Delhi Music Society, New Delhi V. DIT (E), Delhi

ITA 5061/DEL/2011

• Counselvise Citation: 506120114 RSA 2011
• Duration Of Justice: 10 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-09-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 11-09-2012
• Assessment Year: misc
• Appeal Filed On: 14-11-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: RAJIV CHOPRA
• Keywords: Charitable institution
• Section: 80G

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: B NEW DELHI BEFORE SHRI S.V.MEHROTRA, ACCOUNTANT MEMBER AND SHRI KULBHARAT, JUDICIAL MEMBER I.T.A .NO.- 5061/DEL/2011 (ASSESSMENT YEAR- ----------) DELHI MUSIC SOCIETY, VS DIT(E) 8, NYAYA MARG, LAXMI NAGAR, DISTT. CENTRE, CHANAKYAPURI, NEW DELHI-92. NEW DELHI-21. PAN-AAAAD0090Q (A PPELLANT) (RESPONDENT ) APPELLANT BY: SH. RAJIV CHOPRA, CA RESPONDENT BY: SH. SANJAY K. JAIN, SR. DR APPEAL HEARD ON-11.09.2012 ORDER PRONOUNCED ON-14.09.2012 ORDER PER KULBHARAT, JM THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF DIRECTOR OF INCOME TAX (EXEMPTION) [DIT(E)], DELHI. 2. THE ASSESSEE IN THIS APPEAL HAS RAISED FOLLOWING GROUNDS OF APPEAL:- 1). THAT THE IMPUGNED ORDER REJECTING THE RENEWAL O F EXEMPTION U/S 80G IS BAD IN LAW, ERRONEOUS AND CONT RARY TO THE FACTS ON RECORDS. THE ORDER SEEMS TO BE PASSED IN HASTE WITH EVEN THE FACTS OF DATES OF NOTICES AND APPEARANCES BY THE AUTHORIZED REPRESENTATIVES OF THE SOCIETY RECORDED ERRONEOUSLY. 2). THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE , THE LEARNED DIRECTOR OF INCOME TAX (EXEMPTION), DIT(E), HAS FAILED TO APPRECIATE THE FACTS, EVIDENCES AND FAILI NG TO RECOGNIZE THE HISTORY OF THE PETITIONER SOCIETY WHICH IS A CH ARITABLE SOCIETY I.T.A .NO.- 5061/DEL/2011 2 RUNNING AN EDUCATIONAL INSTITUTION EXISTING SOLELY FOR IMPARTING EDUCATION IN WESTERN CLASSICAL MUSIC. 3). THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE , THE LEARNED DIT(E) ERRED IN SUDDENLY TERMING IMPARTING OF MUSIC EDUCATION AS A COMMERCIAL ACTIVITY, WHEREAS THE INC OME TAX DEPARTMENT ITSELF HAS BEEN RECOGNIZING THE ACTIVITI ES BEING CARRIED OUT BY THE SOCIETY/SCHOOL FOR A PERIOD SPAN NING CLOSE TO FOUR DECADES. 4). THAT THE LEARNED DIT(E) HAS IN HIS ORDER FAILED TO APPRECIATE THE FACT THAT THERE HAS BEEN NO CHANGE I N THE AIMS, OBJECTS AND/OR ACTIVITIES CARRIED OUT BY THE SOCIET Y IN THE ENSUING PERIOD AND THERE HAS BEEN NO INFRINGEMENT W HATSOEVER OF THE PROVISIONS OF SECTION 2(15) OF THE INCOME TA X ACT, 1961. THE LEARNED DIT(E) ERRED IN IGNORING THE AFFIDAVIT AND CERTIFICATE TO THIS EFFECT WHICH WERE FURNISHED ALO NG WITH THE APPLICATION IN FORM 10G. 5). THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE , THE ORDER OF THE LEARNED DIT(E) IS VITIATED AND ERRONEOUS AS IT FAILED TO INTERPRET THE PROVISIONS OF INCOME TAX ACT, 1961 AN D THE LEGAL PRONOUNCEMENTS ACCORDING TO WHICH THERE IS NO CONDITION TO HOLD THAT TO BECOME CHARITABLE PURPOSES IN RESPECT OF IMPARTING EDUCATION, THE SAME SHOULD BE IMPARTED FR EELY OR WITHOUT CHARGING ANY FEES ; SO LONG AS IMPARTING SUCH EDUCATION IS NOT FOR THE BENEFIT OF ANY PARTICULAR RELIGION, COMMUNITY OR CASTE AS ENVISAGED IN SUB-CLAUSE (III) OF SUB- SECTION (5) OF SECTION 80G, THE ASSESSEE CANNOT BE DENIED EXEMPTION. 6). THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE , THE LEARNED DIT(E) ERRONEOUSLY HELD THAT THE SOCIETY HA D NOT SATISFIED THE CONDITIONS LAID OUT UNDER PROVISIONS OF SECTION 80G(5) WHEREAS THE FACT, PROVEN BEYOND DOUBT AND DU LY SUPPORTED BY DOCUMENTARY EVIDENCE, IS THAT DELHI MU SIC SOCIETY FULFILLS ALL THE FIVE CONDITIONS LISTED IN SUB CLAU SE (I) TO (V) OF SECTION 80G(5). 7). THAT THE LEARNED DIT(E) ERRED IN INTERPRETING T HAT THE ACTIVITIES CARRIED OUT BY THE SOCIETY ARE H IT BY T HE PROVISO TO SECTION 2(15) OF THE INCOME TAX ACT, 1961, WHICH IS CONTRARY TO THE FACTS AND CIRCUMSTANCES AND THE DOCUMENTARY EVI DENCE ON RECORDS. 8). THAT THE APPELLANT RESERVES THE RIGHT TO SUBMIT FURTHER GROUNDS AND TO AMEND, ALTER OR OTHERWISE MODIFY THE GROUNDS IF ANY, BEFORE OR AT THE TIME OF HEARING OF APPEAL. I.T.A .NO.- 5061/DEL/2011 3 3. THE ONLY ISSUE INVOLVED IN THIS CASE IS OF REJEC TION OF APPLICATION FOR RENEWAL OF EXEMPTION/REGISTRATION U/S 80G OF THE IN COME TAX ACT, 1961 (HEREIN AFTER REFER TO AS THE ACT). THE BRIEFLY F ACTS ARE THAT THE ASSESSEE IS A SOCIETY DULY UNDER THE REGISTRATION OF SOCIETIES AC T, 1860, AND WAS GRANTED EXEMPTION U/S 88, PRESENTLY SECTION 80G OF THE INCO ME TAX ACT AND WAS RENEWED FROM TIME TO TIME. THE ASSESSEE SOCIETY WA S GRANTED RENEWAL NO. DIT(E)/2008-09/D-70/1605 DATED 18.08.2008 VIDE ORD ERS U/S 80G(5)(VI) OF THE ACT, HAVING A VALIDITY FOR THREE YEARS FROM 01 .04.2008 TO 31.03.2011. THE ASSESSEE SOCIETY MADE AN APPLICATION DATED 01.0 3.2011 FOR RENEWAL OF EXEMPTION U/S 80G OF THE ACT. THE SAID APPLICATION WAS REJECTED BY THE LD. DIT(E). 4. LD. AR SUBMITTED THAT THERE IS AN AMENDMENT U/S 80G(5)(VI) AND THIS AMENDMENT WAS NOT CONSIDERED BY THE LD. DIT(E) WHIL E REJECTING THE APPLICATION. ON THE CONTRARY, LD. SENIOR DR HAS RE LIED ON THE ORDER OF LD. DIT(E) AND SUBMITTED THAT NO SUCH GROUNDS ARE TAKEN IN THE GROUNDS OF APPEAL. HOWEVER, SINCE THIS IS A LEGAL GROUND, SAM E IS ADMITTED FOR ADJUDICATION. 5. WE HAVE HEARD THE RIVAL CONTENTION PERUSED THE M ATERIAL AVAILABLE ON RECORD. THE FACT THAT THE ASSESSEE SOCIETY WAS GRA NTED EXEMPTION U/S 80G AND WAS DULY GRANTED CERTIFICATE OF REGISTRATION TO THIS EFFECT IS NOT DISPUTED. SINCE, THE PROVISO TO U/S 80G(5)(VI) HAS BEEN OMITT ED BY THE FINANCE (NO.-2) I.T.A .NO.- 5061/DEL/2011 4 ACT, 2009 W.E.F 01.10.2009 PRIOR TO ITS OMISSION, THE PROVISO WAS AMENDED BY THE FINANCE ACT, 1993 W.E.F 01.04.1993 WHICH REA DS AS UNDER:- PROVIDED THAT ANY APPROVAL SHALL HAVE EFFECT FOR S UCH ASSESSMENT YEAR OR YEARS, NO EXCEEDING FIVE ASSESSM ENT YEARS AS MAY BE SPECIFIED IN THE APPROVAL. 6. IN THIS VIEW OF THE MATTER, THE ORDER OF LD. DIT (E) IS SET ASIDE AND THE MATTER IS REMITTED BACK TO THE FILE OF LD. DIT(E) T O DECIDE AFRESH IN THE LIGHT OF AMENDMENT U/S 80G(5)(VI) OF THE ACT. 7. THIS APPEAL OF THE ASSESSEE IS, THEREFORE, ALLOW ED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON14.09.2012. SD/- SD/- (S.V.MEHROTRA) (KULBHARAT) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 14/09/2012 *AMIT KUMAR* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI I.T.A .NO.- 5061/DEL/2011 5