Akbar National Awareness Foundation of India (ANAFI), Lucknow V. Commissioner of Income Tax, Lucknow

ITA 772/LKW/2014

• Counselvise Citation: 77223714 RSA 2014
• Duration Of Justice: 2 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-01-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2013-2014
• Appeal Filed On: 15-10-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: VIVEK MISHRA
• Keywords: Charitable institution; Opportunity of being heard; Principle of natural justice
• Section: 12AA

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH B, LUCKNOW BEFORE SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI A.K. GARODIA, ACCOUNTANT MEMBER ITA NO.772/LKW/2014 ASSESSMENT YEAR:2013 - 14 C.I.T., RANGE - II, LUCKNOW. VS AKBAR NATIONAL AWARENESS FOUNDATION OF INDIA, REGENCY AVADH BUILDING, NEEMBU BAGH COMPLEX, CHOWK, LUCKNOW. PAN:AACTA2430L (RESPONDENT) (APPELLANT) MOHD. ABDUL MANNAN, ADVOCATE APPELLANT BY SHRI VIVEK MISHRA, C.I.T., D. R. RESPONDENT BY 18/11/2014 DATE OF HEARING 07 /01/2015 DATE OF PRONOUNCEMENT O R D E R PER A. K. GARODIA, A.M. THIS IS AN ASSESSEES APPEAL DIRECTED AGAINST THE ORDER PASSED BY LEARNED CIT - II, LUCKNOW DATED 11/08/2014 PASSED BY HIM U/S 12AA OF THE ACT FOR THE ASSESSME NT YEAR 2013 - 2014. 2. THE GROUNDS RAISED BY THE ASSESSEE ARE AS UNDER: 1. BECAUSE THE APPELLANT TRUST IS PURELY A CHARITABLE TRUST AND THE BENEFICIARIES OF IT ARE THE PUBLIC AT LARGE. 2. BECAUSE THE ACTIVITIES OF THE TRUST ARE FULLY CHARITABLE AND ARE AS PER THE OBJECTS OF THE TRUST DEED. 2 3. BECAUSE THE APPELLANT TRUST HAS MAINTAIN ALL THE DOCUMENTS AS REQUIRED BY THE COMMERCIAL ACCOUNTING PROCEDURE OF A TRUST. 4. BECAUSE THE APPELLANT TRUST SUBMITTED ALL THE DOCUMENTS BEFORE THE ASSESSING AUTHORITY A S WELL AS BEFORE THE LD. CIT II BUT NO PARTICULAR ACTIVITY HAS BEEN INDICATED TO BE AGAINST CHARITABLE OBJECTS. 5. BECAUSE THE SAID LD. INCOME TAX AUTHORITIES MISERABLY FAILED TO APPRECIATE THE CHARITABLE OBJECTS OF THE APPELLANT ASSESSEE TRUST. 6. BECAU SE THE TWO CASES KIRTI CHAND TARAWATI CHARITABLE SOCIETY AND SELF EMPLOYERS SERVICE SOCIETY VS CIT ARE NOT RELEVANT TO THE FACTS OF THE APPELLANT ASSESSEE. 7. BECAUSE THE LD. CIT II BASED HIS JUDGMENT ON THE ABOVE TWO CASES WHICH ARE NOT RELEVANT TO THE C ASE OF THE APPELLANT ASSESSEE TRUST. 8. BECAUSE THE ALLEGATIONS THAT ACTIVITIES OF THE TRUST ARE NOT IN TANDEM WITH THE OBJECTS OF THE TRUST ARE WRONG AS NONE OF THE ACTIVITIES HAS BEEN INDICATED TO BE SO. 9. BECAUSE THE APPELLANT TRUST MAINTAINS EVERY R ECORD OF ITS EXPENDITURE AND OF THE PERSON WHOSE CHARITY HAS BEEN LOOKED AFTER FROM VOUCHERS TO APPLICATIONS. 