Lokmanya wachnalaya,Arvi., Wardha V. Commissioner of Income Tax-II, Nagpur

ITA 84/NAG/2011

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 3083 (ITAT-NAGPUR)
• Duration Of Justice: 7 year(s) 11 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-04-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: misc
• Appeal Filed On: 28-04-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SHARDHA NICHHAL ACIT
• Assessee Lawyers: S W DESPANDE
• Keywords: Charitable institution
• Section: 80G; 12A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL NAGPUR E-BENCH, NAGPUR (THROUGH VIDEO CONFERENCE AT MUMBAI) . . , . / , . . BEFORE SHRI R.K. GUPTA, JUDICIAL MEMBER /AND SHRI RAJENDRA, ACCOUNTANT MEMBER . / ITA NO. 84/NAG/2011 LOKMANYA WACHANALAYA, ARVI - DIST., WARDHA. PAN: AAATL 4147 K VS. COMMISSIONER OF INCOME TAX-II, 2 ND FLOOR, SARAF CHAMBERS, MOUNT ROAD, SADAR NAGPUR. ( / APPELLANT ) ( / RESPONDENT ) / APPELLANT BY : SMT. S.W. DESPANDE / RESPONDENT BY : SMT. SHARDHA NICHHAL (ACIT) ! '#$ / DATE OF HEARING : 21-01-2013 %&' '#$ / DATE OF PRONOUNCEMENT : 21-01-2013 () / O R D E R PER RAJENDRA, AM THE APPELLANT, A PUBLIC BODY FORMED IN THE YEAR 186 5 IN ARVI-DISTRICT WARDHA, HAS FILED THIS APPEAL AGAINST THE ORDER DT. 06-04-2 010 OF THE CIT-II, NAGPUR RAISING FOLLOWING GROUNDS OF APPEAL: I. THE APPELLANT LIBRARY IS A PUBLIC CHARITABLE TRUST DIFFUSING EDUCATION BY MAKING AVAILABLE BOOKS, JOURNALS, NEWS PAPERS ETC. WHICH IS OF GENERAL PUBLIC UTILITY AND FULFILS THE EXPLANATION AS MENTIONED IN SECTION 2(15) AND SECTION 80G OF THE INCOME TAX ACT, 1961 AS HAS BEEN INTERPR ETED AND EXPLAINED BY HONBLE THE SUPREME COURT OF INDIA. II. ON EARLIER OCCASIONS REGISTRATION UNDER SECTION 80G OF INCOME TAX ACT WAS GRANTED AND THERE IS NO CHANGE OF WHATSOEVER NATURE IN THE FUNCTIONING OF THE APPELLANT LIBRARY. III. FURTHER MORE EXPLAINED IN DETAIL IN MEMO OF APPEAL. 2. THE BRIEFLY STATED FACTS ARE AS UNDER: ON 30-10-2009 APPLICANT-TRUST FILED AN APPLICATION FOR GRANT OF RENEWAL OF EXEMPTION CERTIFICATE U/S. 80G OF THE INCOME-TAX AC T,1961 (ACT) ALONG WITH ITA NO. 84/NAG/2011 LOKMANYA WACHANALAYA 2 ENCLOSURES. AFTER GOING THROUGH THE RECORDS, CIT- II, NAGPUR HELD THAT THE ACTIVITY OF RUNNING LIBRARY PER SE DID NOT AMOUNT TO ANY CHARIT ABLE ACTIVITY, THAT THE FACILITY OF LIBRARY WAS EXTENDED TO ONLY THOSE PERSONS WHO AGRE ED TO PAY REGULARLY THE SUBSCRIPTION AS FIXED BY THE TRUST, THAT SERVICES O F THE TRUST IN