Abhinayavani Nritya Niketan , Hyderabad V. Commissioner of Income Tax, (Exemptions), Hyderabad

ITA 994/Hyd/2019

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 3467 (ITAT-HYDERABAD)
• Duration Of Justice: 5 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-11-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB-A
• Next Hearing Date: 21-10-2019
• Assessment Year: misc
• Appeal Filed On: 13-06-2019
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: Y V S T SAI
• Assessee Lawyers: C S SUBRAHMANYAM; V SIVA KUMAR A RS
• Keywords: Charitable institution; Set aside
• Section: 80G; 12A

Judgement Text

ITA NOS. 994 & 995/HYD/2019 (ABHINAYAVANI NIRTYA NIKETAN) IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH A', HYDERABAD BEFORE SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER AND SHRI V. DURGA RAO, JUDICIAL MEMBER ITA NOS. 994 & 995 /HYD/201 9 ABHINAYAVANI NRITYA NIKETAN FLAT NO.202, 7 - 1 - 45 VENKATESHWARA TOWERS DHARAM KARAM ROAD AMEERPET BEGUMPET HYDERABAD PAN AA GTA3643M VS. CIT(EXEMPTIONS) HYDERABAD . APPELLANT RESPONDENT ASSESSE BY : SH. C.S.SUBRAHMANYAM & SHRI V.SIVA KUMAR - ARS REVENUE BY : SHRI Y.V.S.T.SAI, CIT, D.R. DATE OF HEARING : 21/10/19 DATE OF PR ONOUNCEMENT : 28 /11/19 O R D E R PER V. DURGA RAO, J.M. THESE APPEALS BY THE ASSESSEE ARE DIRECTED AGAINST THE SEPARATE ORDERS OF CIT(E), HYDERABAD, BOTH DATED 30/04/2019, WHEREBY APPLICATIONS FOR REGISTRATION U/S 12A AND APPROVAL U/S 80G HAVE B EEN REJECTED. ITA NOS. 994 & 995/HYD/2019 (ABHINAYAVANI NIRTYA NIKETAN) 2 2. FACTS OF THE CASE, IN BRIEF, ARE THAT ASSESSEE IS A TRUST NAMED AS ABHINAYAVANI NRITYA NIKETAN ESTABLISHED FOR CHARITABLE PURPOSE. THE TRUST DEED WAS EXECUTED ON 15/12/2017 WHICH WAS REGISTERED AS DOCUMENT NO.125/2017 WITH SRO, S.R. NAGAR, HYDERABAD. THE MAIN OBJECTS OF THE TRUST ENUMERATED IN THE TRUST DEED ARE AS UNDER: - TO P ROMOTE THE ART OF INDIAN CLASSICAL DANCE ESPECIALLY THE 'KUCHIPUDI' STYLE OF DANCING IN INDIA BY ENCOURAGING AND EDUCATING ASPIRANTS IN LEARNING THE ART OF DANCE THE NUANCES OF BHARATA SASTRA, CONDUCTING DANCE PROGRAMS, PUBLISHING LITERATURE ON DANCE, PROD UCTION OF AUDIO AND VISUAL MATERIAL ON DANCE, SPONSORING FOR DANCE FESTIVALS AND PROGRAMS, OPERATING DANCING SCHOOLS AND CONDUCTING CERTIFICATE COURSES ON DANCE. TO PROMOTE THE ART OF CLASSICAL MUSIC OF CARNATIC OR HINDUSTANI STYLES EITHER VOCAL OR INS TRUMENTS SUCH AS VEENA, VIOLIN ETC. BY ENCOURAGING AND EDUCATING ASPIRANTS IN LEARNING THE ART OF MUSIC, CONDUCTING MUSIC PROGRAMMES, PUBLISHING LITERATURE ON MUSIC, PRODUCTION OF AUDIO AND VISUAL MATERIAL ON MUSIC, SPONSORING FOR MUSIC FESTIVALS AND PROGR AMMES, OPERATING MUSIC SCHOOLS AND CONDUCTING CERTIFICATE COURSES ON MUSIC. TO PROMOTE THE EDUCATIVE VALUES OF ONE OF HINDU SCRIPTURE BHARATA SASTRA THROUGH DANCE TRAINING. THE ASSESSEE - TRUST WITH THE ABOVE OBJECTS, FILED AN APPLICATION I N FORM NO. 10A FOR SEEKING REGISTRATION U/SEC . 12A BEFORE THE ID.CIT(E) ALONG WITH ALL THE DETAILS. THE ID.CIT(E) AFTER EXAMINING THE DETAILS FILED BY THE ASSESSEE OBSERVED THAT THE TOTAL STUDENTS ADMITTED IN THE ASSESSEE - TRUST ARE 42 STUDENTS, OUT OF WHICH 8 ARE TRAINED WITHOUT ANY FEE, 19 STUDENTS ARE CHARGES @ 2,000/ - P.M., 7 STUDENTS ARE CHARGED @ RS. 1,500/ - P.M. AND 8 ITA NOS. 994 & 995/HYD/2019 (ABHINAYAVANI NIRTYA NIKETAN) 3 STUDENTS ARE CHARGED @ 1,200/ - P.M. THEREFORE, THERE IS NO CHARITABLE ACTIVITY IN CONDUCTING DANCE COURSES BY COLLECTING FEES AND ACCORDINGLY 12A REGISTRATION WAS