KRISHNA KALA TRUST, MUMBAI V. DIT (E), MUMBAI

ITA 7079/MUM/2012

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 8010 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 8 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-08-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 05-08-2014
• Assessment Year: 2012-2013
• Appeal Filed On: 26-11-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S PADMAJA
• Assessee Lawyers: SNEHAL R SHAH
• Section: 12A; 12AA

Judgement Text

A , , , , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH A, MUMBAI , ! ! ! ! , ' ' ' ' BEFORE SHRI B R BASKARAN, ACCOUNTANT MEMBER AND SHRI VIVEK VARMA, JUDICIAL MEMBER . : . : . : . : 7079 7079 7079 7079/ // / / // / 2012 ITA NO. : 7079/MUM/2012 KRISHNA KALA TRUST, PLOT NO. 26, KRISHNA BUNGLOW, GREATER BOMBAY CHS, GULMOHAR, CRS ROAD NO. 5, JVPD SCHEME, JUHU, MUMBAI -400 049 ) .: PAN: AABTK 7689 J VS DIT(E), 6 TH FLOOR, PIRAMAL CHAMBERS, PAREL, MUMBAI -400 012 )* (APPELLANT) +,)* (RESPONDENT) APPELLANT BY : SHRI SNEHAL R SHAH RESPONDENT BY : SMT. S PADMAJA -./0 /DATE OF HEARING : 05-08-2014 123 ./0/ DATE OF PRONOUNCEMENT : 08-08-2014 4 4 4 4 O R D E R ! ! ! ! , . . . . . .. . PER VIVEK VARMA, J.M. : INSTANT APPEAL IS FILED BY THE ASSESSEE AGAINST THE ORDER OF DIRECTOR OF INCOME TAX (EXEMPTION) (DIT(E), DATED 2 8.09.2012, WHEREIN THE DIT(E) HAS REJECTED THE REGISTRATION SOUGHT UND ER SECTION 12AA OF THE INCOME TAX ACT, 1961. 2. THE FACTS ARE THAT THE ASSESSEE FILED AN APPLICA TION FOR REGISTRATION UNDER SECTION 12A ON 21.03.2012, ALONG WITH ALL DOCUMENTS AS PRESCRIBED. THE DIT(E), EXAMINED THE T RUST DEED AND WAS OF THE OPINION THAT THE TRUST HAD MIXED OBJECTS , I.E. CHARITABLE AND NON CHARITABLE/BUSINESS, SUCH AS ESTABLISHMENT & MA INTENANCE OF LECTURE HALLS, TEACHING COMMERCIAL AND OTHER ARTS, ESTABLISHMENT OF HOSTELS, MIDWAY HOMES, BOARDING HOUSES, GYM, BOOKSH OPS, CRCHES, YOGA TRAINING CENTERS, STUDIOS, RUNNING SMALL SCALE INDUSTRIES, PROVISIONS OF ASSISTANCE TO SOFTWARE AND IT RELATED ACTIVITIES, KRISHNA KALA TRUST ITA NO. 7079/MUM/2012 2 ESTABLISHMENT OF DIAGNOSTIC CENTERS, INTERNATIONAL SCHOOLS AND COACHING CENTERS ETC. BESIDES THE ABOVE, THE DEED A UTHORIZED THE TRUST TO DEPLOY ITS CORPUS FUNDS IN CREATING SMALL SCALE INDUSTRY OR CONSTRUCT THE FACTORIES AND CREATE JOB OPPORTUNITIES TO JOBLE SS YOUTH OF VICINITY AND TO CREATE THE WORK AT RURAL AREAS AND SETTLE BH OOMIPUTRAS SO THAT THEY SHALL NOT RUSH TO CITY IN SEARCH OF A JOB/WORK . 3. BESIDES THE ABOVE, THE DIT(E) ALSO OBSERVED THAT MR. DEEPOO VASWANI, ONE OF THE TRUSTEES, WAS YET TO BE ACCEPTE D BY THE CHARITY COMMISSIONER AS A TRUSTEE & HIS APPLICATION AS ON T HE EVEN DATE WAS PENDING. 