Presentation Social Service Centre,., Hyd, Warangal V. DDIT (Exemptions)-II, Hyderabad, Hyderabad

ITA 592/HYD/2015

• Counselvise Citation: 59222514 RSA 2015
• Duration Of Justice: 5 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-11-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 16-09-2015
• Assessment Year: 2011-2012
• Appeal Filed On: 08-05-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: G SURYA PRASAD
• Keywords: Charitable institution; Maximum Marginal Rate; Additional evidence; Question of law
• Section: 143(3); 12AA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH B, HYDERABAD BEFORE SHRI P.MADHAVI DEVI, JUDICIAL MEMBER AND SHRI S. RIFAUR RAHMAN, ACCOUNTANT MEMBER ITA NO. 592/HYD/2015 ASSESSMENT YEAR: 2011-12 M/S PRESENTATION SOCIAL SERVICE CENTRE, FATIMA NAGAR, REC (POST), WARANGAL. PAN AAGFP 1453 Q VS. DDIT (EXEMPTIONS) II, HYDERABAD (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI G.V.N. HARI REVENUE BY : SHRI G. SURYA PRASAD DATE OF HEARING : 16-09-2015 DATE OF PRONOUNCEMENT : 04-11-2015 O R D E R PER S. RIFAUR RAHAMAN, A.M.: THIS APPEAL BY ASSESSEE IS DIRECTED AGAINST THE OR DER DATED 06/02/2015 OF LD. CIT(A) 9, HYDERABAD FOR THE AY 2011-12. 2. BRIEFLY THE FACTS ARE, ASSESSEE IS A SOCIETY REG ISTERED U/S 12AA. ASSESSEE FILED ITS RETURN OF INCOME ON 07/09/2011 D ECLARING NIL INCOME. ASSESSEE ACCUMULATED A SUM OF RS. 85,00,00 0 U/S 11(2). AS PER FORM 10 FILED ALONG WITH THE RETURN, ASSESSE E STATED THE PURPOSE OF ACCUMULATION AS TO BE UTILIZED FOR SOCI AL-ECONOMIC PROGRAMS. AO HELD THAT IT WAS NOT SUFFICIENT COMPL IANCE FOR THE ASSESSEE TO STATE A GENERAL AND VAGUE ACTIVITY WHIC H IS NOT COVERED BY ITS AIMS AND OBJECTIVES IN THE FORM 10, THAT WHI LE PLURALITY OF PURPOSE WAS PERMITTED BUT THESE PURPOSES HAD TO BE SPECIFIC, REALISTIC AND DEFINITE AND THAT IT WAS ONLY BY MENTIONING THE OBJECT SPECIFICALLY WOULD THE AO BE ENABLED TO MONITOR ITS UTILIZATION. TO COME TO THE 2 ITA NO. 592 /HYD/2015 PRESENTATION SOCIAL SERVICE CENTRE AFORESAID CONCLUSION, HE RELIED ON FEW CASE LAWS. A O FINALLY HELD THAT IN VIEW OF THE FAILURE OF THE ASSESSEE TO FURNISH S PECIFIC PURPOSE OF ACCUMULATION IN THE FORM 10, BROUGHT THE SUM OF RS. 85,00,000 ACCUMULATED BY ASSESSEE TO TAX. 3. AGGRIEVED BY THE ORDER OF AO, ASSESSEE PREFERRED APPEAL BEFORE CIT(A). 