Hospital Pharmacy Foundation, Delhi V. DIT (Exemptions), Delhi

ITA 5557/DEL/2012

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 1299 (ITAT-DELHI)
• Duration Of Justice: 2 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-01-2013
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: C
• Assessment Year: misc
• Appeal Filed On: 02-11-2012
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SATPAL SINGH
• Assessee Lawyers: P N MEHTA
• Section: 12A; 12AA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL DELHI DELHI DELHI DELHI BENCH BENCH BENCH BENCH C CC C : NEW DELHI : NEW DELHI : NEW DELHI : NEW DELHI BEFORE SHRI G. BEFORE SHRI G. BEFORE SHRI G. BEFORE SHRI G.D.AGRAWAL, D.AGRAWAL, D.AGRAWAL, D.AGRAWAL, VICE PRESIDENT AND VICE PRESIDENT AND VICE PRESIDENT AND VICE PRESIDENT AND SHRI SHRI SHRI SHRI RAJPAL YADAV RAJPAL YADAV RAJPAL YADAV RAJPAL YADAV, JUDICIAL MEMBER , JUDICIAL MEMBER , JUDICIAL MEMBER , JUDICIAL MEMBER ITA NO. ITA NO. ITA NO. ITA NO.5557/DEL/2012 5557/DEL/2012 5557/DEL/2012 5557/DEL/2012 ASSESSMENT YEAR ASSESSMENT YEAR ASSESSMENT YEAR ASSESSMENT YEAR : : : : N.A. N.A. N.A. N.A. HOSPITAL PHARMACY HOSPITAL PHARMACY HOSPITAL PHARMACY HOSPITAL PHARMACY FOUNDATION, FOUNDATION, FOUNDATION, FOUNDATION, S SS S- -- -360, NEW RAJENDER NAGAR, 360, NEW RAJENDER NAGAR, 360, NEW RAJENDER NAGAR, 360, NEW RAJENDER NAGAR, DELH DELH DELH DELHI I I I 110 060. 110 060. 110 060. 110 060. VS. VS. VS. VS. DIRECTOR OF INCOME DIRECTOR OF INCOME DIRECTOR OF INCOME DIRECTOR OF INCOME- -- -TAX TAX TAX TAX (EXEMPTIONS), (EXEMPTIONS), (EXEMPTIONS), (EXEMPTIONS), PLOT NO.15, 3 PLOT NO.15, 3 PLOT NO.15, 3 PLOT NO.15, 3 RD RDRD RD FLOOR, FLOOR, FLOOR, FLOOR, AAYKAR BHAWAN, AAYKAR BHAWAN, AAYKAR BHAWAN, AAYKAR BHAWAN, LAXMI NAGAR DISTRICT CENTRE, LAXMI NAGAR DISTRICT CENTRE, LAXMI NAGAR DISTRICT CENTRE, LAXMI NAGAR DISTRICT CENTRE, DELHI DELHI DELHI DELHI 110 092. 110 092. 110 092. 110 092. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI P.N.MEHTA, CA. RESPONDENT BY : SHRI SATPAL SINGH, SR.DR. ORDER ORDER ORDER ORDER PER G. PER G. PER G. PER G.D.AGRAWAL, D.AGRAWAL, D.AGRAWAL, D.AGRAWAL, VP VPVP VP : : : : THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E ORDER OF LEARNED DIRECTOR OF INCOME-TAX (EXEMPTIONS), DELHI DATED 3 RD SEPTEMBER, 2012. 2. IN THIS APPEAL, FOLLOWING GROUNDS ARE RAISED BY THE ASSESSEE :- 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE DIRECTOR OF INCOME TAX (EXEMPTIONS) IS WRONG IN REJ ECTING THE APPLICATION OF THE ASSESSEE TRUST UNDER SECTION 12AA(1)(B) OF THE INCOME TAX ACT, 1961. 