Unity Education & Charitable Trust, RAJKOT-GUJARAT V. The Commissioner of Income Tax-I, RAJKOT-GUJARAT

ITA 657/RJT/2012

• Counselvise Citation: 65724914 RSA 2012
• Duration Of Justice: 11 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-12-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 26-11-2013
• Assessment Year: misc
• Appeal Filed On: 31-12-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DR M L MEENA
• Assessee Lawyers: DR ADHIA
• Keywords: Charitable institution

Judgement Text

IN THE INCOME TAX APPELLATE TRIBULAL, SMC BENCH, RAJKOT BEFORE SHRI T. K. SHARMA, JM ITA NO. 657/RJT/2012 UNITY EDUCATION & CHARITABLE TRUST, NR. GOVIND NAGAR BUS STAND, AT. MOVIYA, TAL. GONDAL, DIST. RAJKOT PAN : AAATU 4376 P ( / APPELLANT) THE COMMISSIONER OF INCOME-TAX-I RAJKOT / RESPONDENT / ASSESSEE BY SHRI D R ADHIA, AR / REVENUE BY DR M L MEENA, DR / DATE OF HEARING 26.11.2013 !'# / DATE OF PRONOUNCEMENT 13.12.2013 / ORDER THIS APPEAL BY THE ASSESSEE-TRUST IS AGAINST THE OR DER DATED 30.11.2012 OF COMMISSIONER OF INCOME-TAX, RAJKOT-I, RAJKOT REJECT ING THE APPLICATION MADE BY THE ASSESSEE SEEKING APPROVAL U/S 80G(5) OF THE INCOME- TAX ACT, 1961. 2. THE FACTS, IN BRIEF, ARE THAT THE ASSESSEE-TRUST MADE AN APPLICATION IN FORM NO.10G FOR GRANT APPROVAL U/S 80G(5) OF THE INCOME- TAX ACT ON 21.05.2012. THE ASSESSEE-TRUST IS REGISTERED U/S 12A(A) OF THE INCO ME-TAX ACT VIDE NO.CIT/RAJ/12A/38/RANGE.1/2011-12 DATED 01.05.2012. THE MAIN OBJECTS OF THE ASSESSEE-TRUST ARE CHARITABLE ACTIVITIES IN THE EDU CATIONAL FIELD. FOR THE FY 2011-12, THE ASSESSEE-TRUST HAD SHOWN RECEIPT OF DONATION OF RS.10,000/- AND ESTABLISHMENT EXPENDITURE OF RS.75/- AND IN THE CURRENT FY, THE A SSESSEE-TRUST CLAIMED THE EXPENDITURE OF RS.9000/- TOWARDS THE OBJECTS OF THE TRUST, WITHOUT PROVIDING DETAILS OF THE EXPENDITURE. THE LD. COMMISSIONER OF INCOME-TA X, RAJKOT-I VIDE ITS LETTER NO.CIT.R-1/TECH/80G/UE&CT/2012-13 DATED 19.11.2012 ASKED THE ASSESSEE-TRUST PROVIDE THE DETAILS OF ITS ACTIVITIES CARRIED OUT A LONGWITH DOCUMENTARY EVIDENCE AND TO EXPLAIN THE LOAN GIVEN TO THE TRUSTEE. THE ASSESSE E-TRUST NEITHER APPEARED BEFORE THE LD. CIT, RAJKOT-I NOR SOUGHT ANY ADJOURNMENT FOR TH E DATE OF HEARING FIXED ON 27.11.2012. THEREFORE, THE LD COMMISSIONER OF INCOM E-TAX, RAJKOT-I REJECTED THE APPLICATION OF THE ASSESSEE-TRUST SEEKING APPROVAL U/S 80G(5) FOR THE DETAILED REASON GIVEN IN PARAGRAPH NOS. 5 AND 6 OF THE IMPUGNED ORD ER, WHICH READ AS UNDER:- 5. AS DISCUSSED ABOVE, THE QUANTUM OF EXPENDITURE IS SO MEAGER, WHICH LEADS TO THE ONLY CONCLUSION THAT THE TRUST DID NOT CARRY OUT SUBSTANTIAL 2 657-RJT-2012 - UNITY EDUCATION & CHARITABLE TRUST (SMC) ACTIVITIES. BESIDES WHATEVER EXPENDITURE THEY CLAIM ED TO BE INCURRED, NO EVIDENCE IS PRODUCED TO SUBSTANTIATE AS TO WHATEVER THE SAME WERE INCURRED TOWARDS THE OBJECTS OF THE TRUST. IT IS AN ESSENTI AL CONDITION BEFORE ALLOWING APPROVAL U/S 80G(5) OF THE ACT, THAT THE TRUST IS E NGAGED IN CHARITABLE ACTIVITIES. 