4. IN THE COURSE OF APPELLATE PROCEEDINGS, ASSESSEE SUBMITTED THAT AO HAD FAILED TO INTERPRET THE JUDICIAL DECISIONS C ITED BY HIM THAT IN CASE OF TRUSTEES OF SINGHANIA CHARITABLE TRUST, IT WAS CLEARLY HELD THAT THE LEGISLATURE WOULD NOT HAVE THOUGHT OF THE NEED FOR SPECIFICATION OF THE PURPOSE IF IT DID NOT HAVE IN MIND THE PARTICULARLY OF PURPOSE, THAT THE EXPENDITURE OUT OF THE ACCUMUL ATED FUNDS HAD BEEN TOTALLY WITHIN THE OBJECTS OF THE ASSESSEE, TH AT THIS WAS CLEAR FROM THE DATA AVAILABLE AS PER THE RETURN FOR THE S UCCEEDING AY 2011- 12 AND THAT IN MATTERS OF TAXATION, SUBSTANCE AND N OT ONLY FORM, MUST BE LOOKED AT FOR ASCERTAINING THE REAL NATURE OF TH E TRANSACTION. FOR THIS PROPOSITION, ASSESSEE RELIED ON THE DECISION I N THE CASE OF CIT VS. 21 ST SOCIETY OF IMMACULATE CONCEPTION, [2000] 241 ITR 1 93 (MAD.). 5. THE CIT(A) AFTER EXAMINING THE FACTS OF THE CASE WITH CASE LAWS CONFIRMED THE ACTION OF THE AO IN BRINGING THE AMOU NT OF RS. 85,00,000 TO TAX, BY OBSERVING AS UNDER: 7.9 IN THE FIRST PLACE, THE COPY OF THE RESOLUTION FILED ALONG WITH THE FORM 10 AND THE ONE FILED AS ADDITIONAL EVIDENCE A RE MATERIALLY DIFFERENT. THE PHRASE USED IN THE RESOLUTION FILED AS ADDITIONAL EVIDENCE IS 'TO BE UTILIZED FOR THE FOLLOWING SOCIO- ECONOM IC PROGRAMMES' WHEREAS THE PHRASE USED IN THE RESOLUTION FILED ALONG WIT H FORM 10 WAS MERELY 'TO BE GENERIC DESCRIPTION WHAT WAS TO FOLLOW. TH E PHRASE USED IN LATTER WAS MEANT AS AN END, AN OBJECT AND THE PUR POSE IN ITSELF. AS HELD EARLIER, SUCH A GENERALIZED PURPOSE AMOUNTED TO ST ATING THAT THE FUNDS WERE TO BE USED FOR CHARITABLE PURPOSE AND HAD NO MEANING RENDERING THE PROVISIONS OF SECTION 11(2) OTIOSE. 7.10 SECONDLY, THE CRUCIAL OMISSION OF THE WORD ' FOLLOWING' AND THE DETAILED LIST OF PURPOSES FOR WHICH THE FUNDS WERE TO BE UTILIZED IN THE RESOLUTION FILED ALONG WITH THE FORM 10 RENDERS T HE VERACITY OF THE ADDITIONAL EVIDENCE SUSPECT. 3 ITA NO. 592 /HYD/2015 PRESENTATION SOCIAL SERVICE CENTRE 7.11 THIRDLY, THE REASON PUT FORTH BY THE' APPELLA NT FOR THE FAILURE TO FURNISH THE DETAILS OF THE PURPOSE OF UTILIZATION, DESPITE CLAIMING TO HAVE INCLUDED ITS RESOLUTION, IS THAT THE APPELLANT CO ULD NOT TYPE ALL THESE ITEMS IN THE FORM 10. THE COMPLETE RELEVANT EXTRA CTS OF THE RESOLUTION, AS PER THE ADDITIONAL EVIDENCE FILED, HAS BEEN REPRODUCED ABOVE. AS CAN BE SEEN, IT BARELY RUNS INTO ONE TY PED SHEET. THE APPELLANT HAS FAILED TO EXPLAIN WHY THIS COULD NOT HAVE BEE N TYPED, PARTICULARLY WHEN THE APPELLANT HAS THOUGHT NOTHING OF FILING GROUNDS OF APPEAL RUNNING INTO SEVEN SHEETS. INDEED, THE APPELLANT H AD ENCLOSED COPY OF THE RESOLUTION TO THE FORM 10. THE APPELLANT HA S FAILED TO EXPLAIN WHY A PHOTOCOPY OF THE RESOLUTION COULD NOT HAVE BEEN ENCLOSED. 