Sarvodaya Ilakkiya Pannai, Madurai V. CIT, Madurai

ITA 594/CHNY/2011

• Counselvise Citation: [2011] 119 COUNSELVISE.COM (IT) 6507 (ITAT-CHENNAI)
• Duration Of Justice: 2 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-06-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: misc
• Appeal Filed On: 31-03-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: K E B RENGARAJAN JR
• Assessee Lawyers: R SRINIVASAN
• Section: 12A; 12AA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, CHENNAI BEFORE SHRI N. S. SAINI, ACCOUNTANT MEMBER AND SHRI GEORGE MATHAN, JUDICIAL MEMBER .. I.T.A. NO. 594/MDS/2011 ASSESSMENT YEAR : - SARVODAYA ILAKKIYA PANNAI, 32/1, WEST VELI STREET, MADURAI-625 001. V. THE COMMISSIONER OF INCOME-TAX-I, MADURAI (PAN:AAATS3428E) (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI R. SRINIVASAN RESPONDENT BY : SHRI K.E.B. RENGARAJAN, JR. STANDING COUNSEL O R D E R PER GEORGE MATHAN, JUDICIAL MEMBER : THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST TH E ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX-I, MADURAI IN C. NO. 464 /51/CIT-I/1989-90 DATED 31-01-2011. 2. SHRI R. SRINIVASAN, ADVOCATE REPRESENTED ON BEHA LF OF THE ASSESSEE AND SHRI K.E.B. RENGARAJAN, JR. STANDING COUNSEL REPRESENTED ON BEHALF OF THE REVENUE. 3. IT WAS SUBMITTED BY THE LEARNED AUTHORISED REPRE SENTATIVE THAT THE ASSESSEE WAS A TRUST WHICH WAS DOING THE ACTIVITY OF PUBLICA TION AND SALE OF SARVODAYA I.T.A. NO.594/MDS/2011 2 LITERATURE AS ALSO THE GANDHIAN AND SARVODAYA IDEOL OGIES. IT WAS THE SUBMISSION THAT THE LEARNED CIT HAD CATEGORICALLY GIVEN A FIN DING THAT THOUGH CONSTRUCTIVE ACTIVITIES IN ACCORDANCE WITH THE DOCTRINE OF MAHAT MA GANDHI ARE DEFINITELY OF PUBLIC GENERAL UTILITY AND CHARITABLE IN CHARACTER, BUT THE ASSESSEE SOCIETY WAS NOT DOING ANY WORK CONNECTED WITH THE GANDHIAN PHILOSOP HY. IT WAS THE SUBMISSION THAT THE CIT HAD GIVEN A FINDING THAT SELLING OF BO OKS DEFINITELY WAS NOT DEFINITELY A CHARITABLE ACTIVITY. IT WAS THE SUBMISSION THAT THE ASSESSEE WAS DOING THE ACTIVITY OF PUBLICATION AND SALE OF GANDHIAN AND SA RVODAYA IDEOLOGY BOOKS AND WAS NOT DEALING IN ANY OTHER ACTIVITY. IT WAS THE SUBMISSION THAT AS PER THE PROVISIONS OF SECTION 12AA(3) THE REGISTRATION GRA NTED TO THE ASSESSEE COULD HAVE BEEN REFUSED ONLY IF THE ACTIVITIES WERE NOT GENUIN E ORWERE NOT CONDUCTED INLINE WITH THE OBJECTS OF THE ASSESSEE TRUST. IT WAS THE SUBMISSION THAT THE ASSESSEE TRUST HAD BEEN GRANTED REGISTRATION U/S 12A BY AN O RDER DATED 6-11-1989 AND THERE WAS NO FINDING THAT THE ASSESSEE TRUST WAS EI THER NOT A GENUINE OR WAS DOING ANY ACTIVITIES WHICH WERE NOT APPROVED BY THE OBJECTS OF THE TRUST. 