SAFI(Social Advancement Foundation of India), Malappuram V. CIT, Calicut

ITA 530/COCH/2009

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 4528 (ITAT-COCHIN)
• Duration Of Justice: 1 year(s) 7 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-06-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 14-06-2011
• Assessment Year: misc
• Appeal Filed On: 04-11-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VIJAYAPRABHA
• Assessee Lawyers: K B MOHAMMED KUTTY
• Keywords: Charitable institution; Opportunity of being heard
• Section: 80G; 12A; 12AA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH, COCHIN BEFORE SHRI N.VIJAYAKUMARAN & SHRI SANJAY ARORA I.T.A.NO. 530 /COCH/200 9 SAFI(SOCIAL ADV ANCEMENT FOUNDATION OF INDIA), RIYAS NAGAR, SIAS BUILDING, VAZHAYUR, MALAPPURAM. PA NO.AADTS 7863A VS. THE COMMISSIONER OF INCOME-TAX, CALICUT. (APPELLANT) ( RESPONDENT ) APPELLANT BY SHRI K.B. MOHAMMED KUTTY, SR.ADVOCATE RESPONDENT BY MS. VIJAYAPRABHA, JR.D.R. O R D E R PER N.VIJAYAKUMARAN,J.M: THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E DENIAL OF RECOGNITION U/S.80G OF THE I.T. ACT DATED 4-8-2009. IN FACT IT IS THE RENEWAL OF RECOGNITION. THE LD. COMMISSIONER FOUND ON EXAMINATION OF RECORDS THAT REGISTRATION U/S.12A WAS GIVEN TO THE ASSESSEE SOCI ETY ON 11-8-2005 BY THE COMMISSIONER OF INCOME-TAX, KOCHI. IN PARA.4 OF THE CERTIFICATE, IT WAS MENTIONED THAT TH E CERTIFICATE WAS NOT A FINDING REGARDING CHARITABLE NATURE OF THE TRUST AND IN PARA 1 IT WAS STATED THAT THE TRUS T WAS ITA NO. 530/COCH/2009 2 REGISTERED AS A RELIGIOUS TRUST. THEREFORE, THE LD . COMMISSIONER HELD THAT 80G RECOGNITION CANNOT BE GI VEN WHEN THE TRUST IS A RELIGIOUS TRUST. 2. ON APPEAL BEFORE US THE ASSESSEES CONTENTION WO ULD BE THAT THE ORDER OF THE LD. COMMISSIONER OF INCOME-TA X DATED 11-08-2005 CLEARLY STATES THAT THE ASSESSEE SATISFI ES ALL THE CONDITIONS FOR REGISTRATION U/S.12AA OF THEE I.T. A CT AS A CHARITABLE TRUST, REGISTRATION IS GRANTED AS A CHAR ITABLE TRUST W.E.F. 24-2-2003. WHEN THAT BEING THE ORDER OF THE LD. COMMISSIONER OF INCOME-TAX WHILE GRANTING REGISTRAT ION U/S.12AA, THE LD. COMMISSIONER IN THE IMPUGNED ORDE R ALLEGES THE CLAIM OF RELIGIOUS TRUST IS THE ARGUMEN T OF THE LD. COUNSEL. THE LD. COUNSEL FURTHER FILED A COPY OF THE ORDER OF THE COMMISSIONER OF INCOME-TAX, KOCHI DATED 11-8- 2005. IN THAT ORDER IT IS STATED THAT AFTER THE AMENDMENT DEED EXECUTED BY THE TRUST ON 24-2-2003 WITH COPY OF THE RESOLUTION PASSED BY THE TRUST, THE TRUST SATISFIES ALL THE CONDITIONS FOR REGISTRATION U/S.12AA OF THE ACT AS A CHARITABLE TRUST, REGISTRATION IS GRANTED AS A CHAR ITABLE TRUST W.E.F.24-2-2003. NOW, IT IS NOT DISPUTED THAT 12A A REGISTRATION HAS BEEN GRANTED AS A CHARITABLE TRUST W.E.F. 24- 2-2003. THE LD. COUNSEL SUBMITTED THAT THE IMPUGNE D ORDER ITA NO. 530/COCH/2009 3 OF THE COMMISSIONER DENYING THE RECOGNITION U/S.80G IS NOT JUSTIFIED, WHICH REQUIRES TO BE ANNULLED AND THE AS SESSEE MAY BE GRANTED THE BENEFIT OF 80G RECOGNITION. 