7.12 FOURTHLY, FORM 10 IS MEANT TO ASSIST THE ASSE SSING OFFICER IN ADMINISTERING THE PROVISIONS OF THE ACT SMOOTHLY. FORM 10 IS, THEREFORE, A SELF-CONTAINED DOCUMENT DULY SETTING DOWN THE FULL DETAILS OF THE PURPOSES FOR WHICH THE FUNDS ARE MEANT TO BE UTIL IZED. FILING OF FORM 10 IN THE CAVALIER FASHION, AS DONE BY THE APPELLANT , DEFEATS THE PURPOSE OF FILING IT SINCE THE ASSESSING OFFICER CANNOT THEN BE AWARE OF ALL THAT MAY BE RECORDED IN THE RESOLUTIONS BU T NOT REVEALED IN THE FORM, EXCEPT WHEN THE ASSESSING OFFICER GOES PROB ING IT SPECIFICALLY. HAD IT BEEN THE INTENTION OF THE STATUTE TO MAKE THE INFORMATION AVAILABLE TO THE ASSESSING OFFICER ONLY WHEN ASKE D FOR, THERE WOULD HAVE BEEN NO NEED TO PROVIDE FOR THE FILING OF FOR M 10 AT ALL. 6. STILL AGGRIEVED, THE ASSESSEE IS IN APPEAL BEFO RE US RAISING THE FOLLOWING GROUNDS OF APPEAL: 1. THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) IS CONTRARY TO THE FACTS AND ALSO THE LAW APPLICABLE TO THE FACTS OF THE CASE. 2. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS ) IS NOT JUSTIFIED IN SUSTAINING THE ADDITION OF RS.85,00,000/- MADE BY THE ASSESSING OFFICER TOWARDS DENIAL OF EXEMPTION U/S 11(2) IN RESPECT OF AMOUNT ACCUMULATED ON THE GROUND THAT THE PURPOSES MENTI ONED IN FORM NO.10 ARE GENERAL AND NOT SPECIFIC. 3. WITHOUT PREJUDICE TO THE ABOVE, THE LEARNED COM MISSIONER OF INCOME TAX (APPEALS) OUGHT TO HAVE HELD THAT THE A SSESSING OFFICER IS NOT JUSTIFIED IN SUBJECTING THE INCOME OF THE APPE LLANT TO TAX AT THE MAXIMUM MARGINAL RATE. 7. LD. AR SUBMITTED THAT THE INTENTION OF THE TRUST IS TO UTILIZE THE ACCUMULATED FUNDS IN SOCIO-ECONOMICAL PROGRAMMES. H E EXPLAINED THAT THE TERM SOCIO DENOTES THE UPLIFTMENT OF SOC IALLY BACKWARD CLASS AND ECONOMICAL DENOTES ECONOMICALLY BACKWARD CLAS S I.E. POOR PEOPLE. BOTH THESE ARE THE MAIN OBJECTS OF THE TRUS T. HENCE, TERM USED ARE PERFECTLY WITHIN ITS OBJECTS. LD. AR ALSO SUBMITTED THAT THE ASSESSEE WAS REGULARLY FOLLOWING THE ACCUMULATION A ND APPLICATION OF FUNDS OVER A PERIOD OF TIME AS BELOW: 4 ITA NO. 592 /HYD/2015 PRESENTATION SOCIAL SERVICE CENTRE A) EVERY FINANCIAL YEAR, IT SETS ASIDE UNUTILIZED FUNDS DURING THE YEAR BY PASSING RESOLUTION IN THE COMMITTEE AND FI LING FORM 10 ACCORDINGLY. B) IN THE NEXT FINANCIAL YEAR, THE WHOLE SUM IS UT ILIZED AS APPLICATION FOR THE OBJECTS OF THE TRUST. HE SUBMITTED TWO YEARS RETURN OF INCOME AS PROOF FO R SUCH TREATMENT. IT ALSO INCLUDES THE AY IN