M/s. Prachin Shani Dev Mandir Sewa Samiti, Ghaziabad V. CIT, Ghaziabad

ITA 5237/DEL/2014

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 7860 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 7 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-04-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Next Hearing Date: 01-03-2016
• Assessment Year: 2014-2015
• Appeal Filed On: 25-09-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: L M AGARWAL
• Section: 12A; 12AA

Judgement Text

1 ITA NO. 5237/DEL/201 4 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: F NEW DELHI BEFORE SHRI J. SUDHAKAR REDDY, ACCOUNTANT MEMBER AND SMT SUCHITRA KAMBLE , JUDICIAL MEMBER I.T.A .NO.-5237/DEL/2014 (ASSESSM ENT YEAR-2014-15) PRACHIN SHANI DEV MANDIR SEWA SAMITI C/O L. M. AGARWAL & C.O, CHARTERED ACCOUNTANT, KA-32, KAVI NAGAR GHAZIABAD AACA01378D (APPELLANT) VS CIT GHAZIABAD (RESPONDENT) APPELLANT BY SH. L. M. AGARWAL, CA RESPONDENT BY MS. SWATI JOSHI, CIT (DR) ORDER PER SUCHITRA KAMBLE, JM THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE OR DER DATED 25/08/2014 PASSED BY LD. CIT GHAZIABAD U/S 12AA. 2. THE GROUNDS OF APPEAL ARE AS FOLLOWS:- DATE OF HEARING 01.03.2016 DATE OF PRONOUNCEMENT 26.04.2016 2 ITA NO. 5237/DEL/201 4 1. THAT THE LD. CIT, GHAZIABAD ERRED IN LAW AS WEL L AS ON THE FACTS BY REJECTING THE APPLICATION FOR REGISTRATION U/S 1 2AA OF THE INCOME TAX ACT ON THE GROUND THAT THE REPORT OF ACI T, RANGE-1 GHAZIABAD COULD NOT RECTIFY THE ACTIVITIES AND AFFA IRS OF THE SOCIETY AS GENUINE. 2. THAT THE LD. CIT, GHAZIABAD ERRED IN LAW AS WELL AS ON THE FACTS BY REJECTING THE REGISTRATION U/S 12AA OF THE INCOM E TAX ACT EVEN AFTER VERIFYING THE AFFAIRS AND ACTIVITIES OF THE SOCIETY AND ALSO VERIFYING THE BOOKS OF ACCOUNT AND VOUCHERS FO R THE PREVIOUS YEARS. 3. THAT THE LD. CIT, GHAZIABAD ERRED IN LAW AND FA CTS IN REJECTING THE APPLICATION FOR REGISTRATION U/S 12AA OF THE IN COME TAX ACT THAT AUTHORIZATION TO THE SOCIETY TOO MAINTAIN OR C ONSTRUCT THE TEMPLES OR GHATS BY ANY AUTHORITY COULD NOT BE PROD UCED WHILE THERE IS NO SUCH REQUIREMENT PRESCRIBED UNDER THE I NCOME TAX ACT, 1961. 4. GROUND NO. 4 TO 7 REMAINS THE SAME. 3. THE APPELLANT IS A SOCIETY WHICH WAS INCORPORATE D ON 13/7/2010. THE MAIN OBJECT OF THE SOCIETY IS TO RU N AND MAINTAIN OLD SHANI MANDIR SITUATED AT THE BANK OF GANG NAHAR AT MURADNAGAR, GHAZIABAD. THERE WAS AN INVESTMENT IN DEVELOPMENT OF GHAT AND RELATED BUILDING OF RS.63,000/- AND MOS T OF THESE EXPENSES WERE INCURRED IN CASH. THE FIRST APPLICAT ION FOR REGISTRATION U/S 12A WAS REJECTED VIDE ORDER DATED 31/3/2013 ON THE GROUND THAT THE OBJECTIVE OF THE SOCIETY IS GEN ERAL IN NATURE AND IS NOT COVERED U/S 2(15) OF THE INCOME TAX ACT. TH E CIT HAS ASKED THE SOCIETY TO ASCERTAIN THE AFFAIRS AND ACTIVITIES OF THE SOCIETY. THE CIT IN ITS ORDER HELD THAT SOCIETY DOES NOT HAVE AN Y AUTHORIZATION OR LEGAL RIGHTS TO RUN AND MAINTAIN THE OLD SHANI MAND IR SITUATED AT 3 ITA NO. 5237/DEL/201 4 THE BANK OF GANG NAHAR, MURADNAGAR, GHAZIABAD OR TO EXECUTE ANY CONSTRUCTION OF THIS SIDE. THE SOCIETY PRODUCES LE TTERS WRITTEN BY IT TO DISTRICT MAGISTRATE OF GHAZIABAD