Rasikbapa Rotalawala Charitable Trust, PORBANDAR V. The Commissioner of Income Tax, JAMNAGAR

ITA 82/RJT/2013

• Counselvise Citation: 8224914 RSA 2013
• Duration Of Justice: 8 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-12-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 29-11-2013
• Assessment Year: misc
• Appeal Filed On: 09-04-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DR M L MEENA
• Assessee Lawyers: J C RANPURA
• Keywords: Charitable institution
• Section: 12AA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBULAL, SMC BENCH, RAJKOT BEFORE SHRI T. K. SHARMA, JM ITA NO. 82/RJT/2013 RASIKBAPA ROTALAWALA CHARITABLE TRUST, 16-BHAVSINHJI PARK, 1 ST FLOOR, PORBANDAR PAN : AABTR 9625 B ( / APPELLANT) THE COMMISSIONER OF INCOME-TAX JAMNAGAR / RESPONDENT / ASSESSEE BY SHRI J C RANPURA, CA / REVENUE BY DR M L MEENA, DR / DATE OF HEARING 29.11.2013 !'# / DATE OF PRONOUNCEMENT 13.12.2013 / ORDER THIS APPEAL BY THE ASSESSEE-TRUST IS AGAINST THE OR DER DATED 25.02.2013 OF COMMISSIONER OF INCOME-TAX, JAMNAGAR REFUSING TO GR ANT REGISTRATION SOUGHT BY THE ASSESSEE-TRUST U/S 12AA OF THE INCOME-TAX ACT, 1961 . 2. THE FACTS, IN BRIEF, ARE THAT THE ASSESSEE-TRUST WAS CREATED ON 01.06.2012. IT IS REGISTERED UNDER THE BOMBAY PUBLIC TRUST ACT, 1950 WITH THE ASST. CHARITY COMMISSIONER, JAMNAGAR VIDE REGISTRATION NO.E-971/P ORBANDAR DTD. 01.06.2012. THE ASSESSEE-TRUST HAS MADE AN APPLICATION FOR REGISTRA TION U/S 12A(A) OF THE INCOME-TAX ACT ON 13.08.2012. ON VERIFICATION OF THE TRUST DE ED, THE LD COMMISSIONER OF INCOME- TAX, JAMNAGAR OBSERVED THAT TRUST DEED DOES NOT CON TAIN PROVISIONS IN THE EVENT OF ITS DISSOLUTION TO THE EFFECT THAT UPON THE DISSOLUTION , IF ANY PROPERTY REMAINS AFTER SATISFACTION OF ITS DEBTS AND LIABILITIES, THE SAME SHALL BE TRANSFERRED TO THE TRUST HAVING SIMILAR OBJECTS. HE, THEREFORE, REFUSED TO GRANT REGISTRATION FOR THE DETAILED REASON GIVEN IN PARAGRAPH NO. 5 OF THE IMPUGNED ORD ER, WHICH READ AS UNDER:- 5. IN RESPONSE, THE TRUST HAS SUBMITTED SOME DETAI LS REGARDING ACTIVITIES OF THE TRUST. HOWEVER, THE TRUST DID NOT EXPLAIN ANYTH ING ABOUT THE NON- EXISTENCE/NON-INCLUSION OF DISSOLUTION CLAUSE, SINC E THE TRUST DEED DOES NOT CONTAIN PROVISIONS IN THE EVENT OF ITS DISSOLUTION TO THE EFFECT THAT UPON THE DISSOLUTION, IF ANY PROPERTY REMAINS AFTER SATISFAC TION OF ITS DEBTS AND LIABILITIES, THE SAME SHALL BE TRANSFERRED TO THE TRUST HAVING S IMILAR OBJECTS, THE APPLICANT TRUST IS NOT FOUND TO BE FULFILLING THE CONDITIONS LAID DOWN UNDER THE ACT. THEREFORE, REGISTRATION SOUGHT U/S 12A(A) OF THE AC T CAN NOT BE GRANTED. HOWEVER, THE TRUST MAY MAKE A FRESH APPLICATION FOR REGISTRATION U/S 12AA WITH REQUISITE MODIFICATION IN THE TRUST DEED AND AFTER RECTIFICATION OF THE ABOVE REFERRED LACUNAS, IF IT WISHES SO. AGGRIEVED WITH THE ORDER OF LD. COMMISSIONER OF IN COME-TAX, JAMNAGAR, THE ASSESSEE IS NOW IN APPEAL BEFORE THIS TRIBUNAL, ON THE FOLLOWING GROUNDS:- 2 82-RJT-2013 - RASIKBAPA ROTALAWALA CHARITABLE TRUST (SMC) 1.0 THE GROUNDS OF APPEAL MENTIONED HEREUNDER ARE WITHOUT PREJUDICE TO ONE ANOTHER. 2.0 THE LEARNED COMMISSIONER OF INCOME TAX, JAMNAGA R [HEREINAFTER REFERRED TO AS THE CIT] ERRED ON FACTS AS ALSO IN LAW IN REJECTING THE APPLICATION FOR REGISTRATION U/S 12A(A) OF THE ACT ALLEGING THA T THE TRUST DEED DOES NOT CONTAIN PROVISIONS IN THE EVENT OF ITS DISSOLUTION TO THE EFFECT THAT THE UPON THE DISSOLUTION, IF ANY PROPERTY REMAINS AFTER SATISFAC TION OF DEBT AND LIABILITIES, THE SAME SHALL BE TRANSFERRED TO THE TRUST HAVING SIMIL AR OBJECT. 3.0 THAT ON FACTS AS ALSO IN LAW SINCE THE TRUST DE ED CONTAINS THE RELEVANT PROVISION THAT IN THE EVENT OF DISSOLUTION OF TRUS T, THE RELEVANT PROVISIONS OF THE ACT (TRUST ACT) SHALL BE FOLLOWED, THE LD. CIT WAS NOT JUSTIFIED IN REJECTING THE APPLICATION OF THE APPELLANT. 4.0 YOUR HONOURS APPELLANT CRAVES LEAVE TO ADD, TO AMEND, ALTER, OR WITHDRAW ANY OR MORE GROUNDS OF APPEAL ON OR BEFORE THE HEARING OF APPEAL. 3. AT THE TIME OF HEARING, ON BEHALF OF THE ASSESSE E-TRUST, SHRI J.C. RANPURA, CA, APPEARED AND POINTED OUT THAT THE DISSOLUTION CLAUS E DOES EXIST IN THE ORIGINAL FINAL TRUST DEED OF THE ASSESSEE-TRUST; HOWEVER, HE CLARI FIED THAT THROUGH OVERSIGHT DRAFT COPY OF THE TRUST DEED WAS SUBMITTED BEFORE THE LD. CIT, WHEREIN DISSOLUTION CLAUSE WAS NOT AVAILABLE. IN SUPPORT OF HIS CLAIM, HE FILE D A PAPER-BOOK CONTAINING 27 PAGES BEFORE THE TRIBUNAL, WHICH INTER-ALIA INCLUDING CER TIFIED COPY OF THE TRUST DEED AS OBTAINED FROM THE OFFICE OF THE ASSST. CHARITY COMM ISSIONER, PORBANDAR ALONGWITH ITS FREE ENGLISH TRANSLATION, TRUST REGISTRATION CERTI FICATE UNDER MUMBAI PUBLIC TRUST ACT, 1950 ETC.. THE LD. COUNSEL OF THE ASSESSEE FU RTHER SUBMITTED THAT SINCE THE GROUND OF REJECTION OF ASSESSEE-TRUSTS APPLICATION U/S 12AA WAS PURELY BASED ON THE ABSENCE OF PROVISION IN THE EVENT OF DISSOLUTION/WI NDING-UP CLAUSE IN THE TRUST DEED WHICH WAS CAUSED BY THE INADVERTENT MISTAKE ON THE PART OF ASSESSEE-TRUST FOR NOT SUBMITTING THE FINAL TRUST DEED BEFORE THE LD. CIT, THE LD. CIT BE DIRECTED TO GRANT THE REGISTRATION U/S 12AA OF THE INCOME-TAX ACT, 1961. 4. AS AGAINST THE AFORESAID SUBMISSION MADE BY THE LD. COUNSEL OF THE ASSESSEE- TRUST, THE LD. DEPARTMENTAL REPRESENTATIVE SUPPORTE D THE ORDER OF LD. CIT AND CONTENDED THAT THE ORIGINAL FINAL TRUST DEED, WHICH WAS PRODUCED BY THE ASSESSEE- TRUST BEFORE THE TRIBUNAL, WAS NOT AVAILABLE WITH T HE LD. COMMISSIONER OF INCOME-TAX, JAMNAGAR, THEREFORE THE VIEW TAKEN BY HIM BE UPHEL D. 5. AFTER HEARING BOTH THE SIDES, I HAVE CAREFULLY G ONE THROUGH THE IMPUGNED ORDER OF LD. COMMISSIONER OF INCOME-TAX, JAMNAGAR. IT IS PERTINENT TO NOTE THAT, WHILE GOING THROUGH THE DOCUMENTS SUBMITTED BY THE ASSESSEE-TRU ST BEFORE THE TRIBUNAL, THE FINAL 3 82-RJT-2013 - RASIKBAPA ROTALAWALA CHARITABLE TRUST (SMC) TRUST DEED CONTAINS THE DISSOLUTION/WINDING-UP PROV ISION TO THE EFFECT THAT UPON DISSOLUTION, IF ANY PROPERTY REMAINS AFTER SATISFAC TION OF ITS DEBTS AND LIABILITIES, THE SAME SHALL BE TRANSFERRED TO THE TRUST HAVING SIMIL AR OBJECTS IN PARAGRAPH NO. 25 OF ITS TRUST DEED. IT IS ALSO RELEVANT HERE TO POINT OUT THE MISTAKE COMMITTED BY THE ASSESSEE-TRUST WHILE SUBMITTING THE TRUST DEED, WHI CH WAS INADVERTENTLY DRAFT COPY, BEFORE THE LD. CIT. HOWEVER, IN THE INTEREST OF J USTICE, I SET ASIDE THE IMPUGNED ORDER AND DIRECT THE LD. COMMISSIONER OF INCOME-TAX, JAMN AGAR TO PASS A FRESH ORDER ON THE APPLICATION OF THE ASSESSEE-TRUST FOR REGISTRAT ION U/S 12AA OF THE INCOME-TAX ACT. THE ASSESSEE IS A CHARITABLE TRUST AND ISSUANCE OF REGISTRATION U/S 12AA IS A PRIMARY CONDITION FOR THE START OF THE CHARITABLE ACTIVITY OF THE TRUST, THEREFORE ITS CASE HAS TO BE DECIDED ON PRIORITY BASIS. I, THEREFORE, DIRECT THE ASSESSEE-TRUST TO SUO MOTU APPEAR BEFORE THE LD COMMISSIONER OF INCOME-TAX, JAMNAGAR WITHIN 15 DAYS ON RECEIPT OF THIS ORDER OF THE TRIBUNAL WITHOUT WAITING FOR ANY NOTIC E FROM THE REVENUE DEPARTMENT AND SUBMIT FINAL TRUST DEED OF THE TRUST TO LD. COMMISS IONER OF INCOME-TAX, JAMNAGAR WHO WILL VERIFY THE SAME AND PASS AN APPROPRIATE ORDER AS PER LAW AS DEEMED FIT WITHIN A REASONABLE TIME. WITH THESE DIRECTIONS, ASSESSEES APPEAL IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES. 6. IN THE RESULT, APPEAL OF THE ASSESSEE IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES. THIS ORDER PRONOUNCED IN OPEN COURT ON THE DATE MEN TIONED HEREINABOVE. SD/- ( $.. &' / T. K. SHARMA) ( ) /JUDICIAL MEMBER *)& +) ,/ ORDER DATE: 13.12.2013 !$ /RAJKOT *BT / COPY OF ORDER FORWARDED TO:- 1. / APPELLANT- RASIKBAPA ROTALAWALA CHARITABLE TRUST , 16-BHAVSINHJI PARK, 1 ST FLOOR, PORBANDAR 2. / RESPONDENT- THE COMMISSIONER OF INCOME-TAX, JAMN AGAR 3. ,0,1 * * 2 / CONCERNED JT. CIT, RANGE 2, JAMNAGAR 4 . 345 1, * 1#, !$ / DR, ITAT, RAJKOT 5 . 57 89 / GUARD FILE *)& / BY ORDER TRUE COPY PRIVATE SECRETARY, ITAT, RAJKOT