Shri Jamnagar Visha Shrimali Tapagach Gnati Khatu, JAMNAGAR V. The Commr. Of Income Tax, JAMNAGAR

ITA 685/RJT/2014

• Counselvise Citation: [2015] 134 COUNSELVISE.COM (IT) 0497 (ITAT-RAJKOT)
• Duration Of Justice: 10 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-10-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 05-10-2015
• Assessment Year: misc
• Appeal Filed On: 02-12-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: KALPESH S DOSHI
• Keywords: Charitable institution
• Section: 12AA; 12

Judgement Text

ITA NO . 685/RJT/2014 PAGE 1 OF 4 IN THE INCOME TAX APPELLATE TRIBUNAL RAJKOT BENCH, RAJKOT [CORAM: PRAMOD KUMAR AM AND RAJPAL YADAV JM] ITA NO. 685 / RJT / 2 0 1 4 SHRI JAMNAGAR VISHA SHRIMALI TAPAGACHH ....... .. . ..... APPELLANT GNATI KHATU , C/O. DOSHI MARU & ASSOCIATES, CHARTERED ACCO UNTANTS, MANEK CENTRE, P.N. MARG, JAMNAGAR. [PAN A A BTS 0577 K ] VS. COMMISSIONER OF INCOME TAX , ....... ..................RESPONDENT JAMNAGAR. APPEARANCES BY: KALPESH S. DOSHI FOR THE A PPELLANT YOGESH PANDEY FOR THE RESPONDENT DATE OF CONCLUDING THE HEARING : OCTOBER 5 TH , 201 5 DATE OF PRONOUNCING THE ORDER : OCTOBER 7 TH , 2015 O R D E R PER PRAMOD KUMAR AM: 1. BY WAY OF THIS APPEAL, THE ASSESSEE APPLICANT HAS CHALLENGED CORRECTNESS OF THE ORDER DATED 7 TH AUGUST, 2014 PASSED BY THE LD. CIT , R EJECTING GRANT OF REGISTRATION UNDER SECTION 12AA OF THE INCOME TAX ACT, 1961 ( THE ACT HEREINAFTER) . 2. LD. COUNSEL FOR THE ASSESSEE INVITES OUR ATTENTION TO THE FACTS THAT THE REGISTRATION HAS BEEN DECLINED ON THE SHORT GROUND THAT THE ASSESSEE COULD NOT INCLUDE THE PROVISIONS IN THE RELATED TRUST DEED TO THE EFFECT THAT UPON THE DISSOLUTION , IF ANY PROPERTY REMAINS AFTER SATISFACTION OF ITS DEBT S AND LIABILITIES , THE SAME SHALL BE TRANSFERRED TO ANOTHER T RUST HAVING SIMILAR OBJECTS. HE FURTHER POINT S OUT THAT THIS ISSUE ITA NO . 685/RJT/2014 PAGE 2 OF 4 IS NO W COVERED IN FAVOUR OF THE ASSESSEE BY THE DIVISION BENCH ORDER OF THE TRIBUNAL IN THE CASE OF SHREE CHARG AM DASHA PORWAD VS. DIRECTOR OF INCOME TAX (EXEMPTION) IN ITA NOS.337 & 338/AHD/2013 , ORDER DATED 08.05.2013 . 