2. THE DIRECTOR OF INCOME TAX (EXEMPTIONS) IS WRONG IN COMING TO THE CONCLUSION THAT THE ASSESSEE TRUST IS NOT ENGAGED IN THE CHARITABLE ACTIVITY/GENUINENESS OF T HE ACTIVITY AS STIPULATED IN SECTION 12AA(1)(B) OF THE INCOME TAX ACT. 3. THE DIRECTOR OF INCOME TAX (EXEMPTIONS) IS WRONG IN REJECTING THE APPLICATION UNDER SECTION 12AA BASED ON THE DECISION OF THE HONBLE KERALA HIGH COURT (2001) 24 7 ITR ITA-5557/DEL/2012 2 PAGE 18 AS THE SAID CASE WAS DECIDED BY THE HONBLE COURT ON ITS OWN FACTS. 4. THE ORDER PASSED BY THE DIRECTOR OF INCOME TAX (EXEMPTIONS) IS AGAINST THE LAW AND FACTS OF THE CA SE. 3. AT THE TIME OF HEARING BEFORE US, IT WAS STATED BY THE LEARNED COUNSEL FOR THE ASSESSEE THAT LEARNED DIT(EXEMPTION S) HAS REFUSED THE REGISTRATION TO THE ASSESSEE TRUST MAINLY ON THE GR OUND THAT THE ASSESSEE TRUST HAS NOT STARTED THE CHARITABLE ACTIV ITY. THEREFORE, IT HAS NOT FULFILLED THE CONDITION LAID DOWN FOR GRANT OF REGISTRATION UNDER SECTION 12A OF THE INCOME-TAX ACT, 1961. HE STATED THAT THE ASSESSEE TRUST WAS A NEWLY CREATED TRUST AND THEREFORE, THE CHARITABLE ACTIVITY OF THE TRUST HAS NOT COMMENCED. HE FURTHER SUBMITTED THAT FOR THE PURPOSE OF REGISTRATION UNDER SECTION 12A, IT IS NO T A NECESSARY CONDITION THAT THE TRUST SHOULD HAVE COMMENCED THE CHARITABLE ACTIVITY. HE, THEREFORE, SUBMITTED THAT THE REGIST RATION SHOULD BE GRANTED TO THE ASSESSEE TRUST. 4. THE LEARNED DR, ON THE OTHER HAND, POINTED OUT T HAT THE DIT(EXEMPTIONS) VIDE LETTER DATED 26.04.2012 ASKED THE ASSESSEE TO SUBMIT VARIOUS DOCUMENTS/EXPLANATION, THE DETAILS O F WHICH ARE GIVEN AT PAGE 1 OF THE ORDER PASSED UNDER SECTION 12A OF THE IT ACT. THAT THE ASSESSEE ONLY MADE PART COMPLIANCE OF THE SAID LETT ER AND TOOK ADJOURNMENT FOR SUBMITTING THE REMAINING EVIDENCE/E XPLANATION. DESPITE SEEKING REPEATED ADJOURNMENTS, THE ASSESSEE DID NOT FURNISH THE REMAINING DETAILS/EXPLANATION, THEREFORE, THE D IT(EXEMPTIONS) RIGHTLY REFUSED REGISTRATION TO THE ASSESSEE TRUST. 5. THE LEARNED COUNSEL FOR THE ASSESSEE, IN THE REJ OINDER, STATED THAT THE DETAILS ASKED FOR BY THE DIT(EXEMPTIONS) W ERE FOR GIVING EVIDENCE WITH REGARD TO CHARITABLE ACTIVITY CARRIED ON BY THE ASSESSEE. SINCE THOSE ACTIVITIES WERE NOT CARRIED ON, THE SAM E COULD NOT BE ITA-5557/DEL/2012 3 FURNISHED. HE, THEREFORE, REITERATED THAT LEARNED DIT(EXEMPTIONS) SHOULD BE DIRECTED TO GRANT REGISTRATION TO THE ASS ESSEE TRUST. 