Saradha Educational Society, V. THE CIT, Rajahmundry

ITA 744/VIZ/2013

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 1024 (ITAT-VISAKHAPATNAM)
• Duration Of Justice: 2 year(s) 6 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-07-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2011-2012
• Appeal Filed On: 30-12-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P HARI PRASADA RAO
• Section: 80G; 12AA

Judgement Text

ITA NOS.744&745/VIZAG/2013 SRADDAHA EDUCATIONAL SOCIETY, RAMPACHODAVARAM 1 , , IN THE INCOME TAX APPELLATE TRIBUNAL, VISAKHAPATNAM BENCH, VISAKHAPATNAM . , . , $ BEFORE SHRI V. DURGA RAO, JUDICIAL MEMBER & SHRI G. MANJUNATHA, ACCOUNTANT MEMBER ./I.T.A.NOS.744&745/VIZAG/2013 ( / ASSESSMENT YEAR: NA) SRADDAHA EDUCATIONAL SOCIETY, RAMPACHODAVARAM VS. CIT, RAJAHMUNDRY RANGE, RAJAHMUNDRY [PAN: AADAS5993C ] ( % / APPELLANT) ( &'% / RESPONDENT) / APPELLANT BY : SHRI G.V.N. HARI, AR / RESPONDENT BY : SHRI P. HARIPRASADA RAO, DR / DATE OF HEARING : 11.7.2016 / DATE OF PRONOUNCEMENT : 22.07.2016 / O R D E R PER V. DURGA RAO, JUDICIAL MEMBER: THESE APPEALS FILED BY THE ASSESSEE ARE DIRECTED A GAINST THE ORDER OF CIT, RAJAHMUNDRY DATED 25.11.2013. ITA NOS.744&745/VIZAG/2013 SRADDAHA EDUCATIONAL SOCIETY, RAMPACHODAVARAM 2 2. FACTS ARE IN BRIEF THAT THE ASSESSEE IS NAMELY S RADDAHA EDUCATIONAL SOCIETY REGISTERED WITH REGISTRAR OF SO CIETIES, RAJAHMUNDRY. THE SOCIETY HAS FILED AN APPLICATION IN FORM NO.10A DATED 4.5.2013 ON 6.5.2013 FOR REGISTRATION U/S 12AA OF THE INCOME TA X ACT, 1961 (HEREINAFTER CALLED AS 'THE ACT') ALONG WITH MEMORA NDUM OF ASSOCIATION AND RULES & REGULATIONS, ETC. THE OBJECTS OF THE AS SESSEE SOCIETY ARE AS UNDER: (I) TO DEVELOP SOCIAL CONTACTS AND SPIRIT OF FELLOW FEE LING AMONG ITS MEMBERS AND TO MAINTAIN A LIBRARY WITH GOOD BOOKS, PERIODIC ALS AND NEWSPAPERS. (II) TO STRIVE FOR THE ERADICATION OF ILLITERACY. (III)TO DEVELOP THE SOCIAL AND CULTURAL ACTIVITIES FOR THE WELFARE OF THE SOCIETY. (IV)GATHERING POOR CHILDREN TO EDUCATE ALL OF THEM. (V) TO ESTABLISHING NEW SCHOOLS & COLLEGES FOR EDUCATIN G THE POOR PEOPLE WHO ARE IN BACKWARD CASTE (AREA). THE SOCIETY BY MAKING AMENDMENTS TO THE MEMORANDUM OF ASSOCIATION AND RULES & REGULATIONS DELETED AND ADDED AIMS & OB JECTS IN THE MONTH OF JUNE, 2010 AS UNDER:- NO. AMENDED/INSERTED IV TO ESTABLISH, MAINTAIN TO HELP THE POOR AND DESTITU TE PEOPLE TO EDUCATE THEM. V TO ESTABLISH, OPEN, RUN, CONTINUE A NEW EDUCATIONAL AND VOCATIONAL SCHOOL, COLLEGES, INSTITUTION, ETC., IN