Surat Halai Memon Jamat, Surat V. Commissioner of Income Tax (Exemption), Ahmedabad

ITA 690/SRT/2023

• Counselvise Citation: [2024] 100 COUNSELVISE.COM (IT) 4047 (ITAT-SURAT)
• Duration Of Justice: 3 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-01-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 10-01-2024
• Assessment Year: 2023-2024
• Appeal Filed On: 10-10-2023
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: SURESH K. KABARA
• Section: 12A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, SURAT BENCH, SURAT BEFORE SHRI PAWAN SINGH, JM & DR. A. L. SAINI, AM आयकर अपील सं./ITA No.690/SRT/2023 Assessment Year: (2023-24) (Physical Hearing) Surat Halai Memon Jamat, Opp. Silk House, Chowk Bazar, Surat - 395003 Vs. The CIT (Exemption), Ahmedabad èथायीलेखासं./जीआइआरसं./PAN/GIR No.: AALTS2355M (Appellant) (Respondent) Appellant by Shri Suresh K. Kabara, CA Respondent by Shri Ravinder Sindhu, CIT(DR) Date of Hearing 11/01/2024 Date of Pronouncement 31/01/2024 आदेश / O R D E R PER DR. A. L. SAINI, AM: Captioned appeal filed by the assessee, is directed against the order passed by the Learned Commissioner of Income Tax (Exemption), [in short “the ld. CIT(E)”], Ahmedabad, in Appeal No.CIT (Exemption), AHMEDABAD/2023-24/12AA/10350, dated 28.07.2023 wherein the ld. CIT(E) rejected the application filed by assessee under sub-clause (iii) of clause (ac) of sub-section 1 of section 12A of the Act (in short ‘the Act’). 2. The grounds of appeal raised by the assessee are as follows: “1. The Ld CIT(E) was not just and proper on the facts of the case and in law in rejecting the application of the Trust for registration u/s 12A(1)(ac)(iii).” 3. Brief facts qua the issue are that assessee-trust has filed Form 10AB u/s 12A(1)(ac)(iii) of the Act, on 24/01/2023. The applicant had been granted order for provisional registration in Form No. 10AC 2 ITA No. 690/SRT/2023 Surat Halai Memon Jamat issued, on 25/09/2022 under section 12A(1)(ac)(vi) for the period commencing from A.Y. 2023-24 to AY 2025-26. From perusal of details available on records, its is observed that the Name of the applicant/assessee as per PAN/Form No.10AB is “SURAT HALAI MEMON JAMAT”, whereas the name of the applicant/assessee as per translated PTR submitted and Certificate of Registration issued by Gujarat State Wakf Board, appears as “SURAT HALAI MEMON JAMAT AND HALAI MEMON JAMAT KABRASTHAN”. There is obvious mismatch in name as per PAN database/Form No.10AB vis-à- vis Certificate of Registration, PTR and audited accounts, as detailed above. Therefore, a show cause notice was issued to the applicant on 22/07/2023, and requested to furnish explanation/reasons of above mismatch and also requested to show cause as to why the application filed in Form 10AB u/s 12A(1)(ac)(iii) should not be rejected. 4. In response to the above notice, the applicant has furnished its response on 28/07/2023 wherein the applicant has furnished acknowledgment receipt of PAN application (Change Request) dated 25/07/2023. However, the correction has not been made in PAN database so far. 5. The ld CIT( E) also noted from perusal of notes on activities and copy of PTR submitted by the applicant, that the objects of the applicant trust enumerated in the copy of PTR, is different from Notes on activities. Therefore, the genuineness of the activities does not get established and these activities are not in consonance with the object of the trust. Furthermore, from perusal of objects of the applicant, it was observed by ld CIT(E) that following objects, which is otherwise 3 ITA No. 690/SRT/2023 Surat Halai Memon Jamat charitable in nature, are for the benefit of any particular religious community or caste “Memon Jamat/Community”: “To endeavor to promote brotherhood among the members and to maintain cordial relations with brotherly Jamats...” 