Sri Kodandaramaswamy Temple, SPSR Nellore, Hyderabad V. CIT(Exemptions), Hyd, Hyderabad

ITA 89/HYD/2016

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 6446 (ITAT-HYDERABAD)
• Duration Of Justice: 4 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-06-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 03-05-2016
• Assessment Year: 2013-2014
• Appeal Filed On: 28-01-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R B NAIK
• Assessee Lawyers: A V RAGHURAM
• Keywords: Gift; Charitable institution
• Section: 12AA

Judgement Text

1 ITA.89/H/2016 SRI KODANDARAMASWAMY TEMPLE, TAMMINAPATNAM, CHILLAKUR (M), SPSR NELLORE. IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES A : HYDERABAD BEFORE SMT. P. MADHAVI DEVI, JUDICIAL MEMBER AND SHRI S. RIFAUR RAHMAN, ACCOUNTANT MEMBER ITA.NO.89/HYD/2016 ASSESSMENT YEAR 2013-2014 SRI KODANDARAMASWAMY TEMPLE, TAMMINAPATNAM, CHILLAKUR (M), SPSR NELLORE. PAN AAAJS4721L VS. CIT-(EXEMPTIONS) HYDERABAD. (APPELLANT) (RESPONDENT) FOR ASSESSEE : MR. A.V. RAGHURAM FOR REVENUE : MR. R.B. NAIK DATE OF HEARING : 03.05.2016 DATE OF PRONOUNCEMENT : 1 7 . 0 6 .2016 ORDER PER SMT. P. MADHAVI DEVI, J.M. THIS IS ASSESSEES APPEAL AGAINST THE REJECTION OF ASSESSEES APPLICATION FOR REGISTRATION UNDER SE CTION 12AA OF THE I.T. ACT, 1961. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE I S A VERY ANCIENT TEMPLE IN NELLORE DISTRICT AND UNDER THE ADMINISTRATIVE CONTROL OF ASSISTANT COMMISSIONER, ENDOWMENTS DEPARTMENT, NELLORE. THE TEMPLE IS ALSO REGISTERED UNDER SECTION 6(C)(II) OF THE ENDOWMENTS ACT AND THEREFORE, ITS AFFAIRS ARE MANAGED BY THE EXECU TIVE OFFICER OF THE TEMPLE APPOINTED BY THE DEPARTMENT O F ENDOWMENTS, GOVERNMENT OF ANDHRA PRADESH. THE DAY- 2 ITA.89/H/2016 SRI KODANDARAMASWAMY TEMPLE, TAMMINAPATNAM, CHILLAKUR (M), SPSR NELLORE. TO-DAY ADMINISTRATION OF THE TEMPLE IS CARRIED ON A S PER THE ESTABLISHED RULES AND REGULATIONS LAID DOWN BY THE DEPARTMENT OF ENDOWMENTS, GOVERNMENT OF A.P. THE ASSESSEE MADE AN APPLICATION FOR REGISTRATION UNDER SECTION 12A(1) OF THE ACT BY FILING AN APPLICATION IN FORM- 10A ALONG WITH THE CERTIFICATE ISSUED BY THE ASSIST ANT COMMISSIONER, ENDOWMENTS DEPARTMENT, NELLORE WITH RESPECT TO THE STATUS OF THE INSTITUTION AND THE FI NANCIAL STATEMENTS FOR THE A.YS. 2009-10 TO 2011-12. THE CI T(E), AFTER EXAMINING THE APPLICATION OF THE ASSESSEE, RE JECTED THE SAME HOLDING THAT THE ASSESSEE HAS FAILED TO PR ODUCE THE TRUST DEED ALONG WITH THE APPLICATION IN FORM-1 0A AS ACCORDING TO HIM, IT IS MANDATORY FOR SEEKING REGIS TRATION UNDER SECTION 12AA OF THE ACT. AGGRIEVED BY THE ORD ER OF THE CIT(E), THE ASSESSEE IS IN APPEAL BEFORE US. 3. THE LD. COUNSEL FOR THE ASSESSEE, SUBMITTED THAT ASSESSEE IS AN ANCIENT TEMPLE AND IS NOT A TRU ST CREATED UNDER A TRUST DEED. HE SUBMITTED THAT THE T EMPLE IS REGISTERED WITH THE ENDOWMENTS DEPARTMENT, GOVERNMENT OF A.P. AND THEREFORE, THE CERTIFICATE O F REGISTRATION HAS TO BE TAKEN INTO CONSIDERATION AS A VALID