4. THE DIT(E), THEREFORE, HELD THAT SINCE THE OBJEC TS WERE NOT PURELY CHARITABLE, AND ALSO THERE IS NO BINDINGS CLAUSE FO R THE UTILIZATION OF TRUST FUNDS, THE TRUST DID NOT COMPLY WITH THE STAT UTORY PROVISIONS FOR GRANT OF REGISTRATION, HENCE, THE DIT(E) REJECTED T HE APPLICATION FOR REGISTRATION UNDER SECTION 12A. 5. AGGRIEVED, THE ASSESSEE IS NOW BEFORE THE ITAT. 6. BEFORE US, THE AR SUBMITTED THAT THE DIT(E), WHI LE EXAMINING THE CORRECTNESS OF CLAIM OF REGISTRATION, PICKED WO RDS, PHRASES AND EXPRESSIONS RANDOMLY FROM DIFFERENT PARTS OF THE TR UST DEED. THE AR TOOK US THROUGH THE TRUST DEED AND POINTED OUT THAT THE EXPRESSIONS WERE PICKED UP RANDOMLY AND PUT IN THE IMPUGNED ORD ER TO MAKE THE BASIS FOR REFUSAL (APB 6 TO 11). 7. THE AR ALSO SUBMITTED THAT EVIDENCE OF ADMISSION OF MR. DEEPOO VASWANI WAS SUBMITTED BEFORE THE DIT(E) IN THE COUR SE OF PROCEEDINGS. 8. THE AR, THEREFORE, SUBMITTED THAT THE DIT(E) DID NOT EXAMINE THE TRUST DEED IN THE RIGHT PERSPECTIVE AND DID NOT GIV E ANY CREDENCE TO THE DOCUMENTS SUBMITTED WITH REGARD TO MR. DEEPOO VASWA NI. HE KRISHNA KALA TRUST ITA NO. 7079/MUM/2012 3 THEREFORE, PLEADED THAT THE IMPUGNED ORDER BE SET A SIDE AND THE DIT(E) BE DIRECTED TO GRANT REGISTRATION. 9. THE DR RELIED ON THE ORDER OF THE DIT(E). 10. WE HAVE HEARD THE ARGUMENTS AND HAVE PERUSED TH E DOCUMENTS PLACED BEFORE US. THE SUBMISSION OF THE AR THAT CER TAIN WORDS AND EXPRESSIONS WERE RANDOMLY PICKED UP BY THE DIT(E) I S EVIDENT. THIS MEANS, THE ENTIRE REASONING AND MOTIVE OF FORMATION OF THE TRUST HAS BEEN TATTERED. WE ALSO FIND THAT THE ASSESSEE HAD F ILED PAPERS ACCEPTED BY THE CHARITY COMMISSIONER WHEREIN THE ADMISSION O F MR. DEEPOO VASWANI WAS ACCEPTED. 11. THESE FACTS HAVE TO BE READ AND UNDERSTOOD IN A RIGHT PERSPECTIVE. 12. IN THESE CIRCUMSTANCES, WE ARE OF THE OPINION T HAT THE DIT(E) MUST EXAMINE THE ISSUE AFRESH TO COME TO A REASONAB LY CORRECT DECISION, WHETHER TO DENY OR ACCEPT THE REGISTRATIO N, AFTER EXAMINING ALL THE DOCUMENTS AND THE FUNCTIONS OF THE TRUST. 13. WE, THEREFORE, SET ASIDE THE ORDER OF DIT(E) DA TED 28.09.2012 FOR FRESH AND DE NOVO ADJUDICATION ON THE APPLICATION OF REGISTRATION UN DER SECTION 12A. 14. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 8 TH AUGUST, 2014. SD/- SD/- ( ) ( ! ! ! !) (B R BASKARAN) (VIVEK VARMA) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATE: 8 TH AUGUST, 2014 KRISHNA KALA TRUST ITA NO. 7079/MUM/2012 4 +// COPY TO:- 1) )*/ THE APPELLANT. 2) +,)*/ THE RESPONDENT. 3) THE CIT (A)__CONCERNED___/DIT(E), MUMBAI. 4) 7 )__ CONCERNED___/DIT(E), MUMBAI /THE CIT__,/ CONCERNED MUMBAI. 5) 89+/- , , THE D.R. A BENCH, MUMBAI. 6) 9:!; COPY TO GUARD FILE. 4- / BY ORDER / / TRUE COPY / / [ , DY. / ASSTT. REGISTRAR I.T.A.T., MUMBAI *@A=- .-. * CHAVAN, SR. PS