Shri Gannath Development Foundation Trust, V. The Commissioner of Income Tax-III, RAJKOT-GUJARAT

ITA 70/RJT/2013

• Counselvise Citation: 7024914 RSA 2013
• Duration Of Justice: 1 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-05-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: misc
• Appeal Filed On: 01-04-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANKUR GARG
• Assessee Lawyers: DR ADHIA
• Keywords: Charitable institution
• Section: 12AA

Judgement Text

0 Y : S : IN THE INCOME TAX APPELLATE TRIBULAL: RAJKOT BENCH: RAJKOT . . , ' . . ' , ' BEFORE SHRI T K SHARMA, JM AND SHRI D K SRIVASTAVA, AM ITA NO. 70 /RJT /2013 SHRI GANNATH DEVELOPMENT V. CIT - III, RAJKOT FOUNDATION TRUST, AT. MANDOR, TAL. VERAVAL, DIST. JUNAGADH DATE OF HEARING : 1 6 - 0 4 - 201 3 DATE OF PRONOUNCEMENT : 30 - 0 5 - 201 3 ASSESSEE BY: SHRI D R ADHIA, AR REVENUE BY : SHRI ANKUR GARG, DR / ORDER . . ' /D. K. SRIVASTAVA: THE APPEAL FILED BY THE ASSESSEE - TRUST IS DIRECTED AGAINST THE ORDER PASSED BY THE LD. CIT , RAJKOT - III U/S 80G(5) ON 31 .0 1.2013 BY WHICH HE HAS DECLINED TO GRANT RECOGNITION U/S. 80G(5) TO THE ASSESSEE - TRUST . THE ASSESSEE - TRUST HAS TAKEN THE FOLL OWING GROUNDS OF APPEAL : - 1. THE LD. COMMISSIONER OF INCOME - TAX HAS ERRED IN LAW AND FACTS IN REFUSING TO GRANT APPROVAL U/S 80G(5) OF THE INCOME - TAX ACT, 1961. THE TRUST DESERVES RECOGNITION U/S 80G(5). 2. THE LD. C.I.T. HAS ERRED IN COMING TO THE CONCLUSION THAT APPELLANT IS NOT FULFILLING THE CONDITION FOR APPROVAL OF THE PROVISIONS OF SECTION 80G(5) OF THE IT ACT. THE TRUST DESERVES RECOGNITION U/S 80G(5). 3. THE LD. C.I.T. HAS ERRED IN COMING TO THE CONCLUSION BASED ON IRRELEVANT ASPECT THAT THE TRUST HAS NOT CARRIED OUT ACTIVITIES WHICH ENTITLE ITS FOR RECOGNITION U/S 80G(5) AS PER OBJECT OF THE TRUST. THE TRUST DESERVES RECOGNITION U/S 80G(5). 4. THE LD. C.I.T. HAS ERRED IN NOT CONSIDERING THE REAL ASPECT OF THE PROVI SI ONS OF SECTION 80G(5) OF THE IT ACT, 1961. THE TRUST DESERVES RECOGNITION U/S 80G(5) . 5. TAKING INTO CONSIDERING THE LEGAL, FACTUAL AND STATUTORY ASPECT OF THE OBJECT OF THE TRUST, THE LD. CIT OUGHT TO HAVE GRANTED RECOGNITION U/S 80G(5) AS APP LIED FOR. IT IS THEREFORE PRAYED THAT THE ORDER PASSED BY THE LD. C.I.T. 2 ITA 70 /RJT/2013 REFUSING TO GRANT RECOGNITION U/S 80G(5) MAY KINDLY BE CANCELLED AND HE MAY BE DIRECTED TO GRANT RECOGNITION U/S 80G(5) TO THE APPELLANT AS APPLIED FOR. 6. WITHOUT PREJUDICE, THE LD. CIT HAS ERRED IN NOT GRANTING ADEQUATE AND REASONABLE OPPORTUNITY. THE ORDER PASSED BY THE LD. CIT NEEDS CANCELLATION/RESTORATION TO CONSIDER AFRESH THAT THE TRUST DESERVES RECOGNITION U/S 80G(5). 7. WITHOUT PREJUDICE, THE ORDER PASSED U/S 80G(5) IS BAD I N LAW DESERVES CANCELLATION. 8. THE APPELLANT CRAVES LEAVE TO ADD/ALTER/AMEND AND/OR SUBSTITUTE ANY OR ALL GROUNDS OF APPEAL BEFORE THE ACTUAL HEARING TAKES PLACE. 