Lord Krishna Charitable Trust, Rohtak V. CIT, Rohtak

ITA 5266/DEL/2011

• Counselvise Citation: 526620114 RSA 2011
• Duration Of Justice: 9 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-08-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 02-07-2012
• Assessment Year: misc
• Appeal Filed On: 28-11-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R S NEG I SR DR HEARING ON
• Keywords: Charitable institution; Cancellation of registration
• Section: 12A; 12AA; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: D NEW DELHI BEFORE SHRI G.D. AGRAWAL, HONBLE VICE-PRESIDENT AN D SHRI I.C.SUDHIR, JUDICIAL MEMBER I.T.A. NO. 5266/DEL/2011 ASSESSMENT YEAR: N.A. LORD KRISHNA CHARITABLE TRUST, COMMISSIONER OF IN COME TAX 510/35,JANTA COLONY, VS. ROHTAK (HARYANA) ROHTAK-124001. PAN: AAATL6430D (APPELLANT) (RESPONDENT) APPELLANT BY: SHRI NAVIN GUPTA, ADV. RESPONDENT BY: SHRI R.S.NEG I, SR. DR HEARING ON : 2/07/2012 ORDER PRONOUNCED ON THE DATE: .. ORDER PER I.C.SUDHIR, JM: THE APPELLANT HAS QUESTIONED ORDER DATED 22.9.2011 OF THE LD. CIT WHEREBY HE HAS REJECTED THE APPLICATION OF THE APPE LLANT FOR REGISTRATION U/S 12A OF THE ACT. 2. THE CONTENTION OF THE LD. AR REMAINED THAT ALL THE OBJECTS OF THE TRUST ARE ELIGIBLE FOR GRANT OF REGISTRATION U/S 12A OF T HE ACT. THE OBJECT OF THE TRUST IS IMPARTING EDUCATION AMONGST THE PEOPLE OF INDIA PARTICULARLY OF RURAL ITANO5266/DEL/2011 2 AREA, WITHOUT ANY DISCRIMINATION AS TO RELIGION, RA CE, CASTE OR SEX. HE POINTED OUT THAT TO MEET THE OBJECT OF THE TRUST, THE APPEL LANT TRUST HAS OPENED A POLYTECHNIC TO TRAIN STUDENTS FOR EMPLOYMENT RELATE D COURSE AND TO MAKE THEM SELF-DEPENDENT. THE LD. AR SUBMITTED THAT THE LD. CIT HAS REJECTED THE APPLICATION FOR REGISTRATION MAINLY ON THE BASIS TH AT THE APPELLANT DID NOT FURNISH THE ORIGINAL INSTRUMENT OF ITS ESTABLISHMEN T, THE INSTRUMENT CREATES AMBIGUITY REGARDING STATUS OF THE INSTITUTE, THE TR UST IS CONTROLLED BY THE BOARD OF TRUSTEES HAVING 10 TRUST OUT OF WHICH 4 TR USTEES ARE FROM THE SAME FAMILY AND THE LD. JCIT VIDE HER REPORT DATED 1.9.2 011 HAS INFORMED THAT THE CHARITABLE NATURE OF THE ACTIVITIES BEING UNDER TAK EN BY THE APPELLANT AT PRESENT HAS NOT BEEN BROUGHT ON RECORD AND THE LD. JCIT HAS REPORTED FURTHER THAT UNSECURED LOANS HAVE BEEN ACCEPTED FROM VARIOU S PERSONS BUT NO MATERIAL FACT HAS BEEN BROUGHT ON RECORD TO PROVE T HE GENUINENESS OF THE PERSONS. THE LD. AR SUBMITTED THAT ORIGINAL COPY OF THE TRUST DEED WAS MADE AVAILABLE BEFORE THE LD. CIT, THE MISTAKE APPEARING IN THE TRUST DEED WAS RECTIFIED AND AMENDED, THE LD. CIT HAS NOT REFERRED THE REPORT OF ACIT DATED 30.6.2011/11.7.2011, WHEREIN THE ACIT WHILE, DISCUS SING THE FACTS OF THE CASE HAD RECOMMENDED FOR REGISTRATION OF THE TRUST U/S 12AA OF THE ACT WITH THIS OBSERVATION IN PARA NO. 8 OF THE SAID REPORT T HAT THE TRUST FULFILS THE CONDITIONS LAID DOWN IN SECTION 11 OF THE ACT. THE LD. AR PLACED RELIANCE ITANO5266/DEL/2011 3 ON THE DECISION OF AHMEDABAD BENCH OF THE TRIBUNAL IN THE CASE OF JUPITER MEDICAL RESEARCH CENTRE TRUST VS. DCIT (2010) 128 T TJ (AHMEDABAD) (UO) 118 HOLDING THAT MERELY BECAUSE THE TRUSTEES A RE MEMBERS OF ONE FAMILY, IT CANNOT BE SAID THAT THE TRUST IS NOT A P UBLIC TRUST. HE ALSO PLACED RELIANCE ON THE FOLLOWING DECISIONS: I) SONEPAT HINDU EDUCATIONAL AND CHARITABLE SOCIETY VS. COMMISSIONER OF INCOME TAX AND ANOTHER 278 ITR 262 (P&H) II) N.N. DESAI CHARITABLE TRUST VS. COMMISSIONER OF INCOME TAX 246 ITR 452 (GUJARAT) III) KALYANAM KAROTI VS. COMMISSIONER OF INCOME TAX-II, 123 ITD 317 (LUCK.) 3. THE LD. AR REFERRED PAGE NOS 1 TO 21 OF THE PAPER B OOK FILED ON BEHALF OF THE APPELLANT, WHEREIN COPIES OF TRUST DE ED, REGISTERED AMENDED DEED TO TRUST DEED, REPORT OF THE AO AND LD. JCIT, QUESTIONNAIRE ISSUED BY THE LD. CIT AND RETURNED SUBMISSION OF THE APPELLAN T BEFORE THE LD. CIT HAVE BEEN MADE AVAILABLE. 