THE SHAPE OF LIBRARY WERE AVAILABLE TO GENERAL PUBLIC AT A COST, THAT TR UST-DEED DID NOT SPECIFY OR SPEAK OF ANY UNDER-PRIVILEGED/WEAKER SECTION OF THE SOCIETY, SO AS TO QUALIFY AS A CHARITABLE INSTITUTION.CIT REFERRED TO CLAUSE-3(2) OF THE CONS TITUTION OF THE TRUST. FINALLY, RENEWAL OF EXEMPTION U/S. 80G(5) OF THE ACT WAS REF USED BY THE CIT UNDER SECTION 80G(5)(VI) READ WITH SECTION 11AA(5) OF THE ACT VID E F.NO.CIT-II/NGP/TECH/80G/L- 52/2009-10. 3. BEFORE US, AR SUBMITTED THAT LIBRARY WAS A PUBLIC T RUST, THAT REGISTRATION WAS GRANTED ON EARLIER OCCASIONS, THAT THERE WAS NO CHA NGE IN FACTS AND CIRCUMSTANCES, THAT TRUST WAS CARRYING OUT CHARITABLE ACTIVITIES. DEPA RTMENTAL REPRESENTATIVE (DR) RELIED UPON THE ORDER OF THE CIT. 3.1. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON FILE. FACTS GATHERED FROM THE RECORDS REVEAL THAT A LIBRARY STATED FUNCTIONING AT ARVI IN THE YEAR 1901. ON15-11-2007 LIBRARY WAS REGISTERED AS A PUBLIC TRUST. IN JULY 1962, LIBRARY WAS REGISTERED AS PUBLIC CHARITABLE TRUST U NDER BOMBAY PUBLIC TRUST ACT, 1950. IN DECEMBER 1982, LIBRARY WAS REGISTERED U/ S. 12A OF THE ACT AND IT WAS ALSO REGISTERED U/S. 80G OF THE ACT AS PUBLIC CHARITABLE TRUST BEARING REGISTRATION NO. 80G/80-G/WRD/27/82-83.AGAIN IN THE YEAR 2004, LIBRA RY WAS REGISTERED U/S. 80G OF THE ACT. ON 29-10-2009, WHEN THE LIBRARY APPLIED F OR REGISTRATION FOR GRANT OF REGISTRATION U/S. 80G OF THE ACT, CIT-II, NAGPUR RE JECTED THE APPLICATION FILED BY IT, AS STATED EARLIER. 3.2. WE FIND THAT AS PER THE CIT, RUNNING LIBRARY PER SE DID NOT AMOUNT TO ANY CHARITABLE ACTIVITY. CIT HAS NOT DISCUSSED ANYTHIN G ABOUT THE REGISTRATION GRANTED ON EARLIER OCCASION TO THE LIBRARY. IT IS NOT THE CAS E OF THE CIT THAT CLAUSE 3(2) OF THE CONSTITUTION OF THE TRUST WAS INTRODUCED FOR THE FI RST TIME. IF THE SAME FACTS WERE EXISTING IN EARLIER YEARS, IN OUR OPINION, THERE WA S NO NEED FOR REFUSING THE REGISTRATION TO THE LIBRARY. CONSISTENCY SHOULD BE MAINTAINED IN TAX MATTERS AND ESPECIALLY WHEN SIMILAR FACTS EXIST IN LATER YEARS AND THERE IS NO SUBSTANTIAL CHANGE IN FACTS AND CIRCUMSTANCES WITH REGARD TO AN ISSUE OR THERE IS N O CHANGE IN LEGAL POSITION BECAUSE OF SOME AMENDMENT IN THE ACT. WE DO NOT FIND ANY OF THESE EVENTUALITIES IN THE CASE UNDER CONSIDERATION. 