6. IN VIEW OF THE ABOVE, THE TRUST HAS FAILED TO CO MPLY WITH THE REQUIREMENTS FOR APPROVAL U/S 80G(5) AS LAID DOWN U NDER SECTION 80G(5) & RULE 11AA OF THE I.T. ACT, 1962. THE APPLICATION MA DE BY THE ASSESSEE SEEKING APPROVAL U/S 80G(5) IS THEREFORE HEREBY REJ ECTED. AGGRIEVED WITH THE ORDER OF LD COMMISSIONER OF INC OME-TAX, RAJKOT-I, THE ASSESSEE-TRUST IS NOW IN APPEAL BEFORE THIS TRIBUNA L, ON THE FOLLOWING GROUNDS:- 1. THE LD. COMMISSIONER OF INCOME-TAX-I, RAJKOT HA S ERRED IN LAW AND FACTS IN REFUSING TO GRANT APPROVAL U/S 80G(5)(VI) OF THE INCOME-TAX ACT, 1961. THE TRUST DESERVES APPROVAL U/S 80G(5). 2. THE LD. C.I.T. HAS ERRED IN COMING TO THE CONCLU SION THAT APPELALTN IS NOT FULFILLING THE CONDITION FOR APPROVAL OF THE PR OVISONS OF SECTION 11AA OF THE IT ACT. THE TRUST DESERVES APPROVAL U/S 80G(5). 3. THE LD. C.I.T. HAS ERRED IN COMING TO THE CONCLU SION BASED ON IRRELEVANT ASPECT THAT THE TRUST IS NOT ENGAGED IN CHARITABLE ACTIVITIES AND HENCE NOT ENTITLE FOR APPROVAL U/S 80G(5). THE TRUST DESERVES APPROVAL U/S 80G(5). 4. THE LD. C.I.T. HAS ERRED IN NOT CONSIDERING THE REAL ASPECT OF THE PROVISIONS OF SECTION 80G(5) OF THE IT ACT, 1961. T HE TRUST DESERVES APPROVAL U/S 80G(5). 5. TAKING INTO CONSIDERING THE LEGAL, FACTUAL AND S TATUTORY ASPECT OF THE OBJECT OF THE TRUST, THE LD. C.I.T. OUGHT TO HAVE G RANTED APPROVAL U/S 80G(5)(VI) AS APPLIED FOR. IT IS THEREFORE PRAYED THAT THE ORD ER PASSED BY THE LD. C.I.T. REFUSING TO GRANT APPROVAL U/S 80G(5)(VI) MAY KINDL Y BE CANCELLED AND HE MAY BE DIRECTED TO GRANT APPROVAL U/S 80G(5)(VI) TO THE APPELLANT AS APPLIED FOR. 6. WITHOUT PREJUDICE, THE LD.CIT HAS ERRED IN NOT G RANTING ADEQUATE AND REASONABLE OPPORTUNITY. THE ORDER PASSED BY THE LD. CIT NEEDS CANCELLATION / RESTORATION TO CONSIDER AFRESH THAT THE TRUST DESER VES APPROVAL U/S 80G(5). 7. WITHOUT PREJUDICE, THE ORDER PASSED U/S 80G(5) I S BAD IN LAW DESERVES CANCELLATION. 8. THE APPELLANT CRAVES LEAVE TO ADD/ALTER/AMEND AN D/OR SUBSTITUTE ANY OR ALL GROUNDS OF APPEAL BEFORE THE ACTUAL HEARING TAK ES PLACE. 