Shri Dineshwar Mishra Ji Memorial Servjan Educational Vocational And Development Trust, Lucknow V. CIT, Lucknow

ITA 681/LKW/2010

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 9165 (ITAT-LUCKNOW)
• Duration Of Justice: 1 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-01-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 18-01-2011
• Assessment Year: misc
• Appeal Filed On: 25-11-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P K B AJAJ
• Assessee Lawyers: M L AGRAWAL
• Keywords: Opportunity of being heard
• Section: 80G; 12A; 12AA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, B - BENCH, LUCKNOW. BEFORE SHRI H.L.KARWA, HON'BLE VICE PRESIDENT AND SHRI N.K.SAINI, ACCOUNTANT MEMBER I.T.A.NOS.681 & 682 (LKW.)/2010 SHRI DINESHWAR MISHRA JI MEMORIAL VS. THE CIT-I, SERVJAN EDUCATIONAL VOCATIONAL AND LUCKNOW. DEVELOPMENT TRUST, C-25,SECTOR-N,. ALIGANJ, LUCKNOW PAN AAITS0044F (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI M.L.AGRAWAL, ADVOCATE RESPONDENT BY : SHRI P.K.BAJAJ, D.R. O R D E R PER N.K.SAINI, ACCOUNTANT MEMBER THESE TWO APPEALS BY THE ASSESSEE ARE DIRECTED AGA INST THE SEPARATE ORDERS EACH DATED 29.9.2010 OF THE LD.CIT(A)-I, LU CKNOW. SINCE THE APPEALS WERE HEARD TOGETHER, SO, THESE ARE BEING DI SPOSED OF BY THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE. WE WILL FIRST DE AL WITH I.T.A.NO.681(LKW)/2010. 2. IN THIS APPEAL, THE FOLLOWING GROUNDS OF APPEAL HAVE BEEN RAISED: 1. THAT THE COMMISSIONER OF INCOME TAX LUCKNOW-I H AS ERRED BOTH IN LAW AS WELL AS IN FACTS IN REFUSING TO REGI STER THE APPELLANT TRUST U/S 12A OF THE INCOME TAX ACT. 2. THAT THE APPELLANT TRUST IS A GENUINE TRUST REGI STERED UNDER THE INDIAN TRUST ACT WITH THE SUB-REGISTRAR LUCKNOW ON 20/01/2010. 2 3. THAT ALL THE OBJECTS OF THE TRUST ARE CHARITABLE IN NATURE . 4. THAT THE TRUST IS IRREVOCABLE TRUST. 5. THAT THE ORDER IS AGAINST THE PROVISION OF SECTI ON 12AA OF THE I.T. ACT. 6. THAT THE TRUST DESERVES TO BE REGISTERED U/S 12A OF THE I.T. ACT. 7. THAT THE ORDER OF THE COMMISSIONER OF INCOME TAX IS AGAINST THE MERITS, CIRCUMSTANCES AND LEGAL ASPECTS OF THE CASE . 3. FROM THE ABOVE GROUNDS, IT IS CLEAR THAT THE ONL Y GRIEVANCE OF THE ASSESSEE RELATES TO REJECTION OF APPLICATION MOVED BY THE ASSESSEE UNDER SECTION 12A(1)(A) OF THE INCOME-TAX ACT,1961 FOR SE EKING THE REGISTRATION UNDER THE SAID SECTION. 4. THE FACTS OF THE CASE, IN BRIEF, ARE THAT THE ASSESSEE-TRUST WAS CREATED ON 20.1.2010, IT FILED AN APPLICATION UNDER SECTION 12A(1)(A) OF THE I.T.ACT ON 8.3.2010 SEEKING REGISTRATION UNDER THE SAID SE CTION. HOWEVER, THE LD.CIT REFUSED THE REGISTRATION BY OBSERVING AS UND ER : 1. CORPUS : THE AMOUNT OF MONEY AND IMMOVABLE PROPERTY SETTLE D INITIALLY UPON TRUST DEED SHALL FORM THE CORPUS OF THE TRUST, WHICH SHALL NOT BE DISPOSED OFF FOR MEETING ANY EXPENSES UNLESS OTHERWISE RESOLVED UNANIMOUSLY BY THE TRUSTEES. THE AMOUNTS O R OTHER PROPERTIES WHICH THE TRUST MAY RECEIVE AFTER THE EX ECUTION OF THIS DEED SHALL BE ADDED TO THE CORPUS OF THE TRUST. 