2. WE HAVE HEARD BOTH THE PARTIES. THE ASSESSEE - TRUST APPLIED FOR APPROVAL U/S 80G(5) ON 20.07.2012 BEFORE THE CIT IN THE PRESCRIBED FORM TOGETHER WITH COPY OF AUDIT REPORT FOR FY 2009 - 10, 2010 - 11 & 2011 - 12. THE ASSESSEE - TRUST CAME INTO EXISTENCE BY A TRUST DEED ON 04.03.2002. IT IS REGISTERED UNDER BPT ACT ON 21.05.2005. IT IS ALSO REGISTERED U/S 12AA OF THE INCOME - TAX ACT. ON VERIFICATION OF THE TRUST DEED ATTACHED WITH THE APPLICATION FOR APPROVAL, IT WAS NOTICED BY THE COMMISSIONER THAT THE TRUST HAS BEEN CREATED BY THE PERSONS BELONGING TO THE SAME FAMILY. IT WAS ALSO NOTICED BY HIM THAT T HE ASSESSEE - TRUST HAS NOT CARRIED OUT ANY CHARITABLE ACTIVITIES MENTIONED IN THE TRUST DEED EXCEPT CONSTRUCTION OF DAM PROJECTS OF THE STATE GOVERNMENT. 3. THE LD COMMISSIONER THEREFORE CALLED UPON THE ASSESSEE - TRUST TO EXPLAIN THE POSITION. IT IS STATE D IN PARA 4 AND 5 OF THE IMPUGNED ORDER THAT THE ASSESSEE - TRUST DID NOT TURN UP FOR HEARING ON THE DATE FIXED BY THE COMMISSIONER. THE COMMISSIONER THEREFORE DECLINED TO GRANT APPROVAL U/S 80G(5) OF THE INCOME - TAX ACT. IT IS ALSO STATED IN PARA 6 OF THE IM PUGNED ORDER THAT THE ACTIVITIES CARRIED OUT BY THE ASSESSEE - TRUST WERE COMMERCIAL IN NATURE AND NOT CHARITABLE. 4. THE ASSESSEE IS REGISTERED BY THE COMMISSIONER OF INCOME - TAX HIMSELF AS A CHARITABLE INSTITUTION U/S 12AA OF THE INCOME - TAX ACT. AFTER FIL ING THE APPLICATION FOR APPROVAL U/S 80G(5) OF THE INCOME - TAX ACT, IT WAS INCUMBENT ON THE PART OF THE ASSESSEE TO APPEAR BEFORE THE LD COMMISSIONER AND SATISFY HIM ABOUT THE 3 ITA 70 /RJT/2013 FULFILLMENT OF CONDITIONS SPECIFIED U/S 80G(5) OF THE INCOME - TAX ACT. NO PREJUDIC E WOULD BE CAUSED TO THE REVENUE IF THE ASSESSEE - TRUST IS DIRECTED TO APPEAR BEFORE THE LD COMMISSIONER AND ESTABLISH THAT ALL THE CONDITIONS STIPULATED BY SECTION 80G(5) ARE BEING SATISFIED BY THE ASSESSEE. IN THIS VIEW OF THE MATTER, THE ORDER PASSED BY THE COMMISSIONER IS SET ASIDE AND THE MATTER IS RESTORED TO HIS FILE FOR A FRESH DECISION AFTER GIVING REASONABLE OPPORTUNIT Y OF HEARING. THE ASSESSEE - TRUST IS ADVISED IN ITS OWN INTEREST TO APPEAR BEFORE THE LD COMMISSIONER AND SATISFY HIM ABOUT THE FULFI LLMENT OF CONDITIONS LAID DOWN IN SECTION 80G(5) OF THE INCOME - TAX ACT. THE APPEAL FILED BY THE ASSESSEE - TRUST IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES. S 30 .0 5 . 2013 S ORDER PRONOUNCED ON 30 .0 5 . 201 3 SD/ - SD/ - ( 0 . . 3 / T. K. SHARMA) ( . . / D. K. SRIVASTAVA) SI / JUDICIAL MEMBER 2013 / ACCOUNTANT MEMBER RAJKOT: 30 .0 5 .2013 BT T / COPY OF ORDER FORWARDED TO: - 5 . / APPELLANT - . SHRI GANNATH DEVELOPMENT FOUNDATION TRUST, MANDOR, VERAVAL, JUNAGADH 2 . 2R / RESPONDENT - CIT - III , RAJKOT 3 . Y V / CONCERNED CIT 4 . 2IIY , 0 Y , / DR, ITAT, RAJKOT 5 . 3 / GUARD FILE. / BY ORDER , TRUE COPY PRIVATE SECRETARY, ITAT, RAJKOT