QUESTION: STATEMENT OF TOTAL INCOME FOR AY 2011-12 I RECEIPTS 1. VOLUNTARY CONTRIBUTIONS 2. BANK INTEREST 3. OTHER INCOME 20025585.00 1145725.00 2325170.00 23496480.00 GROSS RECEIPTS LESS: AMOUNT SET ASIDE U/S 11(2) OF IT ACT 1961 AS PER RESOLUTION PASSED ON 22.04.2011 23496480.00 8500000.00 II UTILISATION: 1. ON REVENUE ACCOUNT 2. ON CAPITAL ACCOUNT 19488244.00 145371.00 14996480.00 19633615.00 UTILISATION LESS: AMOUNT SET ASIDE U/S 11(2) OF IT ACT AS PER RESOLUTION PASSED ON 11/04/10 19633616.00 6500000.00 13133615.00 NET SURPLUS 1862865.00 REFUND DUE 89600.00 STATEMENT OF TOTAL INCOME FOR AY 2012-13 I RECEIPTS 1. VOLUNTARY CONTRIBUTIONS 2. BANK INTEREST 19215064.00 1065946.00 1755456.00 22036466.00 5 ITA NO. 592 /HYD/2015 PRESENTATION SOCIAL SERVICE CENTRE 3. OTHER INCOME GROSS RECEIPTS LESS: AMOUNT SET ASIDE U/S 11(2) OF IT ACT 1961 AS PER RESOLUTION PASSED ON 09.04.2012 22036466.00 2300000.00 II UTILISATION: 1. ON REVENUE ACCOUNT 2. ON CAPITAL ACCOUNT 23397041.00 1957915.00 19736466.00 25354956.00 UTILISATION LESS: AMOUNT SET ASIDE U/S 11(2) OF IT ACT AS PER RESOLUTION PASSED ON 11/04/10 25354956.00 8500000.00 16854956.00 NET SURPLUS 2881510.00 REFUND DUE 66375.00 LD. AR ALSO RELIED ON THE DECISION OF HONBLE NEW D ELHI HIGH COURT DECISION IN THE CASE OF DIRECTOR OF INCOME-TAX VS. NBIE WELFARE SOCIETY, [2015] 370 ITR 490. 7.1 LD. AR SUBMITTED THAT ASSESSMENT ORDER OF AY 20 12-13, WAS ACCEPTED BY THE DEPARTMENT WITHOUT ANY ADVERSE OBSE RVATION AND, THEREFORE, IT IS CLEAR THAT THE ACCUMULATION WAS AP PLIED TO CARRY OUT THE OBJECTS OF THE TRUST SINCE THE AO HAS PASSED TH E 143(3) ORDER. HENCE, THE ASSESSEE HAS UTILIZED THE WHOLE ACCUMULA TION SET APART IN THE AY 2011-12. THERE IS NO DISPUTE THAT THE APPLIC ATION OF THE ACCUMULATION WAS ONLY FOR THE CARRYING OUT THE OBJE CTS OF THE TRUST. 7.2 LD. DR RELIED ON THE ORDER OF CIT(A) AND STRESS ED THAT THE PURPOSE OF ACCUMULATION HAS TO BE FOR SPECIFIC OBJE CT OF THE TRUST AND NOT ON GENERAL OBJECTS. 8. HEARD ARGUMENTS OF BOTH THE SIDES. THE AO AND LD . CIT(A) HAVE RELIED ON VARIOUS CASE LAWS ON THE ASPECT OF ACCUMU LATION OF FUNDS FOR CARRYING OUT THE OBJECTS OF THE TRUST AND THE OBJEC TS HAS TO BE SPELT 6 ITA NO. 592 /HYD/2015 PRESENTATION SOCIAL SERVICE CENTRE OUT CLEARLY IN THE FORM 10 TO BE FILED BY THE ASSES SEE. THERE IS NO DOUBT THAT THE ASSESSEE HAS FILED FORM 10 AS PER PR OCEDURE AND WITHIN THE TIME U/S 11(2) OF THE ACT. THE ASSESSEE HAS TO FILE THE FORM 10 WITH THE CLEAR OBJECTS AND NOT WITH THE VAGUE TERMS . THE JUDGMENTS WERE IN FAVOUR OF THE DEPARTMENT. 