DEVELOPMENT AUT HORITY AND THE POLICE DEPARTMENT FOR THE MAINTENANCE OF THE GHATS AND TEMPLES. THE CIT OBSERVED THAT THERE WAS NO PERMISSION LETTE R OR ANY OTHER EVIDENCE REGARDING AUTHORIZATION TO SOCIETY TO MAIN TAIN OR CONSTRUCT THE TEMPLE OR GHATS BY ANY OF THE AUTHORITY. THERE FORE, THE CIT REJECTED THE APPLICATION FOR GRANT OF REGISTRATION U/S 12AA OF THE INCOME TAX ACT. 4. THE LD. AR SUBMITTED THAT THERE WAS A LETTER DAT ED 5/5/2015 FROM THE GHAZIABAD DEVELOPMENT AUTHORITY RECOMMENDI NG THAT THE MAINTENANCE OF THE GHATS AND TEMPLE BE GIVEN TO THE SOCIETY. THE SAME WAS IGNORED BY THE CIT. THE CIT ALSO IGNORED THE BALANCE- SHEET OF THE SOCIETY WHEREIN INVESTMENT IN DEVELOPM ENT OF GHAT WAS SHOWN IN THE BALANCE-SHEET AS ON 31/3/2011. 5. THE LD. DR RELIED UPON THE ORDER OF THE CIT(A). 6. WE HAVE PERUSED ALL THE RECORDS AND HEARD BOTH T HE COUNSELS. THE MAIN OBJECTIVE OF THE ASSESSEE WAS TO RUN AND M AINTAIN OLD SHANI MANDIR ON THE BANK OF GANG NAHAR. THE DEVOTE ES NORMALLY TAKE BATH AT THE BANK OF THE RIVER. AS THE TEMPLE I S NEXT TO THE BANKS OF THE RIVER, IT WAS A NECESSITY TO BUILD A G HAT OR TO MAINTAIN THE GHAT SITUATED THEREIN BECAUSE, PUBLIC COME FOR RELIGIOUS RITUALS. THUS, THE ACTIVITIES OF THE SOCIETY ARE CHARITABLE IN NATURE AND FALL WITHIN THE CATEGORY OF ADVANCEMENT OF ANY OTHER OBJ ECT OF GENERAL PUBLIC UTILITY. THE CIT IS WRONG IN COMING TO A CON CLUSION THAT THE 4 ITA NO. 5237/DEL/201 4 ACTIVITIES OF THE SOCIETY ARE NOT CHARITABLE AS IT DOES NOT HAVE PERMISSION. THE CIT IGNORED A LETTER DATED 5/5/2015 FROM THE GHAZIABAD DEVELOPMENT AUTHORITY RECOMMENDING THE SO CIETY AS WELL AS THE BALANCE-SHEET OF THE SOCIETY WHEREIN IN VESTMENT IN DEVELOPMENT OF GHAT WAS SHOWN. LETTERS TO THE DISTR ICT ADMINISTRATION ARE IGNORED BY THE CIT. THE CIT HAS NOT STATED WHAT ARE THE PERMISSION THAT THE ASSESSEE IS REQUIRED TO GET AND WHAT IT DID NOT GET. NO RULES OR REGULATIONS ARE QUOTED. NO AUTHORITY HAS OBJECTED OR HELD THAT THE ACTIVITY OF THE TRUST IS ILLEGAL OR UNAUTHORIZED. THE FACT REMAINS THAT, THE PUBLIC UTI LITY IS DEVELOPED AND MAINTAINED BY THE ASSESSEE. THEREFORE, THE REJE CTION BY THE CIT REGARDING THE APPLICATION U/S 12AA IS NOT CORRECT. HENCE, WE DIRECT THE CIT TO GRANT REGISTRATION TO THE ASSESSEE UNDER SECTION 12AA OF THE INCOME TAX ACT, 1961 7. IN RESULT, APPEAL IS ALLOWED. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 26 TH OF APRIL, 2016. SD/- SD/- (J. SUDHAKAR REDDY) (SUCHITRA KAMBLE) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 26/04/2016 R. NAHEED * COPY FORWARDED TO: 5 ITA NO. 5237/DEL/201 4 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT R EGISTRAR ITAT NEW DELHI DATE 1. DRAFT DICTATED ON 01/03/2016 PS 2. DRAFT PLACED BEFORE AUTHOR 02/03/2016 PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER .2016 JM/AM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER. JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS 27.04.2016 PS/PS 6. KEPT FOR PRONOUNCEMENT ON PS 7. FILE SENT TO THE BENCH CLERK 27.04.2016 PS 8. DATE ON WHICH FILE GOES TO THE AR 9. DATE ON WHICH FILE GOES TO THE HEAD CLERK. 10. DATE OF DISPATCH OF ORDER. 6 ITA NO. 5237/DEL/201 4