DR DEO SEVASHRAM, MUZAFFARPUR V. CIT-EXEMPTION, PATNA

ITA 8/PAT/2020

• Counselvise Citation: [2021] 104 COUNSELVISE.COM (IT) 5792 (ITAT-PATNA)
• Duration Of Justice: 1 year(s) 10 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-12-2021
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: DB
• Assessment Year: misc
• Appeal Filed On: 03-02-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 80G; 12AA

Judgement Text

1 ITA No.08/Pat/2020 Dr. Deo Sevashram IN THE INCOME TAX APPELLATE TRIBUNAL PATNA BENCH VIRTUAL HEARING AT KOLKATA [BEFORE SHRI ABY. T. VARKEY, JUDICIAL MEMBER & SHRI RAJESH KUMAR, ACCOUNTANT MEMBER] I.T.A. No. 08/Pat/2020 Dr. Deo Sevashram (PAN: AADTD3575G) Vs. CIT(Exemption), Patna Appellant Respondent Date of Hearing (Virtual) 20.12.2021 Date of Pronouncement 22.12.2021 For the Appellant Shri K.K. Choudhary, C.A. For the Respondent Shri Sanjay Mukherjee, CIT, DR ORDER PER SHRI A.T. VARKEY, JM: This is an appeal preferred by the assessee against the order of the Ld. CIT(Exemption), Patna dated 12.12.2019 wherein he has rejected the application for grant of registration u/s 12AA of the Act. 2. At the outset, the Ld. Counsel for the assessee, Shri K.K. Choudhary brought to our notice that the Ld. CIT(E) has not granted the registration merely because the assessee could not bring to his notice any activity that has been undertaken by the assessee. Therefore, Ld. CIT(E) was of the opinion that the genuineness of the activities of the trust/society could not be established. Therefore, he rejected the grant of registration u/s 12AA of the Act. Aggrieved by the aforesaid action of the Ld. CIT(E), the assessee is before us. 3. We have heard both the parties and also perused the records. We do not countenance the action of the Ld. CIT(E) to reject the application for registration u/s 12AA of the Act merely because the assessee had not undertaken any activity for 2 ITA No.08/Pat/2020 Dr. Deo Sevashram which purpose it had been constituted. It has been brought to our notice that the assessee has filed the application for registration of 12AA of the Act within two months after registering the trust. According to the Ld. Counsel, the assessee has been formed for undertaking charitable/philanthropic activity and so it applied for registration u/s 12AA of the Act and thereafter, it intends to seek approval u/s 80G of the Act. According to Ld. Counsel, the donors do not give donation to the assessee trust for carrying out the charitable unless it was granted registration u/s 12AA of the Act and section 80G of the Act. Therefore, the assessee trust applied for registration which has been denied. Therefore the assessee is before us. 4. According to us, when it comes to grant of registration of 12AA of the Act, the Ld. CIT(E) is only to verify the objects of the trust and the genuineness of the activities, meaning thereby that he has to satisfy himself that the objects are charitable in nature and the activities being carried on or to be carried on are genuine. Meaning thereby that they are in consonance for achieving of charitable objects and nothing else. In this case, the assessee after getting registered as a trust within two months applied for registration u/s 12AA of the Act and therefore, it did not commence its activities. According to assessee, the objects for which it has been constituted is charitable activities which is evident from perusal of the trust deed itself; and only after registration u/s 12AA and thereafter u/s 80G of the Act, the assessee trust would be able to get the donation from donors and able to commence the charitable activities. Therefore, in our opinion, in the facts and circumstance of the instant case, the Ld. CIT(A) at the time of registration u/s 12AA should not have insisted on the history of its activities rather should have looked into the objects of the assessee trust and if he finds that the objects are charitable in nature and the activities to be carried on are in consonance for achieving charitable objects for which it was constituted, then Ld. CIT(E) has to grant registration u/s 12AA of the Act. With the aforesaid observation, we set aside the impugned order of the Ld. CIT(E) and restore the application for registration u/s 12AA of the Act before the Ld. CIT(E) for de novo consideration in the light of the observation given above. The assessee to file the trust- 3 ITA No.08/Pat/2020 Dr. Deo Sevashram deed and other documents sought by the Ld. CIT(E) and explain its objectives and future activities it proposes to do and the Ld. CIT(E) to decide the application in accordance to law. 5. In the result, the appeal of the assessee is allowed for statistical purpose. Order is pronounced in the open court on 22 nd December, 2021 Sd/- Sd/- (Rajesh Kumar) (A.T. Varkey) Accountant Member Judicial Member Dated: 22.12.2021 Biswajit, Sr. PS Copy of the order forwarded to: 1. Appellant- Dr. Deo Sevashram, Majhou Road, Naya Tola, Muzaffarpur, Bihar – 842001. 2. Respondent – CIT(Exemption), Patna. 3. The CIT(A) 4. CIT- 5. DR, True Copy By Order Senior Private Secretary ITAT, Kolkata Benches, Kolkata