3.3 . SECONDLY, IN OUR HUMBLE OPINION, FOR CARRYING OUT CHARITABLE WORK BY AN INSTITUTION, MENTIONING OR SPECIFYING UNDER-PRIVILE GED /WEAKER SECTIONS OF THE SOCIETY IN THE TRUST-DEED IS NOT AT ALL A PRE-CONDITION. BA SICALLY, CHARITY REQUIRES SELF-LESS DEED DEDICATED TO A GROUP OF PEOPLE AND THERE SHOULD NOT BE A PROFIT MOTIVE IN CARRYING OUT SUCH ACTIVITIES. WORD CHARITY IS NOT CONFINED TO A PARTICULAR CLASS OF PEOPLE-IT IS INCLUSIVE OF MANY ACTIVITIES RELATED TO HUMAN LIFE. COURTS ARE OF THE OPINION EVEN IF SOME COMMERCIAL ACTIVITIES ARE CARRIED OUT BY A TRU ST AND THE PROFIT GENERATED FROM SUCH ACTIVITIES IS USED IN CHARITABLE ACTIVITIES SU CH INSTITUTION HAS TO BE CONSIDERED CHARITABLE ENTITY. THEREFORE, IN OUR OPINION PROVI DING FACILITY TO MEMBERS BY CHARGING SOME SUBSCRIPTION DOES NOT DISENTITLE THE LIBRARY F OR CLAIMING REGISTRATION U/S.80 G OF THE ACT OR MAKE IT A NON-CHARITABLE ORGANISATION. L IBRARY IS A PLACE WHERE NEWS PAPERS, MAGAZINES AND BOOKS ARE KEPT FOR READING BY GENERAL PUBLIC. THEREFORE, ITA NO. 84/NAG/2011 LOKMANYA WACHANALAYA 3 INSTITUTIONS IMPARTING KNOWLEDGE, IN OUR OPINION, H AVE TO BE RECOGNISED CHARITABLE INSTITUTIONS. CASE LAWS RELIED BY THE ASSESSEE-TRU ST BEFORE THE FAA [ADDL. CIT VS. SURAT ART SILK CLOTH MANUFACTURES ASSOCIATION (AIR 1980 SC. 387); CIT VS. AP STATE ROAD TRANSPORT CORPORATION (AIR 1986 SC 1054); CIT VS. GUJRAT MARITIME BOARD (2007 AIR SCW 7912); VICTORIA TECHNICAL INSTITUTE V S. ADDL. COMMISSIONER OF INCOME TAX (1991) [94 CTR (SC) 153]; CIT VS. RAJNEE SH FOUNDATION (2005)[199 CTR (BOM) 491]; SHRI SARDARMAL SANCHETI CHARITABLE TRUST VS. UNION OF INDIA & ANR. (2009) [222 CTR (RAJ) 617] AND UMAID CHARITABL E TRUST VS. UNION OF INDIA & ORS. (2008) 218 CTR (RAJ) 31] SUPPORT THE SUBMISSIONS MADE BY THE APPELLANT-TRU ST. IN SHORT, WE ARE OF THE OPINION THAT APPELLANT-LIBR ARY IS A PUBLIC CHARITABLE TRUST AND IS COVERED BY THE GENERAL PUBLIC UTILITY AS ENVISAGED BY SECTION 2(15) OF THE ACT. THEREFORE, CIT-II, NAGPUR IS DIRECTED TO GRANT REGI STRATION U/S. 80G(5)(VI) OF THE ACT TO LOKMANYA WACHANALAYA, ARVI DIST., WARDHA. AS A RESULT, APPEAL FILED BY THE APPELLANT-TRUST S TANDS ALLOWED. * +, - +/ ' 01. ORDER PRONOUNCED BY E-BENCH AT MUMBAI ON THIS 21 ST DAY OF JANUARY, 2013 +3! 4,' ! - 356 7 21 # 2013 & () %&8'' 9 . SD/- SD/- ( . . / R.K. GUPTA ) ( / RAJENDRA ) (, / JUDICIAL MEMBER $ (, / ACCOUNTANT MEMBER +3! MUMBAI, 9( DATE: 21 ST JANUARY, 2013 TNMM COPY TO: 1. APPELLANT 2. RESPONDENT 3. THE CONCERNED CIT (A) 4. THE CONCERNED CIT 5. DR, ITAT, NAGPUR 6. GUARD FILE 8' ' //TRUE COPY// BY ORDER, ASST. REGISTRAR, ITAT