3. LD. D EP ARTMENTAL REPRESENTATIVE, HOWEVER , INVITES OUR ATTENTION TO SMC ORDER DATED 20 TH JUNE 201 3 IN THE CASE OF LATE SHRI MOHA NLAL KANJIBHAI PANSARA EDUCATION & CHARITABLE TRUST VS. CIT WHEREIN THE MATTER WAS SET ASIDE TO THE FILE OF A . O . FOR APPROPRIATE MODIFIC ATION IN THE TRUST DEED. 4. HEAVING HEARD THE RIVAL CONTENTIONS AND HAVING PERUSED THE MATERIAL ON RECORD, WE ARE OF THE CONSIDERED VIEW THAT THE ISSUE IS NOW COVERED IN FAVOUR OF THE ASSESSEE, IN PRINCIPLE, BY THE JUDGEMENT DATED 25.03.2015 OF HON BLE HI GH COURT OF GUJARAT AT AHMEDABAD IN THE CASE OF CIT VS. TAPAGACHHA SANGH MOTA (TAX APPEAL NOS.915, 916 & 917 OF 2014), WHEREIN THEIR LORDSHIP S HAVE HELD AS FOLLOWS: - 12. FROM THE ORDERS PASSED BY THE COMMISSIONER REFUSING TO GRANT REGISTRATION CERTIFICATE UNDER SECTION 12AA OF THE ACT AND EVEN FROM THE ORDER PASSED BY THE LEARNED TRIBUNAL, IT APPEARS THAT NONE OF THE AUTHORITIES BELOW HAVE CONSIDERED THE ABOVE MATERIAL AND RELEVANT ASPECT WITH RESPECT TO THE SATISFACTION OF THE COMMISSIONER WITH RESPECT TO GENUINENESS OF THE TRUST. IN A GIVEN CASE EVEN IN ABSENCE OF ANY PROVISION IN THE TRUST WITH RESPECT TO DISSOLUTION CLAUSE IF ON FACTS THE TRUST IS FOUND TO BE GENUINE AND/OR GENUINENESS OF THE TRUST IS ESTABLISHED, THE TRUST MAY BE ENTITLED TO REGISTR ATION UNDER SECTION 12AA OF THE ACT, HOWEVER SUBJECT TO FULFILMENT OF CONDITIONS UNDER SECTION 12 AA OF THE ACT I.E. WHEN THE COMMISSIONER IS SATISFIED ABOUT THE GENUINENESS OF THE ACTIVITIES OF THE TRUST OR THE INSTITUTION. AS OBSERVED HEREIN ABOVE, BOTH THE COMMISSIONER AS WELL AS LEARNED TRIBUNAL HAVE NOT ADDRESSED THEMSELVES ON THE AFORESAID RELEVANT ASPECT, WE ARE OF THE OPINION THAT MATTERS ARE REQUIRED TO BE REMITTED BACK TO THE FILE OF THE COMMISSIONER AND REMANDED T O THE LEARNED COMMISSIONER TO CON SIDER THE ISSUE/GRANT OF REGISTRATION CERTIFICATE UNDER SECTION 12AA OF THE ACT AFRESH IN ACCORDANCE WITH LAW AND ON MERITS AND TO CONSIDER THE GENUINENESS OF THE TRUST/INSTITUTION/GENUINENESS OF THE ACTIVITIES OF THE TRUST AFTER GIVING AN OPPORTUNITY TO T HE TRUST TO MAKE SUBMISSIONS AND/OR PRODUCE ON RECORD ANY ITA NO . 685/RJT/2014 PAGE 3 OF 4 MATERIAL IN RESPECT OF THEIR CASE THAT THERE IS NO REASON TO DOUBT THE GENUINENESS OF THE ACTIVITIES OF THE T R UST. 13. IN VIEW OF THE ABOVE AND FOR THE REASONS STATED ABOVE, ALL THE APPEALS SUCCEED IN PART. THE IMPUGNED JUDGEMENT AND ORDERS PASSED IN ITA NO . 