4. THE LD. DR ON THE OTHER HAND TRIED TO JUSTIFY THE O RDER IMPUGNED WITH THIS SUBMISSION THAT IT IS SATISFACTION OF THE LD. CIT WHICH IS REQUIRED FOR GRANTING REGISTRATION U/S 12A OF THE ACT. 5. HAVING GONE THROUGH THE ORDER IMPUGNED AND MATERIAL AVAILABLE ON RECORD, WE FIND THAT THE LD. CIT HAS NOT CONSIDERED THE REPORT DATED 30.6.2011/11.7.2011 OF THE ACIT ADDRESSED TO HIM WH EREIN AFTER DISCUSSING THE CASE OF APPELLANT HE HAS RECOMMENDED FOR GRANTI NG OF REGISTRATION OF THE ITANO5266/DEL/2011 4 TRUST U/S 12A OF THE ACT WITH THIS OBSERVATION IN P ARA NO. 8 OF THE REPORT THAT THE APPELLANT TRUST FULFILS THE CONDITIONS LAID DOW N IN SECTION 11 OF THE INCOME TAX ACT, 1961. THE LD. CIT HAS INSTEAD REFER RED THE REPORT DATED 26.8.2011/1.9.2011 FURNISH BY JCIT TO HIM AS A BASI S FOR REJECTION OF THE APPLICATION FOR THE REGISTRATION. LD. CIT HAS NOT A SSIGNED ANY REASON AS TO WHY HE DID NOT FIND IT FIT TO CONSIDER THE REPORT D ATED 30.6.2011/11.7.2011 OF THE LD. ACIT, WHEREIN HE HAD RECOMMENDED REGISTRATI ON OF THE TRUST. THE LD. CIT HAS ALSO TAKEN IT AS ADVERSE TO THE ELIGIBI LITY OF THE REGISTRATION THAT THE TRUST IS CONTROLLED BY THE BOARD OF THE TRUSTEE S HAVING 10 TRUSTEES OUT OF WHICH 4 TRUSTEES ARE FROM THE SAME FAMILY. IN THE D ECISION OF AHMEDABAD BENCH OF THE TRIBUNAL IN THE CASE OF JUPITER MEDICA L RESEARCH CENTRE TRUST VS. DCIT (E) (SUPRA) RELIED UPON BY THE LD. AR IT H AS BEEN HELD THAT MERELY BECAUSE THE TRUSTEES ARE MEMBERS OF ONE FAMILY, IT CANNOT BE SAID THAT THE TRUST IS NOT A PUBLIC TRUST. IN THAT CASE THERE WAS ALSO NO FINDING OR ALLEGATION IN THE IMPUGNED ORDER THAT THE ACTIVITIES CARRIED O UT BY THE TRUST WERE NOT IN ACCORDANCE WITH ITS OBJECTS, THE TRIBUNAL HELD THAT THERE WAS NO CASE FOR CANCELLATION OF REGISTRATION U/S 12AA OF THE ACT. T HE CLAIM OF THE APPELLANT ALSO REMAINED THAT THE DEFECTS AS POINTED OUT BY TH E LD. CIT IN THE TRUST DEED WERE ALSO REMOVED BY RECTIFICATION/AMENDMENT TO THE TRUST DEED WHICH HAS NOT BEEN CONSIDERED BY THE LD. CIT WHILE DISPOSING OFF THE APPLICATION FOR ITANO5266/DEL/2011 5 THE REGISTRATION. UNDER THESE CIRCUMSTANCES AND WIT HOUT GOING INTO THE DISPUTE AS TO WHETHER ORIGINAL INSTRUMENT WAS FURNI SHED BEFORE THE CIT OR NOT, WE IN THE INTEREST OF JUSTICE SET ASIDE THE MA TTER TO THE FILE OF THE LD. CIT FOR FRESH CONSIDERATION OF THE REQUEST OF REGISTRAT ION MADE BY THE APPELLANT IN THE APPLICATION DATED 30.3.2011 AFTER AFFORDING OPP ORTUNITY OF BEING HEARD TO THE APPELLANT. THE APPELLANT IS ALSO DIRECTED TO FU RNISH ORIGINAL TRUST DEED ALONG WITH AMENDED INSTRUMENT IN ORIGINAL FOR THE C ONSIDERATION OF THE LD. CIT. 6. THE GROUND IS ACCORDINGLY ALLOWED FOR STATISTICAL P URPOSES. 7. CONSEQUENTLY APPEAL IS ALLOWED FOR STATISTICAL PURP OSES. 8. THE ORDER PRONOUNCED IN THE OPEN COURT ON THE DAY 3 1/08/2012. SD/- SD/- G.D.AGRAWAL ) (I.C.SUDH IR) VICE-PRESIDENT JUDICIAL MEMBER DATED: 31/08/2012 *AK VERMA* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR