Paramount Educational Charitable Trust, Ambala V. CIT, Panchkula

ITA 802/CHANDI/2014

• Counselvise Citation: [2015] 120 COUNSELVISE.COM (IT) 9783 (ITAT-CHANDIGARH)
• Duration Of Justice: 7 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-05-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 06-05-2015
• Assessment Year: misc
• Appeal Filed On: 16-09-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DR AMA RVEER SINGH
• Keywords: Charitable institution
• Section: 12A; 12AA; 6

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCH B, CHANDIGARH BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI T.R.SOOD, ACCOUNTANT MEMBER ITA NO. 802/CHD/2014 (UNDER SECTION 12AA(1)(B) OF THE ACT) PARAMOUNT EDUCATION CHARITABLE TRUST, VS. THE C.I.T., VILL. AKBARPUR, TEH. NARAINGARH, PANCHKULA. DISTT. AMBALA. PAN: AABTP5456E (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI SUDHIR SEHGAL RESPONDENT BY : DR.AMARVEER SINGH, DR DATE OF HEARING : 06.05.2015 DATE OF PRONOUNCEMENT : 07.05.2015 O R D E R PER BHAVNESH SAINI, J.M. : THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF LEARNED COMMISSIONER OF INCOME TAX, PANCHKULA DATED 11.8.2014, REJECTING THE APPLICATION FOR REGISTRATION UNDER SECTION 12AA OF THE INCOME TAX ACT. 2. BRIEFLY, THE FACTS OF THE CASE ARE THAT THE ASS ESSEE TRUST WAS CREATED ON 28.5.2007 AND THE TRUST HAS BE EN REGISTERED WITH THE JOINT/DY.REGISTRAR NARAINGARH V IDE REGISTRATION NO.682 DATED 28.5.2007. THE ASSESSEE T RUST HAS FILED 2 APPLICATION FOR REGISTRATION UNDER SECTION 12A OF T HE ACT IN PRESCRIBED FORM. IN ORDER TO VERIFY THE GENUINENE SS OF THE ACTIVITIES OF THE ASSESSEE TRUST, THE REPORT OF THE ASSESSING OFFICER WAS CALLED FOR VIDE LETTER DATED 31.3.2014. THE ASSESSING OFFICER VIDE HIS REPORT DATED 18.7.2014 R EPORTED THAT THE AIMS AND OBJECTS OF THE ASSESSEE TRUST ARE AS UNDER : I) TO ESTABLISH, MAINTAIN, CARRY ON EDUCATION INSTITUTION ANY STATE. II) TO LOOK AFTER AND MANAGE THE ADDAIRS OF PARAMOUN T CONVENT SCHOOL SITUATED AT AKBARPUR AMBALA. III) TO GIVE INSTRUCTIONS VIVA VOCE OR BY POST TO BO TH SEXES, IRRESPECTIVE OF CASTE, CREED ETC. FOR THE PURPOSE O F TEACHING IN ARTS, SCIENCE STUDIES RELATING TO SPORTS, COUNTING AN D BOOK KEEPING, TYPE WRITING AND STENO GRAPHY, TO MAKING, LAW OF THE LAND INCLUDING COMMERCIAL AND LABOUR LAWS, MECHANIC AL AND ELECTRIC ENGINEERING AND ALSO WHAT SO EVER APPERTAINS TO TECHNICAL, VOCATIONAL, COMMERCIAL, CU LTURAL AND SCIENTIFIC EDUCATION. IV) TO ORGANIZE DEBATES, LECTURES, EXHIBITIONS, EXPEDITIO NS, RESEARCH WORK, DANCES, OPERAS, THEATRES, OUTDOOR AMUS EMENT AND EXCURSIONS, PUBLIC MEETING, CLASSES AND CONFERENCE S CALCULATED DIRECTLY AND INDIRECTLY TO ADVANCE THE CAUS E OF EDUCATION WHETHER GENERAL, PROFESSIONAL AND TECHNICAL. V) TO ARRANGE FOR THE CHILDREN STUDYING IN THE SCHOOL RUN BY THE TRUST BOTH FORMAL AND INFORMAL EDUCATION SO AS TO EQ UIP EACH CHILD WITH AN APPROPRIATE MODE ENABLING THEM TO BECOM E A GOOD CITIZEN OF INDIA. VI) TO INCULCATE THROUGH TEACHING AMONGST THE STUDENTS A 3 SENSE OF NATIONAL INTEGRATION AND UNFAILING RESPECT F OR THE COUNTRY AND ITS CONSTITUTION. 3. THE ASSESSING OFFICER IN HIS REPORT ALSO SUBMIT TED THAT THE ASSESSEE TRUST HAS FURNISHED COPIES OF THE RETURNS OF INCOME FOR THE LAST THREE YEARS ALONGWITH COPIES OF AUDITED BALANCE SHEET AND INCOME AND EXPENDITURE STATEMENT FOR THE YEAR ENDING ON 31.3.2011, 31.3.20 12 AND 31.3.2013. AS PER THE INCOME AND EXPENDITURE ACCOU NT OF THE ASSESSEE TRUST, THE EXPENDITURE MORE THAN 85% H AVE BEEN UTILIZED BY THE ASSESSEE TRUST. THE ASSESSIN G OFFICER HAS FURTHER REPORTED THAT THE INSPECTOR OF HIS OFFI CE WAS DEPUTED TO VISIT THE OFFICE OF THE ASSESSEE TRUST, WHO HAS REPORTED THAT THE ASSESSEE TRUST IS DOING CHARITABL E ACTIVITIES. NO COMMERCIAL ACTIVITIES ARE BEING RU N BY THE ASSESSEE TRUST. THUS THE AIMS AND OBJECTS OF THE ASSESSEE TRUST ARE OF GENERAL PUBLIC UTILITY AS WELL AS TO P ROVIDE EDUCATION AND ARE COVERED BY THE PROVISIONS OF SECT ION 2(15) OF THE INCOME TAX ACT. 4. THE LEARNED COMMISSIONER OF INCOME TAX ON THE BASIS OF MATERIAL ON RECORD AND REPORT OF THE ASSES SING OFFICER NOTED THAT THE ASSESSEE TRUST IS NOT REGIST ERED UNDER THE NEW HARYANA REGISTRATION & REGULATION OF SOCIET IES REGISTRATION ACT, 2012 AND ACCORDINGLY REJECTED THE APPLICATION FOR REGISTRATION. 5. WE HAVE HEARD THE LEARNED REPRESENTATIVES OF BO TH THE PARTIES AND PERUSED THE MATERIAL AVAILABLE ON R ECORD. 4 THE LEARNED COUNSEL FOR ASSESSEE CONTENDED THAT THE ASSESSEE HAS FULFILLED ALL THE CONDITIONS OF SECTIO N 12AA OF THE ACT AND SINCE THE ASSESSEE IS A TRUST AND REGIS TERED WITH THE REGISTRAR OF TRUST AND, THEREFORE, THE ASSESSEE NEED NOT TO GET REGISTRATION UNDER THE NEW HARYANA REGISTRAT ION & REGULATION OF SOCIETIES REGISTRATION ACT, 2012 BECA USE THE ASSESSEE IS NOT A SOCIETY. 6. ON THE OTHER HAND, THE LEARNED D.R FOR THE REVENUE RELIED UPON THE IMPUGNED ORDER. 