4. IN REPLY, THE LEARNED DR VEHEMENTLY SUPPORTED TH E ORDER OF THE LEARNED CIT. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. A PER USAL OF THE ORDER OF THE LEARNED CIT SHOWS THAT WHEN THE RETURNS OF THE ASSE SSEE FOR THE ASSESSMENT YEARS 2008-09 TO 2010-11 WERE VERIFIED, IT WAS NOTI CED THAT THE ASSESSEE SOCIETY WAS ENGAGED IN THE PURCHASE AND SALE OF BOOKS. IT WAS FOR THIS PURPOSE THAT THE LEARNED CIT HAD DECIDED TO LOOK INTO THE QUESTION O F SECTION 12A REGISTRATION I.T.A. NO.594/MDS/2011 3 WHICH IS GRANTED TO THE ASSESSEE. THERE IS NO RECO RDING IN THE ORDER OF THE LEARNED CIT THAT THE ACTIVITIES OF THE ASSESSEE TRU ST WERE NOT GENUINE OR THAT THE ASSESSEE SOCIETY WAS NOT DOING ANY ACTIVITIES IN LI NE WITH THE OBJECTS OF THE ASSESSEE SOCIETY FOR WHICH THE ASSESSEE HAD BEEN GR ANTED THE REGISTRATION UNDER SECTION 12A. A PERUSAL OF THE PROVISIONS OF SECTIO N 12AA(3) OF THE INCOME TAX ACT, 1961 WHICH GIVE POWERS TO THE LEARNED CIT TO C ANCEL REGISTRATION GRANTED UNDER SECTION 12AA SHOWS THAT THERE ARE TWO CONDITI ONS UNDER WHICH THE REGISTRATION U/S 12AA CAN BE REVOKED, THE FIRST BEI NG THAT THE ACTIVITIES WERE NOT GENUINE AND SECONDLY THAT THE ACTIVITIES CONDUCTED BY THE ASSESSEE ARE NOT IN LINE WITH THE OBJECTS OF THE TRUST. THERE IS NO FINDING THAT EITHER OF THESE TWO CONDITIONS HAS BEEN VIOLATED. FURTHER IT HAS BEEN CATEGORICALLY ADMITTED BY THE LEARNED AUTHORISED REPRESENTATIVE THAT THE ASSESSEE SOCIETY IS NOT DOING ANY ACTIVITY OTHER THAN THE ACTIVITY CONNECTED WITH THE SPREADING AND PROPAGATING OF GANDHIAN AND SARVODAYA IDEOLOGIES, THE PURPOSE FOR WHICH THE ASSESSEE HAD BEEN GRANTED REGISTRATION UNDER SECTION 12A EARLIER IN 1 989. IN THE CIRCUMSTANCES, AS NO SPECIFIC VIOLATION HAD BEEN POINTED OUT, WE ARE OF THE VIEW THAT THE ASSESSEE IS ENTITLED TO THE CONTINUATION OF REGISTRATION UNDER SECTION12AA. CONSEQUENTLY, THE ORDER OF THE LEARNED CIT CANCELING THE REGISTRATION UNDER SECTION 12AA STANDS REVERSED. IN THE CIRCUMSTANCES, IT IS HELD THAT TH E REGISTRATION GRANTED TO THE ASSESSEE UNDER SECTION 12A(A) VIDE ORDER IN C. NO. 464/51/89-90 DATED 06-11- I.T.A. NO.594/MDS/2011 4 1989 WOULD CONTINUE TO HOLD GOOD. IN THE CIRCUMSTA NCES, THE APPEAL OF THE ASSESSEE IS ALLOWED. 6. THE ORDER WAS PRONOUNCED IN THE COURT ON 30/06/2 011. SD/- SD/- (N. S. SAINI) (GEORGE MATHAN) ACCOUNTANT MEMBER JUDICIAL MEMBER CHENNAI, DATED THE 30 TH JUNE, 2011. H. COPY TO: ASSESSEE/AO/CIT (A)/CIT/D.R./GUARD FILE