DOCUMENT EVIDENCING CREATION OF A TRUST. HE SUBMITT ED THAT THE CERTIFICATE ISSUED BY THE ENDOWMENTS DEPARTMENT WAS ENCLOSED ALONG WITH THE APPLICATION UNDER SECTION 10A BUT THE CIT(E) HAS SUMMARILY REJE CTED THE ASSESSEES APPLICATION WITHOUT PROPERLY APPRECI ATING THE LEGAL POSITION OF THE ASSESSEE. THE LD. COUNSEL FOR THE ASSESSEE ALSO RELIED UPON THE DECISION OF THE HONB LE 3 ITA.89/H/2016 SRI KODANDARAMASWAMY TEMPLE, TAMMINAPATNAM, CHILLAKUR (M), SPSR NELLORE. MADHYA PRADESH HIGH COURT IN THE CASE OF LAXMINARAY AN MAHARAJ & ANOTHER VS. CIT REPORTED IN (1989) 150 IT R 465 IN SUPPORT OF THIS CONTENTION. HE FURTHER SUBMITTED THAT THE REVENUE HAD FILED SLP BEFORE THE HONBLE SUPREM E COURT AGAINST THE ABOVE DECISION AND THE HONBLE SUPREME COURT DISMISSED THE SLP AS REPORTED IN 186 ITR (STATUTE) 32 (SC). THUS, ACCORDING TO HIM, THE CIT( E) HAS COMMITTED AN ERROR IN REJECTING THE ASSESSEES APPL ICATION FOR REGISTRATION UNDER SECTION 12AA OF THE I.T. ACT . 4. THE LD. D.R. ON THE OTHER HAND, SUPPORTED THE ORDERS OF CIT(E). 5. HAVING REGARD TO THE RIVAL CONTENTIONS AND THE MATERIAL ON RECORD, WE FIND THAT THE ASSESSEE TEMPL E IS REGISTERED WITH THE ENDOWMENTS DEPARTMENT UNDER SECTION 6(C)(II) OF THE A.P. CHARITABLE AND HINDU R ELIGIOUS INSTITUTIONS AND ENDOWMENTS ACT, 1987. SECTION 6 OF THE ACT PROVIDES FOR PREPARATION AND PUBLICATION OF LIS T OF CHARITABLE AND RELIGIOUS INSTITUTIONS AND ENDOWMENT S ON THE BASIS OF THE INCOME. CLAUSE-(C) AND SUB-CLAUSE (II) THEREOF, PROVIDES FOR RELIGIOUS INSTITUTIONS AND ENDOWMENTS OTHER THAN MUTTS NOT FALLING UNDER CLAUS E- (A) OR CLAUSE-(B) OF SECTION-6 OF THE ACT. THE RELI GIOUS INSTITUTIONS AND ENDOWMENTS ARE DEFINED UNDER SUB- SECTIONS 22 AND 23 OF SECTION-2 OF THE SAID ACT. FO R THE SAKE OF READY REFERENCE, THEY ARE REPRODUCED HEREUN DER : (22) 'RELIGIOUS ENDOWMENTS' MEANS PROPERTY (INCLUDING MOVABLE PROPERTY) AND RELIGIOUS 4 ITA.89/H/2016 SRI KODANDARAMASWAMY TEMPLE, TAMMINAPATNAM, CHILLAKUR (M), SPSR NELLORE. OFFERINGS WHETHER IN CASH OR KIND, GIVEN OR ENDOWED FOR THE SUPPORT OF A RELIGIOUS INSTITUTION OR GIVEN OR ENDOWED FOR THE PERFORMANCE OF ANY SERVICE OR CHARITY OF A PUBLIC NATURE CONNECTED THEREWITH OR OF ANY OTHER RELIGIOUS CHARITY ; AND INCLUDES THE INSTITUTION CONCERNED AND ALSO THE PREMISES THEREOF. EXPLANATION-1 :- ALL PROPERTY WHICH BELONGED TO OR WAS GIVEN OR ENDOWED FOR THE SUPPORT OF A RELIGIOUS INSTITUTION, OR WHICH WAS GIVEN OR ENDOWED FOR THE PERFORMANCE OF ANY SERVICE OR CHARITY OF A PUBLIC NATURE CONNECTED THEREWITH OR OF ANY OTHER RELIGIOUS CHARITY SHALL BE DEEMED TO BE A RELIGIOUS ENDOWMENT WITHIN THE MEANING OF THIS DEFINITION, NOTWITHSTANDING THAT, WHETHER BEFORE OR AFTER THE COMMENCEMENT OF THIS ACT, THE RELIGIOUS INSTITUTION HAS CEASED TO EXIST OR CEASED TO BE USED AS A PLACE OF RELIGIOUS WORSHIP OR INSTRUCTION OR THE SERVICE OR CHARITY HAS CEASED TO BE PERFORMED. EXPLANATION-II :- ANY INAM GRANTED TO AN ARCHAKA, SERVICE-HOLDER OR OTHER EMPLOYEE OF A RELIGIOUS