6. Therefore, ld. CIT(E) held that there is violation of section 13(1)(b) of the Income Tax Act, 1961. The ld. CIT(E) also observed that the applicant has failed to satisfy about the genuineness of the activities of the trust or institution and these activities are not in consonance with the objects of the trust or institution. Therefore, application of the applicant under sub-clause (iii) of clause(ac) of sub- section(1) of section 12A was rejected by ld. CIT(E), in respect of provisional registration granted to him on 25.09.2022. 7. Aggrieved by the order of ld.CIT(E), the assessee is in appeal before us. 8. Shri Suresh K. Kabra, Ld. Counsel for the assessee submitted that assessee’s application for registration has been rejected mainly on two reasons; viz: (1) mismatch of name of the assessee-trust, and (ii) genuineness of activities of assessee-trust. The Ld. Counsel submitted that assessee -trust could not submit the entire objects and activities of the trust before ld CIT(E ), however, now assessee-trust is ready to submit the relevant documents for objects and genuineness of activities of the trust. About mismatch in the name of the trust, the ld Counsel argued that the name which is written in the request of new PAN Card should be treated as correct name of assessee-trust. The ld Counsel stated that the correct name which is selected by the trustees is as follows: “SURAT HALAI MEMON JAMAT AND HALAI MEMON JAMAT KABARSHATN”. This is the name which is written in the 4 ITA No. 690/SRT/2023 Surat Halai Memon Jamat request of new PAN Card of the assessee- trust, therefore, ld CIT(E ) should consider the above name. The ld Counsel also argued that assessee-trust was not created for the benefit of any particular religious community or caste. Finally, ld Counsel stated that one more opportunity should be given to the assessee-trust to plead its case before ld. CIT(E), hence matter may be remitted back to the file of the ld CIT(E ) for fresh adjudication of assessee`s application in Form 10AB u/s 12A(1)(ac)(iii) of the Act. 9. On the other hand, Learned Commissioner of Income Tax – Departmental Representative [ld. CIT-DR) for the Revenue reiterated the stand taken by the ld. ld. CIT(E), which we have already noted in our earlier para and is not being repeated for the sake of brevity. 10. We have heard the rival contentions, perused the material on record and duly considered facts of the case in the light of the applicable legal position. In our considered view, it was wholly erroneous on the part of the ld CIT(E ) to reject the assessee`s application on account of mismatch of name. The mismatch in name may be rectified and corrected and the corrected name may be accepted. It should not be a reason to deny registration of the assessee- trust. The ld Counsel submitted before us, the correct name, which is to be adopted as “SURAT HALAI MEMON JAMAT AND HALAI MEMON JAMAT KABARSHATN”. We have also noted that the assessee has already taken steps to correct the above name in the PAN database, therefore above name should be treated as a correct name. Hence, we direct the ld. CIT(E) to consider the above stated name of assessee-trust and registration should not be denied to the assessee - trust, on this ground. 5 ITA No. 690/SRT/2023 Surat Halai Memon Jamat 11. However, so far objects and activities are concerned, we note that assessee-trust is now ready to submit the entire list of objects and genuineness of its activities and these objects and activities may be verified by ld CIT(E ). In these circumstances, we are of the view that one more opportunity should be given to the assessee to plead its case and to explain all documents and evidences before ld CIT(E). Therefore, we direct the ld. CIT(E) to go through the objects, and activities of the trust and then adjudicate the issue in accordance with law. For, statistical purpose, the appeal is allowed for statistical purposes. 12. In the result, appeal of the assessee is allowed for statistical purposes. Order is pronounced on 31/01/2024 in the open court. Sd/- Sd/- (PAWAN SINGH) (Dr. A.L. SAINI) JUDICIAL MEMBER ACCOUNTANT MEMBER lwjr /Surat Ǒदनांक/ Date: 31/01/2024 SAMANTA Copy of the Order forwarded to 1. The Assessee 2. The Respondent 3. The CIT(A) 4. CIT 5. DR/AR, ITAT, Surat 6. Guard File By Order // TRUE COPY // Assistant Registrar/Sr. PS/PS ITAT, Surat