440/RJT/2013, ITA NO.441/RJT/2013 AND IT A NO. 442/RJT/2013 DATED 29.05.2014 AND 30.05.2014 RESPECTIVELY PASSED BY THE LEARNED ITAT AND THE ORDERS PASSED BY COMMISSIONER , JAMNAGAR REJECTING THE RE GISTRATION CERTIFICATE UNDER SECTION 12AA OF THE ACT TO THE RESPECTIVE ASSESSEE TRUSTS ARE HEREBY QUASHED AND SET ASIDE AND MAT T ERS ARE REMITTED TO FILE OF THE COMMISSIONER/ APPROPRIATE AUTHORITY TO CONSIDER THE APPLICATIONS OF THE RESPECTIVE ASSESSEE TRUST FOR ISSUANCE OF REGISTRATION CERTIFICATE UNDER/SECTION 12AA OF THE ACT AFRESH AND IN ACCORDANCE WITH LAW AND ON MERITS AND IN LIGHT OF THE OBSERVATIONS MADE HEREIN ABOVE AND AFTER GIVING AN OPPORTUNITY TO THE RESPONDENT TRUSTS TO PRODUCE ON RECORD ANY MAT ERIAL IF THEY SO CHOSE, IN SUPPORT OF THE GENUINENESS OF THE ACTIVITIES OF THE TRUST. THE AFORESAID EXERCISE SHALL BE COMPLETED WITHIN A PERIOD OF THREE MONTHS FROM THE DATE OF RECEIPT OF THE PRESENT ORDER. IT WILL BE OPEN FOR THE TRUST TO SUBMIT ADDITIO NAL MATERIAL, IF ANY, IN SUPPORT OF THEIR CLAIM THAT SINCE MANY YEAS TRUST IS FILING RETURN OF INCOME AND CLAIMING E XEMPTION UNDER SECTION 12AA OF THE ACT MEANING THEREBY TO ESTABLISH THE GENUINE NE SS OF THE TRUST AND/OR ITS ACTIVITIES, TO BE PRODUCED WITHI N A PERIOD OF ONE MONTH FROM THE DATE OF RECEIPT OF THE PRESENT ORDER AND THE SAME BE CONSIDERED BY THE APPROPRIATE AUTHORITY/CONCERN COMMISSIONER IN ACCORDANCE WITH LAW AND ON ITS OWN MERITS. WITH THIS, ALL THESE APPEALS ARE ALLOWED TO THE AFORESAID EX T E N T . IN THE FACTS AND CIRCUMSTANCES OF THE CASE , THERE SHALL BE NO ORDER AS TO COSTS. 5. RESPECTFULLY FOLLOWING THE ESTEEMED VIEWS OF THE HON BLE JURISDICTIONAL HIGH COURT , WE REMIT THE MATTER TO THE FILE OF LD . CIT FOR FRESH CONSIDERATION IN T H E LIGHT OF DIRECTIONS OF HON BLE HIGH COURT OF GUJARAT AS SET OUT ABOVE. THE SAME WILL APPLY MUTAT IS MUTANDIS IN THIS CASE AS WELL. 6. AS THE MATTER SANDS REMITTED TO THE FILE OF LD . CIT FOR FRESH ADJUDICATION AS ABOVE, WE SEE NO NEED TO DEAL WITH THE ISSUE AS REGARDS TO GENUINENESS OF THE ACTIVITIES AT THIS STAGE. THAT ASPECT OF THE MATTER IS TO BE EXAMINED ON MERITS BY THE LD . CIT AND THE LD . CIT SHALL PASS A SPEAKING ORDER ON THE SAME IN ACCORDANCE WITH LAW AND AFTER GIVING A DUE AND REASONABLE OPPORTUNITY O F HEARING TO THE ASSESSEE. ITA NO . 685/RJT/2014 PAGE 4 OF 4 7 . IN THE RESULT, A PPEAL IS ALLOWED FOR STATISTICAL PURPOSES . P RONOUNCED IN THE OPEN COURT ON THIS 7 TH DAY OF OCTOBER , 2015. SD/ - SD/ - RAJPAL YADAV PRAMOD KUMAR (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) RAJKOT , THE 7 TH DAY OF OCTOBER , 2015 PBN/* COPIES TO: (1) THE APPELLANT (2) THE RESPONDENT (3) COMMISSIONER (4) CIT(A) (5) DEPARTMENTAL REPRESENTATIVE (6) GUARD FILE BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL RAJKOT BENCH, RAJKOT