ANAND ASHRAM NYAAS, Dausa V. CIT, Alwar

ITA 722/JPR/2011

• Counselvise Citation: [2012] 119 COUNSELVISE.COM (IT) 7551 (ITAT-JAIPUR)
• Duration Of Justice: 5 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-01-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2010-2011
• Appeal Filed On: 05-08-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: NARESH SHARMA
• Keywords: Charitable institution
• Section: 80G; 12AA

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL JAIPUR BENCH B JAIPUR (BEFORE SHRI R.K.GUPTA AND SHRI N.L.KALRA) ITA NO.722/ JP/2011 U/S 12AA OF THE ACT PAN: AACTA 9679 F ANAND ASHRAM NYAAS VS. THE CIT 16/77, BASVA ROAD, BANDIKUI, DAUSA ALWAR (APPELLANT ) (RESPONDENT) ASSESSEE BY : SHRI NARESH SHARMA DEPARTMENT BY : SHRI SUNIL MATHUR DATE OF HEARING: 10-01-2012 DATE OF PRONOUNCEMENT: 25-01-2012 ORDER PER N.L. KALRA, AM:- THE ASSESSEE HAS FILED AN APPEAL AGAINST THE ORDE R U/S 12AA OF THE ACT OF THE LD. CIT, ALWAR DATED 25-05-2011. 2.1 THE ONLY GRIEVANCE OF THE ASSESSEE IS THAT THE LD. CIT ERRED IN REJECTING THE ASSESSEE'S APPLICATION FOR REGISTRATION OF THE TRUS T AS A CHARITABLE INSTITUTION U/S 12AA OF THE ACT. 2.2 THE LD. CIT HAS NOT ALLOWED REGISTRATION AFTER OBSERVING AS UNDER:- THE TRUST DO NOT HAVE ANY EMPLOYEE TO CARRY OUT T HE CHARITABLE ACTIVITIES. SHRI NARESH SHARMA SUBMITTED THAT THEY ARE NOT ALE TO PRODUCE AUDIED ACONTS FOR THE FINANCIAL YEAR 2010-11 AS NO AUDIT HAS BEEN CARRIED OUT. NO RETURN OF INCOME TAX HAS BEEN FILED BY THE TRUST AS THE TRUST WAS CREATED IN THE PREVIOUS FINANCIAL YEAR ONLY. HOWEVE R, HE WAS UNABLE TO 2 PRODUCE ANY DOCUMENTAL EVIDENCE WHICH CLARIFIES THE ROLE OF THE TRUST IN DOING CHARITABLE WORK. AS PER THE INCOME AND EXPEND ITURE ACCOUNT FOR THE PERIOD ENDING ON 31-03-2011, THE TRUST HAS RECEIVED RS. 26,506/- AS DONATIONS FROM THE DONORS AND RS. 13,000/- AS SECUR ED LOAN FROM SMT. SHEELA VILLIAM. THE AR OF THE TRUST WAS REQUESTED T O SUBMIT THE DETAILS OF THE DONATIONS RECEIVED BY IT IN THE RELEVANT PERIOD FOR WHICH HE SUBMITTED RS. 5,101/- EACH HAS BEEN RECEIVED FROM THE FOLLOWI NG DONORS. 1. SHRI RAM GOPAL AMERICA 29-10-2010 2. M/S. RICHA WILLIAM 29-10-2010 3. SHRI RAJENDRA SHARMA 04-12-2010 4. SMT. SHEELA WILLIAM 20-01-2011 5. SHRI BENI PRASAD SONI 31-01-2011 HOWEVER, HE SUBMITTED THAT OUT OF THE AFORESAID DON ORS, FIRST TWO HAVE NOT APPLIED FOR PAN AS THEY DO NOT HAVE ANY TA XABLE INCOME AND THE DETAILS OF THE REST THREE IS NOT AVAILABLE AT THE M OMENT. THE GENUINENESS OF THE DONATIONS RECEIVED BY THE TRUST MUST BE VERIFIA BLE BY MEANS OF INCOME, COMPLETE ADDRESS OF THE DONORS WHICH MUST BE SUBMIT TED BY THE TRUST AT THE TIME OF HEARING. FURTHER, THE TRUST DID NOT FILE IT S RETURN OF INCOME AND NO AUDIT HAS BEEN CARRIED OUT BY THE TRUST. THE ACTUAL CHARITABLE WORK CARRIED OUT BY THE TRUST IS STILL UNCLEAR AS THERE IS NO CO RPUS FUND AND THE TRUST IS COMPLETELY DEPENDENT