3. IN REPLY THE LD. JR.D.R. SUBMITTED THAT PROVISIO NS OF SECTION 80G AND 12AA ARE MUTUALLY EXCLUSIVE. SECTI ON 80G(5)(III) CLEARLY POSTULATES THE CONDITION THAT T HE INSTITUTION OR FUND IS NOT EXPRESSED TO BE FOR THE BENEFIT OF ANY PARTICULAR RELIGIOUS COMMUNITY OR CAST. THERE FORE, THE LD. JR.D.R. PRAYED FOR UPHOLDING THE ORDER OF THE L D. COMMISSIONER OF INCOME-TAX. 4. WE HAVE CONSIDERED RIVAL SUBMISSIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD INCLUDING THE PRECEDE NTS. THE FACT REQUIRES RE-ADJUDICATION AS THE ORDER OF THE L D. COMMISSIONER OF INCOME-TAX WHILE GRANTING 12AA REGISTRATION IS AMENDED AS A CHARITABLE TRUST W.E.F . 24-2- 2003. IN FACT THERE IS AN AMENDMENT TO THE TRUST DEED/MEMORANDUM RULES AND REGULATIONS. THE COPY O F THE AMENDMENT DEED HAS BEEN FURNISHED FOR OUR PERUSAL. THE AMENDMENT DEED IS DATED 24-2-2003. IT IS THE ADDE NDUM TO TRUST DEED WHEREBY CLAUSE 4(E) OF THE ORIGINAL T RUST DEED WHICH WAS READ AS THE PROVISION FOR MORAL AND RELI GIOUS EDUCATION SHALL STAND AMENDED WITH EFFECT FROM 18 TH DAY OF ITA NO. 530/COCH/2009 4 AUGUST 2002 AND SHALL HEREAFTER BE READ AS FOLLOWS: (E) THE PROVISION FOR MORAL EDUCATION. IN THE SAME WAY OBJECT CLAUSE OF THE TRUST DEED BY WAY OF AMENDMENT DELETED THE WORD AND RELIGIOUS FROM THE SAID CLAUSE AND THEREBY TO AMEND THE TRUST DEED AS DECIDED IN THE MEETING OF T RUSTEES CONVENED ON 18-8-2002 WITH A MAJORITY OF 2/3 RD OF THE MEMBERS. THIS WILL GO TO SHOW THAT THERE IS NO SH ADOW OF RELIGIOUS OR CAST ELEMENT SO AS TO DENY 80G RECOGNI TION. HOWEVER, FOR PROPER ADJUDICATION OF FACTS, WE SET A SIDE THE ORDER OF THE LD. COMMISSIONER OF INCOME-TAX DATED 4 -8-2009 WHEREBY THE LD. CIT(APPEALS) DENIED THE 80G RECOGNI TION AND REMAND THIS ISSUE BACK TO THE FILE OF THE CIT(APPEA LS) FOR PROPER ADJUDICATION ON MERITS, IN THE LIGHT OF THE AMENDED DEED AND AFTER ANALYZING AND VERIFYING THE ACTIVITI ES OF THE TRUST. IT IS NEEDLESS TO MENTION THAT THE ASSES SEE SHOULD AFFORD SUFFICIENT OPPORTUNITY OF BEING HEARD. 5. IN THE RESULT, THE ASSESSEES APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. SD/- SD/- (SANJAY ARORA) (N.VIJAYKUMARAN) ACCOUNTANT MEMBER JUDICIAL M EMBER ERNAKULAM, DATED THE 16 TH JUNE,2011. PM. ITA NO. 530/COCH/2009 5 COPY FORWARDED TO: 1. SAFI(SOCIAL ADVANCEMENT FOUNDATION OF INDIA), RIYAS NAGAR, SIAS BUILDING, VAZHAYUR, MALAPPURA M. 2. THE COMMISSIONER OF INCOME-TAX, CALICUT. 3. D.R.