8.1 WE ARE OF THE VIEW THAT THE TRUSTS ARE ALLOWED TO ACCUMULATE FUNDS FOR CREATING LONG TERM ASSETS TO CARRY OUT TH E MAIN OBJECTS OF THE TRUST LIKE BUILDINGS, BUYING LANDS/ BUILDINGS E TC. IN SUCH CASES, THE TRUST HAS TO SPECIFY CLEARLY WHY THEY ARE ACCUM ULATING HUGE FUNDS AND ALSO OVER A PERIOD OF TIME SAY 5 10 YEARS. IN THESE CASES, THE AO MAY NOT BE ABLE TO MONITOR THE CASES, HENCE, IT IS IMMINENT TO MENTION THE OBJECTS CLEARLY IN THE FORM 10. 8.2 IN THE PRESENT CASE, AS PER THE RECORDS AVAILAB LE, THE ASSESSEE HAS ACCUMULATED THE FUNDS AND FOLLOWED THE PROCEDUR E FOR ACCUMULATION AS PER THE PROVISIONS OF THE ACT, SINC E, THE OBJECT TO ACCUMULATE THE FUNDS WERE FOR ANCILLARY OBJECTS, W HICH ARE PART OF THE MAIN OBJECTS. IT IS CONTENDED BY THE LD. AR THAT T HE ASSESSEE WAS NOT IN A POSITION TO SPELT OUT EVERY THING IN THE FORM 10. HENCE, THEY HAVE SPECIFIED AS SOCIO ECONOMIC PURPOSE. IT IS ALSO S TATED BY THE LD. AR THAT IT IS THE REGULAR PRACTICE OF THE ASSESSEE THA T IT WILL CONVENE THE BOARD OF TRUSTEES AND EXCESS FUNDS WHICH ARE UNUTIL IZED IN THE FINANCIAL YEAR ARE ACCUMULATED AND APPLIED IN THE I MMEDIATE FOLLOWING FINANCIAL YEAR. IT IS EVIDENT FROM THE RETURN OF IN COME FILED BY THE LD. AR AS ABOVE. THE ACCUMULATED FUNDS OF AY 2009-10 AR E APPLIED IN AY 2010-11. SIMILARLY, ACCUMULATED SUM OF RS. 85,00 ,000 IN AY 2011- 12 ARE APPLIED IN THE AY 2012-13. THIS WAS VERIFIED AND ASSESSMENT ORDER U/S 143(3) WAS PASSED IN THE AY 2012-13. IT I S VERY CLEAR THAT THE ASSESSEE HAS ACCUMULATED FUNDS IN THE AY 2011-1 2 AND APPLIED THE SAME FOR THE OBJECTS OF THE TRUST IN THE IMMEDI ATELY FOLLOWING AY 2012-13. THE PROVISIONS OF SECTION 11(2) READ AS UN DER: 11. [(2) [WHERE [EIGHTY-FIVE] PER CENT OF THE INCOME REFERRED TO IN CLAUSE (A) OR CLAUSE (B) OF SUB-SECTION (1) READ WITH THE EXP LANATION TO THAT SUB-SECTION IS 7 ITA NO. 592 /HYD/2015 PRESENTATION SOCIAL SERVICE CENTRE NOT APPLIED, OR IS NOT DEEMED TO HAVE BEEN APPLIED , TO CHARITABLE OR RELIGIOUS PURPOSES IN INDIA DURING THE PREVIOUS YEAR BUT IS ACCUMULATED OR SET APART, EITHER IN WHOLE OR IN PART, FOR APPLICATION TO SUCH PURP OSES IN INDIA, SUCH INCOME SO ACCUMULATED OR SET APART SHALL NOT BE INCLUDED IN THE TOTAL INCOME OF THE PREVIOUS YEAR OF THE PERSON IN RECEIPT OF THE INC OME, PROVIDED THE FOLLOWING CONDITIONS ARE COMPLIED WITH, NAMELY:] (A) SUCH PERSON SPECIFIES, BY NOTICE IN WRITING GI VEN TO THE 42 [ASSESSING] OFFICER IN THE PRESCRIBED MANNER, THE