6. WE HAVE CAREFULLY CONSIDERED THE ARGUMENTS OF TH E BOTH THE SIDES AND PERUSED THE MATERIAL PLACED BEFORE US. I N OUR OPINION, IT IS THE DUTY OF THE ASSESSEE TO FURNISH THE DETAILS/EXP LANATION ASKED FOR BY THE LEARNED DIT(EXEMPTIONS). IF THE CHARITABLE ACT IVITY HAS NOT BEEN COMMENCED, THE ASSESSEE SHOULD MENTION THIS FACT TO THE DIT(EXEMPTIONS). HOWEVER, THIS WOULD NOT BE A GROU ND FOR NOT COMPLYING WITH THE LETTER ISSUED BY THE DIT(EXEMPTI ONS). AFTER CONSIDERING THE FACTS OF THE CASE AND ARGUMENTS OF BOTH THE SIDES, IN OUR OPINION, IT WOULD MEET THE ENDS OF JUSTICE IF T HE ORDER OF LEARNED DIT(EXEMPTIONS) IS SET ASIDE AND THE MATTER IS REST ORED TO HIS FILE WITH THE DIRECTION TO THE ASSESSEE TO MAKE PROPER COMPLI ANCE WITH THE LETTER OF DIT(EXEMPTIONS) DATED 26 TH APRIL, 2012. WE ORDER ACCORDINGLY AND SET ASIDE THE ORDER PASSED UNDER SECTION 12A OF THE INCOME-TAX ACT AND RESTORE THE MATTER TO THE FILE OF THE DIT(E XEMPTIONS). WE DIRECT THE ASSESSEE TO MAKE PROPER COMPLIANCE TO TH E DIT(EXEMPTIONS)S LETTER DATED 26 TH APRIL, 2012. WE ALSO DIRECT THE DIT(EXEMPTIONS) TO ALLOW ADEQUATE OPPORTUNITY OF BE ING HEARD TO THE ASSESSEE. THEREAFTER, HE WILL PASS THE ORDER IN AC CORDANCE WITH LAW. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS TRE ATED AS ALLOWED FOR STATISTICAL PURPOSES. DECISION PRONOUNCED IN THE OPEN COURT ON 4 TH JANUARY, 2013. SD/- SD/- ( (( (RAJPAL YADAV RAJPAL YADAV RAJPAL YADAV RAJPAL YADAV) )) ) (G.D.AGRAWAL) (G.D.AGRAWAL) (G.D.AGRAWAL) (G.D.AGRAWAL) JUDICIAL JUDICIAL JUDICIAL JUDICIAL MEMBER MEMBER MEMBER MEMBER VICE PRESIDENT VICE PRESIDENT VICE PRESIDENT VICE PRESIDENT DATED : 04.01.2013 VK. ITA-5557/DEL/2012 4 COPY FORWARDED TO: - 1. APPELLANT : HOSPITAL PHARMACY FOUNDATION, HOSPITAL PHARMACY FOUNDATION, HOSPITAL PHARMACY FOUNDATION, HOSPITAL PHARMACY FOUNDATION, S SS S- -- -360, NEW RAJENDE 360, NEW RAJENDE 360, NEW RAJENDE 360, NEW RAJENDER NAGAR, R NAGAR, R NAGAR, R NAGAR, DELHI DELHI DELHI DELHI 110 060. 110 060. 110 060. 110 060. 2. RESPONDENT : DIRECTOR OF INCOME DIRECTOR OF INCOME DIRECTOR OF INCOME DIRECTOR OF INCOME- -- -TAX (EXEMPTIONS), TAX (EXEMPTIONS), TAX (EXEMPTIONS), TAX (EXEMPTIONS), PLOT NO.15, 3 PLOT NO.15, 3 PLOT NO.15, 3 PLOT NO.15, 3 RD RDRD RD FLOOR, AAYKAR BHAWAN, FLOOR, AAYKAR BHAWAN, FLOOR, AAYKAR BHAWAN, FLOOR, AAYKAR BHAWAN, LAXMI NAGAR DISTRICT CENTRE, DELHI LAXMI NAGAR DISTRICT CENTRE, DELHI LAXMI NAGAR DISTRICT CENTRE, DELHI LAXMI NAGAR DISTRICT CENTRE, DELHI 110 092. 110 092. 110 092. 110 092. 3. CIT 4. CIT(A) 5. DR, ITAT ASSISTANT REGISTRAR