BACKWARD AR EAS. VI TO PROMOTE SERVICE AND CULTURAL ORGANIZATIONS AND T O MAINTAIN FREE DISPENSARIES IN RURAL AREAS TO RENDER MEDICAL HELP TO THE NEEDY AND SICK PEOPLE VII TO START EMPLOYMENT SERVICES AND TO ASSIST IN CAREE R DEVELOPMENT AND ADVANCEMENT. VIII TO RUN THE ORGANIZATION ON NON-PROFIT BASIS. ITA NOS.744&745/VIZAG/2013 SRADDAHA EDUCATIONAL SOCIETY, RAMPACHODAVARAM 3 3. THE LD. COMMISSIONER AFTER EXAMINING THE OBJECTS OF THE ASSESSEE SOCIETY, HE IS OF THE OPINION THAT THE ASSESSEE RUN NING ONLY EDUCATIONAL INSTITUTION AND NOT CARRYING OTHER ACTIVITIES. THE COMMISSIONER FURTHER OBSERVED THAT THE SOCIETY FAILED TO PRODUCE BOOKS O F ACCOUNTS, DONATIONS RECEIVED, VOUCHERS OF EXPENSES FOR THE LAST 3 YEARS AS CALLED FOR. WITH THE ABOVE OBSERVATION, THE LD. COMMISSIONER DENIED THE REGISTRATION TO THE ASSESSEE U/S 12AA OF THE ACT. 4. ON BEING AGGRIEVED, ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE TRIBUNAL. 5. THE LD. COUNSEL FOR THE ASSESSEE HAS SUBMITTED T HAT THE LD. COMMISSIONER HAVING ACCEPTED THAT ASSESSEE IS RUNNI NG EDUCATIONAL INSTITUTION, HE SHOULD HAVE BEEN GRANTED REGISTRATI ON U/S 12AA OF THE ACT TO THE ASSESSEE. HE ALTERNATIVELY SUBMITTED THAT F OR THE PURPOSE OF EXAMINATION OF THE BOOKS OF ACCOUNTS, MATTER MAY BE REMITTED BACK TO THE FILE OF LD. COMMISSIONER AND HE IS READY TO SUB MIT ALL THE RELEVANT BOOKS AND VOUCHERS AND OTHER NECESSARY DOCUMENTS. ITA NOS.744&745/VIZAG/2013 SRADDAHA EDUCATIONAL SOCIETY, RAMPACHODAVARAM 4 6. ON THE OTHER HAND, THE LD. D.R. HAS SUBMITTED TH AT THE LD. COMMISSIONER HAS GIVEN AS MANY OPPORTUNITIES TO THE ASSESSEE, HOWEVER, IT DID NOT PRODUCE ANY MATERIAL BEFORE THE LD. COMMISSIONER AND THEREFORE, THE APPEAL FILED BY THE ASSESSEE MAY BE DISMISSED. 7. WE HAVE HEARD BOTH THE PARTIES, PERUSED THE MATER IALS AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHOR ITIES BELOW. THE ASSESSEE IS A SOCIETY RUNNING EDUCATIONAL INSTITUTI ON WITH THE CHARITABLE OBJECTIVES. THE OBJECTIVES OF THE ASSESSEE SOCIETY ARE NOT DOUBTED BY THE LD. COMMISSIONER. IN FACT, THE LD. COMMISSIONE R HIMSELF ADMITTED THAT ASSESSEE IS ONLY RUNNING EDUCATIONAL INSTITUTI ON AND NOT CARRYING OTHER ACTIVITIES. IN OUR OPINION, IT IS NOT NECESS ARY THAT ASSESSEE HAS TO CARRY ALL THE OBJECTIVES FOR WHICH IT WAS ESTABLISH ED. THE MAIN OBJECT OF THE ASSESSEE IS TO RUN THE EDUCATIONAL INSTITUTION. ACCORDINGLY, IT IS RUNNING EDUCATIONAL INSTITUTION, THEREFORE, ASSESSE E IS CARRYING ONLY ACTIVITY OF RUNNING EDUCATIONAL