PURPOSE FOR WHICH THE INCOME IS BEING ACCUMULATED OR SET APART AND THE PERIOD FOR WHICH THE INCOME IS TO BE ACCUMU LATED OR SET APART, WHICH SHALL IN NO CASE EXCEED TEN YEARS; [(B) THE MONEY SO ACCUMULATED 46 OR SET APART IS INVESTED OR DEPOSITED IN THE FORMS OR MODES SPECIFIED IN SUB-SECTION (5)]:] [ PROVIDED THAT IN COMPUTING THE PERIOD OF TEN YEARS REFERRED TO IN CLAUSE (A), THE PERIOD DURING WHICH THE INCOME COULD NOT BE AP PLIED FOR THE PURPOSE FOR WHICH IT IS SO ACCUMULATED OR SET APART, DUE TO AN ORDE R OR INJUNCTION OF ANY COURT, SHALL BE EXCLUDED:] [ PROVIDED FURTHER THAT IN RESPECT OF ANY INCOME ACCUMULATED OR SET APART ON OR AFTER THE 1ST DAY OF APRIL, 2001, THE PROVISION S OF THIS SUB-SECTION SHALL HAVE EFFECT AS IF FOR THE WORDS TEN YEARS AT BOTH THE PLACE S WHERE THEY OCCUR, THE WORDS FIVE YEARS HAD BEEN SUBSTITUTED.] [EXPLANATION.ANY AMOUNT CREDITED OR PAID, OUT OF INCOME REFERRED TO IN CLAUSE (A) OR CLAUSE (B) OF SUB-SECTION (1), READ WITH THE EXPLANATION TO THAT SUB- SECTION, WHICH IS NOT APPLIED, BUT IS ACCUMULATED OR SET APART, TO ANY TRUST OR INSTITUTION REGISTERED UNDER SECTION 12AA OR TO ANY FUND OR INSTITUTION OR TRUST OR ANY UNIVERSITY OR OTHER EDUCATIONAL INSTITUTION O R ANY HOSPITAL OR OTHER MEDICAL INSTITUTION REFERRED TO IN SUB-CLAUSE (IV) OR SUB- CLAUSE (V) OR SUB-CLAUSE (VI) OR SUB- CLAUSE (VIA) OF CLAUSE (23C) OF SECTION 10 , SHALL NOT BE TREATED AS APPLICATION OF INCOME FOR CHARITABLE OR RELIGIOUS PURPOSES, EI THER DURING THE PERIOD OF ACCUMULATION OR THEREAFTER.] 8.3 FROM THE ABOVE SECTION, IT IS EVIDENT THAT THE ASSESSEE CAN ACCUMULATE THE FUNDS FOR THE PURPOSE OF UTILIZING T HE FUNDS FOR THE OBJECTS OF THE TRUST. IT CAN BE FOR THE LONG TERM A S WELL AS SHORT TERM LIKE UTILIZING THEM IN IMMEDIATELY FOLLOWING AY. TH E RELEVANT QUESTION WOULD BE, WHETHER THE ACCUMULATED FUNDS WERE APPLIE D FOR THE OBJECTS OF THE TRUST IN INDIA. IN THE PRESENT CASE, THE ACC UMULATED FUNDS WERE APPLIED FOR THE OBJECTS OF THE TRUST. 8.4 IN THE CASE RELIED UPON BY THE LD. AR I.E. DIT VS. NBIE WELFARE SOCIETY, [2015] 370 ITR 490 (DELHI), THE HONBLE DE LHI HIGH COURT HAS HELD AS UNDER: 9. IN THE PRESENT CASE, THE ASSESSING OFFICER HIM SELF HAD NOTED IN THE ASSESSMENT ORDER THAT THE AIM AND OBJECTIVE OF THE ASSESSEE WAS TO WORK FOR THE WELFARE OF THE EMPLOYEES OF NEW BANK OF IN DIA. THIS UNDOUBTEDLY WAS THE PURPOSE AND OBJECTIVE OF THE SOCIETY. THER EFORE, DURING THE COURSE OF ASSESSMENT PROCEEDING AS IS APPARENT FROM THE A PPELLATE PROCEEDINGS, 8 ITA