2. THERE IS NO ANY CLAUSE IN CONNECTION WITH THE D ISTRIBUTION OF THE ASSET ON DISSOLUTION OF TRUST IN THE TRUST DEED. ON 27.09.2010, SHRI MUNNA LAL AGARWAL, ADVOCATE ATT ENDED AND WRITTEN SUBMISSION FILED. IT IS SUBMITTED THAT TRUST IS IN IRREVOCABLE TRUST AND IS CREATED FOR THE FULFILLMEN T OF OBJECTIVES. HE 3 FURTHER SUBMITTED THAT THERE IS NO QUESTION OF THE EXTINCTION OF THE TRUST. DISCREPANCIES ARE NOT EXPLAINED AND THE PROVISION REGARDING DISTRIBUTION/LIQUIDATION OF THE INITIAL C ORPUS FUND IS OBJECTIONABLE. IN ABSENCE OF ANY CLAUSE IN CONNECTI ON WITH THE DISTRIBUTION OF ASSETS ON DISSOLUTION OF TRUST IS N OT A VALID TRUST AS PER INDIAN TRUST ACT. IN VIEW OF THE ABOVE, THIS IS NOT FOUND TO BE A FIT CASE FOR GRANTING REGISTRATION U/S 12A(1)(A) OF THE I.T. ACT . ACCORDINGLY, THE REGISTRATION SOUGHT IS HEREBY REJECTED. 5. NOW THE ASSESSEE IS IN APPEAL. 6. THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE LD.CIT WITHOUT DISCUSSING THE OBJECTS AND NATURE OF THE ACTIVITY O F THE ASSESSEE REJECTED THE APPLICATION AND EVEN DID NOT CONSIDER THE WRITTEN S UBMISSIONS FILED BEFORE HIM ON 27.9.2010. 7. IN HIS RIVAL SUBMISSIONS, THE LD.D.R. SUPPORTED THE ORDER OF THE LD.CIT. 8. AFTER CONSIDERING THE SUBMISSIONS OF BOTH THE PA RTIES AND THE MATERIAL ON RECORD IT APPEARS THAT THE LD.CIT, ALTHOUGH POIN TED OUT SOME DISCREPANCIES, BUT DID NOT DISCUSS THE OBJECTS AND NATURE OF ACTIVITY OF THE ASSESSEE. EVEN HE DID NOT POINT OUT WHAT WERE THE C ONTENTIONS IN THE WRITTEN SUBMISSIONS OF THE ASSESSEE AND AS TO WHETHER THE E XPLANATION GIVEN BY THE ASSESSEE IN THE WRITTEN SUBMISSIONS WAS PLAUSIBLE O R NOT. WE, THEREFORE, DEEM IT APPROPRIATE TO SET ASIDE THIS ISSUE BACK TO THE FILE OF THE LD.CIT TO BE DECIDED AFRESH IN ACCORDANCE WITH LAW AFTER PROVIDI NG DUE AND REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 9. NOW, WE WILL DEAL WITH I.T.A.NO.682(LKW)/2010. 4 10. IN THIS APPEAL, THE ONLY GRIEVANCE OF THE ASSE SSEE RELATES TO THE REJECTION OF APPLICATION MOVED FOR APPROVAL UNDER S ECTION 80G(5) OF THE I.T.ACT. 11. THE FACTS OF THE CASE, IN BRIEF, ARE THAT THE A SSESSEE APPLIED FOR RECOGNITION UNDER SECTION 80G ON 8.3.2010. THE LD.C IT REJECTED THE SAID APPLICATION BY STATING THAT THE REGISTRATION CLAIME D UNDER SECTION 12A OF THE I.T.ACT HAD BEEN REJECTED BY THE SEPARATE ORDER OF EVEN DATE I.E.29.9.2010. 12. SINCE WE HAVE RESTORED THE ISSUE RELATING TO TH E REGISTRATION UNDER SECTION 12A OF THE I.T.ACT TO THE FILE OF THE LD. C IT, THEREFORE, THE ISSUE RELATING TO THE APPROVAL UNDER SECTION 80G(5) BEIN G CONSEQUENTIAL IN NATURE IS ALSO RESTORED TO THE FILE OF THE LD. CIT TO BE A DJUDICATED AFRESH IN ACCORDANCE WITH LAW AFTER PROVIDING DUE AND REASONA BLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 13. IN THE RESULT, BOTH THE APPEALS ARE ALLOWED FOR STATISTICAL PURPOSES. THE ORDER PRONOUNCED IN THE OPEN COURT ON SD. SD. (H.L.KARWA) (N.K.SAINI) VICE PRESIDENT ACCOUNTANT MEMBER JANUARY 20 TH ,2011. COPY TO THE : 1. APPELLANT 2. RESPONDENT 3. CIT(A) (4) CIT 5.DR. A.R.,ITAT, LUCKNOW. SRIVASTAVA.