7. ON CONSIDERATION OF THE FINDINGS GIVEN IN THE IMPUGNED ORDER, WE DO NOT FIND ANY REASON TO SUSTAI N THE IMPUGNED ORDER. AT THE STAGE OF GRANT OF REGISTRA TION OR REFUSAL TO GRANT REGISTRATION UNDER SECTION 12AA OF THE ACT, THE LEARNED COMMISSIONER OF INCOME TAX IS REQUIRED TO SATISFY HIMSELF ABOUT THE OBJECTS OF THE TRUST OR I NSTITUTION AND THE GENUINENESS OF ITS ACTIVITIES. THE LEARNE D COMMISSIONER OF INCOME TAX CALLED FOR THE REPORT FR OM THE ASSESSING OFFICER. THE ASSESSING OFFICER HAS REPO RTED THAT THE AIMS AND OBJECTS OF THE ASSESSEE TRUST ARE OF G ENERAL PUBLIC UTILITY AS WELL AS TO PROVIDE EDUCATION AND ARE COVERED BY THE PROVISIONS OF SECTION 2(15) OF THE A CT. THE ASSESSING OFFICER ALSO REPORTED THE AIMS AND OBJECT S OF THE ASSESSEE TRUST AS REPRODUCED ABOVE, WHICH CLEARLY P ROVE THAT THE ASSESSEE EXISTED FOR CHARITABLE PURPOSES W ITHIN THE MEANING OF SECTION 2(15) OF THE ACT. THE ASSESSIN G OFFICER ALSO REPORTED THAT THE ASSESSEE HAS UTILIZED MORE T HAN 85% OF THE INCOME FOR ACHIEVING ITS AIMS AND OBJECTS. THEREFORE, 5 THE ASSESSEE TRUST SATISFIED THE CONDITIONS FOR GRA NT OF REGISTRATION UNDER SECTION 12AA OF THE ACT. THE L EARNED COMMISSIONER OF INCOME TAX ALSO DID NOT ADVERSELY C OMMENT UPON THE AIMS AND OBJECTS OF THE ASSESSEE TRUST AND GENUINENESS OF ACTIVITIES. THE ONLY REASON GIVEN BY THE LEARNED COMMISSIONER OF INCOME TAX FOR REJECTING TH E REGISTRATION APPLICATION WAS THAT THE ASSESSEE TRUS T IS NOT REGISTERED UNDER THE NEW HARYANA REGISTRATION & REG ULATION OF SOCIETIES REGISTRATION ACT, 2012. THIS MAY NOT BE THE REQUIREMENT UNDER SECTION 12AA OF THE ACT. FURTHE R THE ASSESSEE IS A REGISTERED TRUST, THEREFORE, NEED NOT TO GO FOR REGISTRATION UNDER THE SOCIETIES ACT. THE REASONS GIVEN BY THE LEARNED COMMISSIONER OF INCOME TAX ARE WHOLLY INCORRECT AND ALIEN TO THE PROVISIONS OF SECTION 12 AA OF THE ACT. THE MATERIAL BROUGHT ON RECORD BY THE LEARNE D COMMISSIONER OF INCOME TAX CLEARLY SUGGEST THAT THE ASSESSEE TRUST EXISTED FOR CHARITABLE ACTIVITIES O NLY. THEREFORE, THERE WAS NO REASON FOR THE LEARNED COMMISSIONER OF INCOME TAX TO DENY REGISTRATION TO THE ASSESSEE TRUST UNDER SECTION 12AA OF THE ACT. CON SIDERING THE ABOVE DISCUSSION, WE ARE OF THE VIEW THAT THE A SSESSEE TRUST IS ENTITLED FOR REGISTRATION UNDER SECTION 12 AA OF THE ACT. 8. WE ACCORDINGLY SET ASIDE THE IMPUGNED ORDER AND DIRECT THE LEARNED COMMISSIONER OF INCOME TAX, PANC HKULA TO GRANT REGISTRATION TO THE ASSESSEE TRUST UNDER S ECTION 6 12AA OF THE ACT AS PER LAW WITHIN ONE MONTH FROM TH E RECEIPT OF THIS ORDER. 9. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 7 TH DAY OF MAY, 2015. SD/- SD/- (T.R.SOOD) (BHAVNESH SAINI) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 7 TH MAY, 2015 *RATI* COPY TO: THE APPELLANT/THE RESPONDENT/THE CIT(A)/TH E CIT/THE DR. ASSISTANT REGISTRAR, ITAT, CHANDIGARH