NO. 592 /HYD/2015 PRESENTATION SOCIAL SERVICE CENTRE THE ASSESSEE HAS CLARIFIED AND STATED THAT THE MON EY IN QUESTION WOULD ONLY BE USED FOR THE PURPOSE OF MAKING PAYMENTS TO THE MEMBERS OR THEIR LEGAL REPRESENTATIVES IN CASE OF THEIR DEATH, RETIREMENT OR PERMANENT DISABILITY. THE TRIBUNAL IN THE IMPUGNED ORDER HAS ALSO REFERR ED TO THE SCHEME FLOATED BY THE RESPONDENT ASSESSEE UNDER WHICH THE EMPLOYE ES WHO WERE DESIROUS OF BECOMING MEMBERS HAD TO DEPOSIT RS.10/- AS ADMI SSION FEES AND THEREAFTER PAY RS.25/- PER MONTH FOR A PERIOD OF 2 5 YEARS. THE SCHEME DEVISED PROVIDED:- PRESENT SCHEME MEMBERSHIP : MEMBERSHIP OF THE SOCIETY SHALL BE OPE N TO THE PERMANENT EMPLOYEES OF NEW BANK OF INDIA. ANY EMPLOYEE DESIRO US OF BECOMING MEMBER MAY APPLY ON THE PRESCRIBED FORM ON PAYMENT OF RS.10/- AS ADMISSION FEE, DULY RECOMMENDED BY ANY OF THE OFFIC E BEARER OR MANAGING COMMITTEE MEMBER OF THE SOCIETY EMPLOYEES APPOINTED ON PART-TIME BASIS AND 1/3RD OR 2/3RD SALARY ARE NOT ELIGIBLE FOR MEMB ERSHIP. SUBSCRIPTION : UNDER THE PRESENT SCHEME, EVERY MEMB ER SHALL SUBSCRIBE A SUM OF RS.25/- PER MONTH FOR A PERIOD OF 25 YEARS. BENEFITS: (A) IN CASE OF DEATH : (I) MEMBERS IN THE AGE GROUP OF BELOW 50 YEARS (AS ON 31-7-85) WILL BE ENTITLED TO THE FOLLOWING BENEFITS:- (A) A SUM OF RS.500/- P.M. SHALL BE PAID TO THE NOM INEE OF THE DECEASED MEMBER FOR A PERIOD OF 15 YEARS. (B) LUMP SUM ADDITIONAL PAYMENT OF RS.15,000/- SHAL L BE MADE TO THE NOMINEE OF THE DECEASED MEMBER IN ADDITION IN THE B ENEFIT REFERRED ABOVE IF THE MEMBER DIES DURING THE PERIOD OF SERVICE IN THE BANK. (II) MEMBERS IN THE AGE GROUP OF ABOVE 50 YEARS (AS ON 31-07-1985) WILL BE ENTITLED TO THE FOLLOWING BENEFITS:- (A) A SUM OF RS.500/- P.M. SHALL BE PAID TO THE NOM INEE OF THE DECEASED MEMBER TILL THE AGE OF RETIREMENT WITH A MINIMUM PE RIOD OF 5 YEARS. (B) A LUMPSUM PAYMENT OF RS.15,000/- SHALL BE MADE TO THE NOMINEE OF THE DECEASED MEMBER IN ADDITION TO THE BENEFIT REFERRED ABOVE (II-A) IF THE MEMBER DIES DURING THE PERIOD OF SERVICE IN THE BAN K. OTHER BENEFITS ARE ALSO THERE WHICH ARE IN CASE OF RETIREMENT AND THES E HAVE BEEN GIVEN IN PART B OF THIS SCHEME TO THE EXTENT THAT A SUM OF RS.5 00/- PER MONTH SHALL BE PAID TO THE MEMBERS AS PER CALCULATION GIVEN IN THE SAME. FURTHER, OTHER BENEFITS IN THE CASES OF DEATH AND PERMANENT DISABI LITY HAVE ALSO BEEN GIVEN. LASTLY, BENEFIT HAVE BEEN GIVEN ON RESIGNATI ON FROM BANK PRIOR TO THE RETIREMENT. THE CONTENTION OF THE LEARNED COUNSEL I S THAT THIS IS THE ONLY OBJECT OF THE ASSESSEE AND THERE ARE NO PLURALITY O F THE OBJECTS AND AS SUCH IF THE ASSESSEE HAD MENTIONED IN FORM NO. 10 THAT T HE ACCUMULATION OF THE FUNDS W0ERE FOR FURTHER UTILIZATION THE VERY PURP OSE IS TO UTILIZE THE AMOUNT OF ACCUMULATION FOR FURTHER BENEFITS TO BE GIVEN TO THE MEMBERS IN THE CASE OF DEATH, RETIREMENT, PERMANENT DISABILITY...... 