ON THE DONATIONS TO CARRY OUT CHARITABLE ACTIVITIES. THE SAID TRUST/ ASSOCIATION HAS NOT DONE ANY WORK O F CHARITABLE NATURE AND THAT BY RELYING ON THE DECISION OF HON' BLE KERALA HIGH COURT IN THE CASE OF SELF EMPLOYERS SERVICE SOCIETY VS. CIT (247 ITR 18), THE REQUEST/ APPLICATION FOR EXEMPTION U/S 80G AT A PRE MATURE STAGE AND THE TRUST COULD COME UP FOR REGISTRATION IF IT HAD ACTU ALLY DONE ANY WORK. HEAD NOTE OF THE JUDGEMENT READ AS UNDER:- 3 IN THE PRESENT CASE, ADMITTEDLY, THE SOCIETY HAS NOT DONE ANY CHARITABLE WORK DURING THE RELEVANT PERIOD ; ON THE OTHER HAND, THE ACTIVITIES WHICH THEY CARRIED ON DU RING THE PERIOD WERE ONLY FOR THE PURPOSE OF GENERATING INCO ME FOR ITS MEMBERS. THERE WERE NOT MATERIALS BEFORE THE COMMISSIONER TO BE SATISFIED OF THE GENUINENESS OF THE ACTIVITIES OF THE TRUST OR INSTITUTION. UNDER THESE CIRCUMSTANCES, REJECTION OF APPLICATION CANNOT BE T ERMED AS ILLEGAL OR ARBITRARY. HAVING REGARD TO THE FACT OF THE CASE, IT IS APPARE NT THAT THE TRUST HAS NOT BEEN ABLE TO BRING ANY EVIDENCE ON RECORD TO ESTABLISH THAT ITS ACTIVITIES TILL NOW WERE GENUINELY TAKEN FOR ANY CH ARITABLE PURPOSE, AS IT IS NOT OPEN TO PROPER VERIFICATION. IN VIEW OF ABOVE F ACTS, THE APPLICATION FOR EXEMPTION U/S 12AA IS HEREBY REJECTED. 2.3 WE HAVE HEARD BOTH THE PARTIES. WE HAVE PERUSED THE OBJECTS OF THE TRUST. THE OBJECTS ARE CHARITABLE IN NATURE. WHILE GRANTING RE GISTRATION TO THE TRUST, THE LD. CIT IS REQUIRED TO SATISFY HIMSELF ABOUT THE GENUINENESS O F THE A ACTIVITIES OF THE TRUST. IT IS NOTICED THAT DURING THE PERIOD FROM 11-10-2010 TO 3 1-03-2011, THE TRUST HAS INCURRED EXPENSES TO THE EXTENT OF RS. 38,954/-.THESE INCLUD ED MEDICAL SHIVIR EXPENSES, HANDICAPPED SHIVIR EXPENSES ETC. HENCE, IT CANNOT B E SAID THAT THE TRUST WAS NOT MAKING EXPENSES FOR THE OBJECTS OF THE TRUST. WE HAVE ALSO GONE THROUGH THE REPLY FILED BEFORE THE AO VIDE LETTER DATED 23-12-2010. IN THIS LETTER, IT WAS INTIMATED THAT THE ASSESSEE TRUST HAS ORGANIZED FREE MEDICAL CAMP ON 9-1-2011 FOR DISABLE D PERSONS WITH HELP OF FORTIS ESCORTS HOSPITAL. THE TRUST ORGANIZED THE SUPPORT MEET FOR DISABLED PERSONS ON 4 TH DEC. 2010 AT BANDIKUI. WE THEREFORE, FEEL THAT THE TRUST IS DOIN G THE ACTIVITIES AS PER OBJECTS OF THE TRUST. 4 WE THEREFORE, FEEL THAT THE TRUST IS ENTITLED FOR R EGISTRATION U/S 12AA OF THE ACT. ACCORDINGLY, THE LD. CIT IS DIRECTED TO ALLOW THE R EGISTRATION OF THE TRUST W.E.F. THE DATE FROM WHICH THE APPLICATION FOR REGISTRATION HAS BEE N FILED 3. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS AL LOWED. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 25-01 -2012. SD/- SD/- (R.K. GUPTA) (N.L. KALRA) JUDICIAL MEMBER ACCOUNTANT MEMBER JAIPUR DATED; 25 /01/2012 *MISHRA COPY FORWARDED TO :- 1. ANAND ASHRAM NYAAS, DAUSA 2. THE LD. CIT, ALWAR 3 THE LD. CIT BY ORDER 4 THE LD.DR 5 THE GUARD FILE (ITA NO.722/JP /11) A.R, ITAT, JAIPUR