INSTITUTION CANNOT BE A GROUND FOR REJECTION OF REGISTRATION U/S 12AA OF THE ACT. IT IS FACT THAT ASSESSEE IS RUNNING THE EDUCATIONAL INSTITUTION IN A REMOTE ARE A OF RAMPACHODAVARAM, EAST GODAVARI DISTRICT. IT IS A B ACKWARD AREA WHERE EDUCATIONAL FACILITIES ARE NOT AVAILABLE. THEREFOR E, THE ASSESSEE SOCIETY ITA NOS.744&745/VIZAG/2013 SRADDAHA EDUCATIONAL SOCIETY, RAMPACHODAVARAM 5 IS RUNNING AN EDUCATIONAL INSTITUTION TO PROVIDE ED UCATION TO THE STUDENTS LIVING IN BACKWARD AREA OF EAST GODAVARI DISTRICT. THEREFORE, IN OUR OPINION, THE ASSESSEE IS ENTITLED FOR REGISTRATION U/S 12AA OF THE ACT. HOWEVER, THE ASSESSEE HAS FAILED TO PRODUCE THE BOO KS OF ACCOUNTS FOR THE PERIOD OF 3 YEARS AS ASKED BY THE LD. COMMISSIO NER. IN VIEW OF THE ABOVE, WE SET ASIDE THE ORDER PASSED BY THE LD. COM MISSIONER AND REMIT THE MATTER BACK TO THE LD. COMMISSIONER FOR L IMITED PURPOSE TO EXAMINE THE BOOKS OF ACCOUNTS AND CONSIDER THE CASE OF THE ASSESSEE FOR REGISTRATION U/S 12AA OF THE ACT. ORDERED ACCO RDINGLY. 8. THIS APPEAL VIDE ITA NO.744/VIZAG/2013 FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSE. 9. SO FAR AS ITA NO.745/VIZAG/2013 IS CONCERNED, IT IS RELATING TO GRANT OF REGISTRATION U/S 80G OF THE ACT. UNLESS I T IS REGISTERED U/S 12AA OF THE ACT, REGISTRATION U/S 80G OF THE ACT CANNOT BE GRANTED. THEREFORE, WE DIRECT THE LD. COMMISSIONER THAT AFTER TAKING A DECISION IN RESPECT OF REGISTRATION U/S 12AA OF THE ACT, HE IS DIRECTED TO TAKE A DECISION IN RESPECT OF GRANT OF REGISTRATION U/S 80G OF THE ACT TO THE ASSESSEE. IN VIEW OF THE ABOVE, THE APPEAL FILED BY THE ASSESSEE FOR GRANT OF REGISTRATION U/S 80G OF THE ACT IS ALSO ALLOWED FOR STATISTICAL PURPOSES. ITA NOS.744&745/VIZAG/2013 SRADDAHA EDUCATIONAL SOCIETY, RAMPACHODAVARAM 6 10. IN THE RESULT, BOTH THE APPEALS FILED BY THE AS SESSEE IS ITA NOS.744 & 745/VIZAG/2013 ARE ALLOWED FOR STATISTICAL PURPOS ES. THE ABOVE ORDER WAS PRONOUNCED IN THE OPEN COURT ON 22 ND JUL16. SD/- SD/- ( . ) ( . ) (G. MANJUNATHA) (V. DURGA RAO) /ACCOUNTANT MEMBER /JUDICIAL MEMBER ! /VISAKHAPATNAM: % /DATED : 22.07.2016 VG/SPS '! (! /COPY OF THE ORDER FORWARDED TO:- 1. / THE APPELLANT SRADDAHA EDUCATIONAL SOCIETY, D. NO.3-192, MAIN ROAD, RAMPACHODAVARAM 2. / THE RESPONDENT THE CIT, RAJAHMUNDRY RANGE, RAJ AHMUNDRY 3. ) / THE CIT, RAJAHMUNDRY 4. ) ( ) / THE CIT(A), RAJAHMUNDRY 5. ! , , , , ! / DR, ITAT, VISAKHAPATNAM 6 . / GUARD FILE / BY ORDER // TRUE COPY // /0 , (SR.PRIVATE SECRETARY) , , ! / ITAT, VISAKHAPATNAM