9 ITA NO. 592 /HYD/2015 PRESENTATION SOCIAL SERVICE CENTRE 10. OTHER BENEFITS WHICH WERE SPECIFIED IN PART (B ) OF THE SCHEME, WHICH STIPULATED THAT A SUM OF RS.500/- SHALL BE PAID TO THE MEMBERS ON THE EVENT SPECIFIED THEREIN. 11. THE AFORESAID CONTENTION HAS BEEN ACCEPTED BY THE TRIBUNAL. THE FINDINGS RECORDED ARE IN CONSONANCE WITH RATIO OF SEVERAL DECISIONS OF THIS COURT. 12. IN VIEW OF THE FACTUAL BACKGROUND, THE SUBSTAN TIAL QUESTION OF LAW IN TERMS OF THE DECISIONS OF THIS COURT HAS TO BE ANS WERED IN FAVOUR OF RESPONDENT ASSESSEE AND AGAINST THE APPELLANT. THE APPELLANT REVENUE, IS NOT ENTITLED TO SUCCEED. THE APPEAL IS DISPOSED OF . THERE WILL BE NO ORDER AS TO COSTS. 8.5 FROM THE ABOVE, IT IS PERTINENT TO NOTE THAT EV EN IN THE PRESENT CASE, THERE IS NO DISPUTE THAT THE FUNDS ACCUMULATE D WERE UTILIZED FOR CARRYING OUT THE AIMS AND OBJECTIVES OF THE ASSESSE E WHICH WAS TO WORK FOR THE WELFARE OF THE ECONOMICALLY WEAKER SEC TION OF THE SOCIETY AND TO UNDERTAKE PROJECTS FOR RURAL HEALTH AND SANI TATION IN THE NEEDY AREA. THE ASSESSEE UTILIZED THE ACCUMULATED FUNDS A S PER THE MINUTES OF THE GOVERNING BODY DATED 22/04/2011. THIS WAS AC CEPTED BY THE REVENUE IN THE SUBSEQUENT ASSESSMENT YEAR WHICH SHO WS THAT THE ASSESSEE HAD UTILIZED THE ACCUMULATED FUNDS FOR THE AIMS AND OBJECTS OF THE TRUST IN INDIA. 8.6 SINCE THE ASSESSEE HAS FOLLOWED THE PROCEDURE F OR ACCUMULATION EXCEPT FOR THE TECHNICAL LAPSE, WHICH CAN BE CONDONED AND SINCE THE ASSESSEE HAS APPLIED THE ACCUMULATED FUNDS FOR THE OBJECTS OF THE TRUST IN INDIA, WE HOLD THAT IT IS ELIGIBLE TO GET THE BENEFIT UNDER THE PROVISIONS OF SECTION 11(2). 9. IN THE RESULT, APPEAL OF ASSESSEE IS ALLOWED. PRONOUNCED IN THE OPEN COURT ON 4 TH NOVEMBER, 2015. SD/- SD/- (P. MADHAVI DEVI) (S. RIFAUR RAHMA N) JUDICIAL MEMBER ACCOUN TANT MEMBER HYDERABAD, DATED: 4 TH NOVEMBER, 2015 10 ITA NO. 592 /HYD/2015 PRESENTATION SOCIAL SERVICE CENTRE KV COPY TO:- 1) M/S PRESENTATION SOCIAL SERVICE CENTRE, FATIMA N AGAR REC(POST) WARANGAL 506 004 2) DDIT(EXEMPTIONS)-II, HYDERABAD 3) CIT(A)-9, HYDERABAD 4) CIT(E), HYDERABAD 5) THE DEPARTMENTAL REPRESENTATIVE, I.T.A.T., HYDE RABAD.