10. BECAUSE IT IS ABSURD TO SAY THAT THE ACTIVITIES OF THE APPLICANT ARE NOT OPEN FOR VERIFICATION. 11. BECAUSE THE LD. CIT - II HAS FAILED TO AFFORD A REASONABLE OPPORTUNITY OF BEING HEARD TO THE APPELLANT ASSESSEE TRUST. 12. BECAUSE THE ORDER OF LD. CIT - II IS BAD IN LAW AND ON FACTS AND DESERVE TO BE REJECTED. 13. BECAUSE IF THE APPELLANT ASSESSEE IS NOT GIVEN THE RELIEF IT WILL BE AGAINST LAW AND NATURAL JUSTICE. 3 3. LEARNED A.R. OF THE ASSESSEE REITERATED THE SAME CONTENTIONS, WHICH WERE RAISED BEFORE LEARNED CIT. AS AGAINST THIS , LEARNED D.R. OF THE REVENUE SUPPORTED THE ORDER OF LEARNED CIT. 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE FIND THAT THE ISSUE IN DISPUTE WAS DECIDED BY LEARNED CIT AS PER PARA 4 TO 6 OF THE IMPUGNED ORDER, WHICH ARE REPRODUCED BELOW FOR THE SAKE OF READY REFERENCE: - 4. I HAVE CONSIDERED THE MATERIAL .AVAILABLE O N RECORDS, REPORT SUBMITTED BY THE JOINT COMMISSIONER OF INCOME - TAX, RANGE - VI, LUCKNOW AND ALSO THE DOCUMENTS FURNISHED ALONG WITH APPLICATION FOR GRANT OF REGISTRATION U/S 12AA OF THE INCOME - TAX ACT. ON PERUSAL OF SOCIETY'S MEMORANDUM IT IS SEEN THAT THER E ARE MORE THAN 100 OBJECTS UNDER 09 MAJOR HEADS. HOWEVER, THE PROFIT & LOSS ACCOUNTS FOR THE F.Y. 2012 - 13 SUBMITTED BY THE SOCIETY., SHOW THAT THE TRUST IS NOT INCURRING FUNDS FOR ACHIEVING ITS DECLARED OBJECTIVE. ACTIVITIES OF THE TRUST ARE NOT IN TANDEM WITH ITS BYELAWS, THEREFORE, ITS CLAIM IS NOT OPEN TO VERIFICATION. BOOKS OF ACCOUNTS MAINTAINED BY THE SOCIETY DO NOT FOUND INCONSONANCE WITH THE ACTIVITIES OF THE SOCIETY. FURTHER, THE GENUINENESS OF ACTIVITIES OF ASSESSEE ARE NOT IN CONSONANCE WITH CHA RITABLE PURPOSES. 5. THE JOINT COMMISSIONER OF INCOME - TAX, RANGE - VI, LUCKNOW AND THE ASSESSING OFFICER CONCERNED HAVE ALSO NOT RECOMMENDED THE CASE FOR REGISTRATION U/S 12AA(1)(B)(II) OF THE INCOME - TAX ACT, 1961. 6. ATTENTION IS ALSO DRAWN TO THE HON'BLE DELHI HIGH COURT'S JUDGMENT IN THE CASE OF KIRTI CHANDRA TARAWATI CHARITABLE SOCIETY VS. DIT (EXEMPTION) 232 ITR 11 IN WHICH IT WAS HELD THAT THERE IS NO OBLIGATION ON A CIT TO GRANT REGISTRATION TO A SOCIETY MERELY BY LOOKING AT THE INSTRUMENT CREATING T HE SOCIETY AND SHUTTING HIS EYES TO THE ACTUAL ACTIVITIES CARRIED OUT BY IT. A SIMILAR VIEW HAS BEEN EXPRESSED IN THE CASE OF SELF EMPLOYERS SERVICE SOCIETY VS. CIT 247 ITR 18 (KER.) WHEREIN IT WAS HELD THAT IF A SOCIETY PROPOSED TO 4 CARRY OUT CHARITABLE AC TIVITIES IN FUTURE, REGISTRATION EVEN U/S 12AA WOULD NOT BE AVAILABLE TO IT. FURTHER, THE GENUINENESS OF ACTIVITIES OF THE APPLICANT ARE NOT OPEN FOR VERIFICATION. IN VIEW OF THE ABOVE DECISIONS, I AM UNABLE TO ACCEPT DIE APPLICANT'S CLAIM. THEREFORE, I DO NOT FIND THE CASE FIT FOR GRANT OF REGISTRATION U/S 12A(1) OF THE INCOME - TAX ACT, 1961. 