4. AT THE TIME OF HEARING, ON BEHALF OF ASSESSEE-TR UST, SHRI D R ADHIA, AUTHORIZED REPRESENTATIVE, APPEARED AND CONTENDED THAT AT THE TIME OF GRANTING APPROVAL FOR EXEMPTION U/S 80G, ONLY OBJECT OF THE TRUST IS REQU IRED TO BE EXAMINED AND APPLICATION OF FUNDS CAN BE EXAMINED BY ASSESSING O FFICER AT THE TIME FRAMING ASSESSMENT. IN SUPPORT OF THIS, THE AUTHORIZED REP RESENTATIVE FOR THE ASSESSEE-TRUST RELIED UPON THE JUDGMENT OF THE HONBLE PUNJAB & HA RYANA HIGH COURT IN ITS JUDGMENT DELIVERED ON 02.05.2013 IN THE CASE OF CIT V. O.P. JINDAL GLOBAL UNIVERSITY, REPORTED 3 657-RJT-2012 - UNITY EDUCATION & CHARITABLE TRUST (SMC) IN (2013) 38 TAXMANN.COM 366 (P&H). HE ALSO RELIED UPON THE DECISION OF THE ITAT, SMC BENCH, RAJKOT IN THE CASE OF SHREE GOVINDBHAI J ETHALAL NATHVANI CHARITABLE TRUST IN ITA NO.402/RJT/2013, WHEREIN THE TRIBUNAL HAS FOLLOWED THE JUDGMENT OF HONBLE PUNJAB &HARYANA HIGH COURT IN THE CASE OF O .P. JINDAL GLOBAL UNIVERSITY(SUPRA). 5. AS AGAINST THE SUBMISSION MADE BY THE LD. AR; D R. M L MEENA, DR, APPEARED ON BEHALF OF THE REVENUE, VEHEMENTLY SUPPORTED THE ORDER OF LD. COMMISSIONER OF INCOME-TAX, RAJKOT-I. HE SUBMITTED THAT SINCE NO E VIDENCES WERE PRODUCED BY THE ASSESSEE-TRUST TO SUBSTANTIATE AS TO WHATEVER THE S AME WERE INCURRED TOWARDS THE OBJECTS OF THE TRUST, THE VIEW TAKEN BY THE LD COM MISSIONER OF INCOME-TAX, RAJKOT-I REJECTING THE APPLICATION U/S 80G(5) OF THE INCOME- TAX ACT BE UPHELD. 6. HAVING HEARD BOTH SIDES, I HAVE CAREFULLY GONE T HE ORDER OF THE LD. COMMISSIONER OF INCOME-TAX, RAJKOT-I AND THE ORDERS RELIED UPON BY THE LD. AUTHORIZED REPRESENTATIVE OF THE ASSESSEE-TRUST. TH E HONBLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF CIT V. O.P. JINDAL GLOBAL UNIVERSITY (SUPRA) HELD THAT AT THE TIME OF GRANTING APPROVAL FOR EXEMPTION U/S 80G, OB JECT OF THE TRUST IS REQUIRED TO BE EXAMINED AND APPLICATION OF FUNDS CAN BE EXAMINED B Y ASSESSING OFFICER AT THE TIME OF FRAMING ASSESSMENT. THE DECISION OF PUNJAB & HA RYANA HIGH COURT IN THE CASE OF O.P. JUNDAL GLOBAL UNIVERSITY (SUPRA) HAS BEEN FOLL OWED BY THIS TRIBUNAL IN THE CASE OF SHREE GOVINDBHAI JETHALAL NATHVANI CHARITABLE TR UST IN ITA NO.402/RJT/2013 ALSO. RESPECTFULLY FOLLOWING THE SAME, I SET ASIDE THE IM PUGNED ORDER OF LD COMMISSIONER OF INCOME-TAX, RAJKOT-I AND DIRECT HIM TO GRANT THE APPROVAL U/S 80G(5) OF THE INCOME- TAX ACT, 1961 TO THE ASSESSEE-TRUST. 6. IN THE RESULT, APPEAL OF THE ASSESSEE-TRUST IS A LLOWED. THIS ORDER PRONOUNCED IN OPEN COURT ON THE DATE MEN TIONED HEREINABOVE. SD/- ( $.. &' / T. K. SHARMA) ( ) /JUDICIAL MEMBER *)& +) ,/ ORDER DATE:13.12.2013 !$ /RAJKOT *BT 4 657-RJT-2012 - UNITY EDUCATION & CHARITABLE TRUST (SMC) / COPY OF ORDER FORWARDED TO:- 1. / APPELLANT- UNITY EDUCATION & CHARITABLE TRUST, N R. GOVIND NAGAR BUS STAND, AT. MOVIYA, TAL. GONDAL, DIST. RAJKOT 2. / RESPONDENT- THE COMMISSIONER OF INCOME-TAX, RAJK OT-I, RAJKOT 3. ,0,1 * * 2 / CONCERNED CIT-I, RAJKOT 4 . 345 1, * 1#, !$ / DR, ITAT, RAJKOT 5 . 57 89 / GUARD FILE *)& / BY ORDER TRUE COPY PRIVATE SECRETARY, ITAT, RAJKOT