INSTITUTION FOR THE PERFORMANCE OF 'ANY SERVICE OR CHARITY IN CONNECTION WITH A RELIGIOUS INSTITUTION SHALL NOT BE DEEMED TO BE A PERSONAL GIFT TO THE ARCHAKA, SERVICE-HOLDER OR EMPLOYEE, NOTWITHSTANDING THE GRANT OR RYOTWARI PATTA TO AN ARCHAKA, SERVICE HOLDER OR EMPLOYEE UNDER THE ANDHRA PRADESH (ANDHRA AREA) INAMS (ABOLITION AND CONVERSION INTO RYOTWARI) ACT, 1956 BUT SHALL BE DEEMED TO BE A RELIGIOUS ENDOWMENT ; (23) 'RELIGIOUS INSTITUTION' MEANS A MATH, TEMPLE OR SPECIFIC ENDOWMENT AND INCLUDES A BRINDAVAN, SAMADHI OR ANY OTHER INSTITUTION ESTABLISHED OR MAINTAINED FOR A RELIGIOUS PURPOSE ; 5.1. THE ABOVE DEFINITIONS CLEARLY DEMONSTRATE THA T SUCH RELIGIOUS INSTITUTIONS OR ENDOWMENTS ARE FOR T HE 5 ITA.89/H/2016 SRI KODANDARAMASWAMY TEMPLE, TAMMINAPATNAM, CHILLAKUR (M), SPSR NELLORE. PURPOSE OF ANY SERVICE OR CHARITY FOR THE PUBLIC. T HEREFORE, ANY INSTITUTION REGISTERED UNDER SECTION 6 OF THE A .P. CHARITABLE AND HINDU RELIGIOUS INSTITUTIONS AND ENDOWMENTS ACT IS DEEMED TO BE CARRYING ON THE CHARITABLE AND RELIGIOUS ACTIVITIES. THE CERTIFICAT E OF REGISTRATION THEREFORE, ESTABLISHES THAT THE TEMPL E IS A RELIGIOUS AND CHARITABLE INSTITUTION. THE HONBLE M ADHYA PRADESH HIGH COURT IN THE CASE OF LAXMINARAYAN MAHA RAJ & ANOTHER VS. CIT (CITED SUPRA) HAS HELD THAT WHEN A TRUST IS NOT CREATED UNDER AN INSTRUMENT I.E., THE DOCUMENT EVIDENCING THE CREATION OF THE TRUST, THE EVIDENTIAL DOCUMENT CANNOT BE LIMITED TO DOCUMENTS WHICH DIRECTLY PROVE THE CREATION OF THE TRUST AND THAT ALL DOCUMENTS WHICH AFFORD A LOGICAL BASIS OF INFERRING CREATION OF THE TRUST CAN BE DESCRIBED TO BE DOCUM ENTS EVIDENCING THE CREATION OF THE TRUST WITHIN THE ME ANING OF RULE 17A(A). IN THE CASE BEFORE US, SINCE THE CERTI FICATE OF REGISTRATION WITH ENDOWMENTS DEPARTMENT OF THE GOVERNMENT OF A.P. IS A DOCUMENT EVIDENCING THE CRE ATION OF THE TRUST, WE ARE OF THE OPINION THAT THE CIT(E) HAS ERRED IN REJECTING THE APPLICATION OF THE ASSESSEE FOR NON- FILING OF THE TRUST DEED. IN VIEW OF THE SAME, WE D EEM IT FIT AND PROPER TO SET ASIDE THE ORDER OF THE CIT(E) AND REMAND THE SAME TO HIS FILE FOR RE-CONSIDERATION OF THE ASSESSEES APPLICATION FOR REGISTRATION UNDER SECTI ON 12AA BY TAKING THE CERTIFICATE OF REGISTRATION WITH THE ENDOWMENTS DEPARTMENT AS EVIDENCE OF CREATION OF TR UST. 6 ITA.89/H/2016 SRI KODANDARAMASWAMY TEMPLE, TAMMINAPATNAM, CHILLAKUR (M), SPSR NELLORE. 6. IN THE RESULT, APPEAL OF THE ASSESSEE IS TREATE D AS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 17.06.2016. SD/- SD/- (S. RIFAUR RAHMAN) (SMT. P. MADHAVI DEVI) ACOUNTANT MEMBER JUDICIAL MEMBER HYDERABAD, DATED 17 TH JUNE, 2016 VBP/- COPY TO : 1. SRI KODANDARAMASWAMY TEMPLE, TAMMINAPATNAM, CHILLAKUR (M), SPSR NELLORE. C/O. MR. K. VASANT KUMAR & MR. A.V. RAGHURAM, ADVOCATES, 610, BABUKHAN ESTATE, BASHEERBAGH, HYDERABAD 001. 2. COMMISSIONER OF INCOME TAX (EXEMPTIONS), HYDERABAD. 3. THE INCOME TAX OFFICER (EXEMPTIONS) WARD, GUNTUR. 4. D.R. ITAT A BENCH, HYDERABAD. 5. GUARD FILE