4.1 FROM THE ABOVE PARAS FROM THE ORDER OF LEARNED CIT, WE FIND THAT A CLEAR FINDING IS GIVEN BY HIM THAT THE TRUST IS NOT INCURRING FUNDS FOR ACHIEVING ITS DECLA RED ACTIVITIES AND THE ACTIVITIES ARE NOT IN TANDEM WITH ITS B YE - LAWS . IN THIS REGARD, WE FIND THAT A WRITTEN SUBMISSIONS WAS FILED BY THE ASSESSEE BEFORE LEARNED CIT, COPY OF WHICH IS AVAILABLE ON PAGES 39 TO 46 OF THE PAPER BOOK. THE ASSESSEE HAS ALSO FURNISHED DATE - WISE CHARTS AND EVENTS OF THE ASSESSEE. IT HAS BEEN SUBMITTED IN THE CHART REGARDING CHARITABLE ACTIVITIES THAT THE TRUST PROVIDED ALL INDIA WOMEN CONFERENCE DONATIONS FROM TIME TO TIME. IT IS ALSO STATED THAT THE TRUST PROVIDED HELP TO TH E GIRLS WHO WERE IN NEED TO CONTINUE THEIR EDUCATION. IT IS ALSO NOTED THAT THE TRUST PROVIDED FLOOD RELIEF TO SHRI BABU LAL AMOUNTING TO RS.10,000/ - ON 04/12/2008 AND AGAIN ON 10/12/2008 THE TRUST PROVIDED AID TO MRS. SHANTI WIFE OF MUNNA LAL OF RS.1,000 / - . THEREAFTER, ON 15/01/2009, RS.15,000/ - WAS INCURRED FOR FLOOD RELIEF BY WAY OF ROOF REPAIRING OF MATEEN FAROOQUI AND FOR SAME PURPOSE RS.10,000/ - WAS FURTHER INCURRED ON 15/02/2009. THERE ARE SO MANY ACTIVITIES NOTED IN THIS CHART, WHICH INCLUDES DON ATION TO MADARSA ALIA IRFANIA AMOUNTING RS.25,000/ - , DONATION TO NOOR FOUNDATION AMOUNTING TO RS.50,0000/ - ETC. THESE ACTIVITIES ARE NOT AT ALL CONSIDERED BY LEARNED CIT IN THE IMPUGNED ORDER AND THEREFORE, WE FEEL THAT THE MATTER SHOULD GO BACK TO HIS FI LE FOR FRESH DECISION AFTER CONSIDERING ALL THESE ASPECTS. WE, THEREFORE, SET ASIDE THE ORDER OF LEARNED CIT AND RESTORE THE MATTER BACK TO HIS FILE FOR FRESH DECISION. HE SHOULD 5 PASS A SPEAKING AND REASONED ORDER AFTER CONSIDERING ALL THE SUBMISSIONS OF THE ASSESSEE BEFORE HIM, WHICH HAVE BEEN ALREADY BROUGHT ON RECORD OR WHICH MAY BE BROUGHT ON RECORD NOW BEFORE HIM. NEEDLESS TO SAY, LEARNED CIT SHOULD PROVIDE REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 5. IN THE RESULT, THE APPEAL OF THE A SSESSEE STANDS ALLOWED FOR STATISTICAL PURPOSES. (ORDER WAS PRONOUNCED IN THE OPEN COURT ON THE DATE MENTIONED ON THE CAPTION PAGE) SD/. SD/. (SUNIL KUMAR YADAV) ( A. K. GARODIA ) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 07 / 01 /201 5 . *C.L.SINGH COPY OF THE ORDER FORWARDED TO : 1.THE APPELLANT 2.THE RESPONDENT. 3.CONCERNED CIT 4.THE CIT(A) 5.D.R., I.T.A.T., LUCKNOW ASSTT. REGISTRAR