMENT : 29-11-2013 O R D E R PER N.R.S. GANESAN (JM) THERE IS A DELAY OF 179 DAYS IN FILING THE APPEAL BEFORE THIS TRIBUNAL. SHRI T.M. SREEDHARAN, THE LD.SENIOR COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE IMPUGNED ORDER OF THE ADMINISTRATIVE COMMI SSIONER WAS RECEIVED ON 02-01-2013 AND THE APPEAL OUGHT TO HAVE BEEN FIL ED ON 02-03-2013. HOWEVER, THE EARLIER ADVOCATES ADVISED THE ASSESSEE TO EXECUTE A FRESH TRUST DEED AND THEREAFTER FILE A FRESH APPLICATION FOR REGISTRATION. SUBSEQUENTLY, THE ASSESSEE CONTACTED THE PRESENT CO UNSEL, WHO ADVISED THE ASSESSEE TRUST TO FILE APPEAL BEFORE THIS TRIBU NAL. ACCORDING TO THE 2 ITA NO.503/COCH/2013 LD.SENIOR COUNSEL, BECAUSE OF THE WRONG ADVICE GIVE N BY THE EARLIER COUNSEL, THE APPEAL COULD NOT BE FILED WITHIN THE P RESCRIBED TIME. THEREFORE, THE ASSESSEE WAS PREVENTED BY SUFFICIENT CAUSE WHICH WAS BEYOND THE CONTROL OF THE ASSESSEE FOR FILING THE A PPEAL. WE HEARD SHRI K.K. JOHN, THE LD.DR ASLO. 2. IT IS NOT IN DISPUTE THAT THE ASSESSEE WAS PREVE NTED BY REASONABLE CAUSE FROM FILING THE APPEAL IN TIME BECAUSE OF THE LEGAL ADVICE GIVEN BY ITS EARLIER COUNSEL. THEREFORE, THIS TRIBUNAL IS OF TH E CONSIDERED OPINION THAT THERE WAS SUFFICIENT CAUSE FOR NOT FILING THE APPEA L IN TIME BEFORE THIS TRIBUNAL. ACCORDINGLY, THE DELAY OF 179 DAYS IS CO NDONED AND THE APPEAL IS ADMITTED. 3. THE ONLY ISSUE ARISES FOR CONSIDERATION IS WITH REGARD TO DENIAL OF REGISTRATION U/S 12AA(1)(B)(II) OF THE ACT. 4. SHRI T.M. SREEDHARAN, THE LD.SENIOR COUNSEL SUBM ITTED THAT THE ASSESSEE TRUST WAS ESTABLISHED WITH A SOLE OBJECT O F PROVIDING PENSION TO THE EMPLOYEES, WHO RETIRED FROM THE SERVICE OF GREA TER COCHIN DEVELOPMENT AUTHORITY. ACCORDING TO THE LD.SENIOR COUNSEL, GREATER COCHIN DEVELOPMENT AUTHORITY WAS ESTABLISHED BY A S TATE ENACTMENT AND FOR THE PURPOSE OF PAYING THE PENSION TO THE RETIRE D EMPLOYEES, THE GREATER 3 ITA NO.503/COCH/2013 COCHIN DEVELOPMENT AUTHORITY ESTABLISHED THE PRESEN T TRUST. ON A QUERY FROM THE BENCH, WHETHER PAYMENT OF PENSION IS A CHA RITY, THE LD.SENIOR COUNSEL SUBMITTED THAT IN THE LARGER INTEREST, THE PAYMENT OF PENSION ALSO HAS TO BE CONSIDERED AS CHARITY. MOREOVER, IT WILL FALL WITHIN THE DEFINITION OF PUBLIC UTILITY. WE HEARD SHRI K.K. JOHN, THE LD.DR ALSO. 5. IT IS NOT IN DISPUTE THAT THE ASSESSEE TRUST WAS ESTABLISHED BY GREATER COCHIN DEVELOPMENT AUTHORITY, A STATUTORY A UTHORITY ESTABLISHED UNDER THE STATE ENACTMENT FOR PROVIDING PENSION TO THE EMPLOYEES, WHO RETIRED FROM SERVICE. IT IS WELL SETTLED PRINCIPLE S OF LAW THAT PENSION IS NOT A CHARITY. THE GOVERNMENT IS NOT DOING ANY CHARITY B Y PAYING PENSION TO THE RETIRED EMPLOYEES. PAYMENT OF PENSION IS NOTHING B UT A DEFERRED PAYMENT OF SALARY FOR THE WORK DONE BY THE EMPLOYEES. THER EFORE, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE FUND / TRUST ESTABL ISHED BY GREATER COCHIN DEVELOPMENT AUTHORITY FOR PAYING PENSION TO THE EMP LOYEES, WHO RETIRED FROM SERVICE GREATER COCHIN DEVELOPMENT AUTHORITY C ANNOT BE A CHARITABLE ACTIVITY. WHAT CANNOT BE DONE DIRECTLY, THE SAME T HING CANNOT BE DONE INDIRECTLY ALSO. IN THIS CASE, INSTEAD OF PAYING P ENSION DIRECTLY TO THE EMPLOYEES RETIRED FROM SERVICE, A TRUST WAS ESTABLI SHED FOR PAYING THE PENSION. THEREFORE, THE CHARACTER OF PAYMENT REMAI NS THE SAME. PENSION IS PAID DUE TO THE STATUTORY OBLIGATION AS PER THE SERVICE RULES. HENCE, IT CANNOT BE CONSTRUED AS PUBLIC UTILITY AS CONTENDED BY THE LEARNED SENIOR 4 ITA NO.503/COCH/2013 COUNSEL. IN VIEW OF THE ABOVE, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE ASSESSEE IS NOT ENTITLED FOR REGISTRATION U/S 12AA OF THE ACT AS CHARITABLE TRUST. ACCORDINGLY, THE ORDER OF THE AD MINISTRATIVE COMMISSIONER IS CONFIRMED AND THE APPEAL OF THE ASSESSEE STANDS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 29 TH NOVEMBER, 2013. SD/- SD/- (B.R. BASKARAN) (N.R.S. GANESAN) ACCOUNTANT MEMBER JUDICIAL MEMBER COCHIN, DT : 29 TH NOVEMBER, 2013 PK/- COPY TO: 1. M/S GCA EMPLOYEES PENSION FUND TRUST, GREATER CO CHIN DEVELOPMENT AUTHORITY, KADAVANTHARA, COCHIN 682 020 2. THE CIT-1, C.R. BUILDINGS, I.S. PRESS ROAD, COCH IN 682 018 3. THE DR (TRUE COPY) BY ORDER ASSTT. REGISTRAR, INCOME-TAX APPELLATE TRIBUNAL, COCHIN BENCH