DENIED. ACCORDING TO THE LD.CIT(E), THE ASSESSEE IS RUNNING DANCE CLASSES, WHICH IS PURELY COMMERCIAL IN NATURE, THEREFORE HE DENIED 80G APPROVAL ALSO. 3 . ON APPEAL BEFORE US, LD. COUNSEL FOR THE ASSESSEE HAS SUBMITTED THAT THE ASSESSEE - TRUST I.E. ABHINAYAVANI NRITYA NIKETAN IS INVOLVED IN TEACHING AND PROMOTING NUANCES OF CLASSICAL INDIAN FORM OF DANCE KUCHIPUDI. THE INSTITUTION HAS TWO PART TIME LECTURERS, APART FROM SMT. C. BALA TRIPURA SUNDARI SETTLER OF THE TRUST. THE PUPILS WHO LEARN DANCE ARE MALE AND FEMALE STUDENTS DRAWN FROM AGES 8 TO 45 YEARS. THE TRUST DOES NOT BAR ANY STUDENT FR OM LEARNING DANCE BY SPECIFYING CRITERIA FOR CASTE, CREED OR RELIGION. THE CURRICULUM OF BASIC DANCE LEARNING IS FOUR STAGES AND THE ADVANCED LEVEL IS SEVEN STAGES. AS THE STUDENT PROGRESS THE COMPLEXITIES OF EACH LEVEL, SHE/HE IS PROMOTED TO THE NEXT LEV EL. LD. COUNSEL FOR THE ASSESSEE HAS SUBMITTED THAT LEARNING OF DANCE I.E. KUCHIPUDI IS AN EDUCATION AND THEREFORE ASSESSEE IS RUNNING DANCE SCHOOL WITHOUT ANY PROFIT MOTIVE. WHATEVER FEE COLLECTED FROM SOME OF THE STUDENTS IS ONLY TO RUN THE INSTITUTE AND NOT FOR MAKING PROFIT, THEREFORE ASSESSEE MAY BE GRANTED 12A REGISTRATION. ITA NOS. 994 & 995/HYD/2019 (ABHINAYAVANI NIRTYA NIKETAN) 4 4. ON THE OTHER HAND, LD.DR HAS RELIED ON THE ORDER OF THE LD.CIT(E). 5. WE HAVE HEARD BOTH THE SIDES, PERUSED THE MATERIAL AVAILABLE ON RECORD AND ORDERS OF THE AUTHORITIES BEL OW. 6 . THE ASSESSEE - ABHINAYAVANI NRITYA NIKETAN IS A TRUST INVOLVED IN TEACHING AND PROMOTING CLASSICAL DANCE KUCHIPUDI . THE TRUST WAS ESTABLISHED WAY BACK ON 15/12/2017 WITH AN INTENTION TO PROMOTE THE ART OF INDIAN CLASSICAL DANCE , ESPECIALLY 'KUCHIPUDI' STYLE OF DANCING IN INDIA BY ENCOURAGING AND EDUCATING ASPIRANTS IN LEARNING THE ART OF DANCE THE NUANCES OF BHARATA SASTRA, CONDUCTING DANCE PROGRAMS, PUBLISHING LITERATURE ON DANCE, PRODUCTION OF AUDIO AND VISUAL MATERIAL ON DANCE, SPONSORING FOR DANCE FESTIVALS AND PROGRAMS, OPERATING DANCING SCHOOLS AND CONDUCTING CERTIFICATE COURSES ON DANCE . THAT APART, THE ASSES SEE IS CARRYING ACTIVITY OF CLASSICAL MUSIC OF CARNATIC OR HINDUSTANI STYLES EITHER VOCAL OR INSTRUMENTS SUCH AS VEENA, VIOLIN ETC. BY ENCOURAGING AND EDUCATING ASPIRANTS IN LEARNING THE ART OF MUSIC, CONDUCTING MUSIC PROGRAMMES, PUBLISHING LITERATURE ON M USIC, PRODUCTION OF AUDIO AND VISUAL MATERIAL AND TO PROMOTE THE EDUCATIVE VALUES OF ONE OF HINDU SCRIPTURE BHARATA SASTRA THROUGH DANCE TRAINING. 7 . FROM THE ABOVE, IT IS VERY CLEAR THAT LEARNING OF DANCE PARTICULARLY KUCHIPUDI IS CARRYING A SYSTEMIC EDUCATION AND ITA NOS. 994 & 995/HYD/2019 (ABHINAYAVANI NIRTYA NIKETAN) 5 THEREFORE THERE IS NO DOUBT ASSESSEE IS CARRYING EDUCATIONAL ACTIVITIES BY RUNNING KUCHIPUDI DANCE SCHOOL AND PROMOTING OTHER CLASSICAL MUSIC OF CARNATIC OR HINDUSTANI STYLES EITHER VOCAL OR INSTRUMENTS SUCH AS VEENA, VIOLIN ETC. THE LD.C IT(E) HAS NOT COMMENTED UPON ANYTHING FOR RUNNING THE EDUCATIONAL INSTITUTION BY THE ASSESSEE. THE ONLY OBJECTION RAISED BY THE LD.CIT(E) IS THAT THE ASSESSEE IS HAVING 42 STUDENTS, OUT OF WHICH ONLY 8 STUDENTS ARE ADMITTED WITHOUT FEE AND FROM REMAINING STUDENTS ASSESSEE TRUST COLLECTED FEE. ACCORDING TO THE LD. CIT(E), IT IS NOT PERFORMING CHARITABLE ACTIVITIES. WE FIND THAT THE FINDING GIVEN BY THE LD.CIT(E) IS NOT CORRECT FOR THE REASON THAT TO RUN THE EDUCATIONAL INSTITUTION PARTICULARLY KUCHIPUDI DANCE, SOME FUNDS ARE REQUIRED, FOR THAT ASSESSEE HAS COLLECTED NOMINAL FEE WHICH IS NOT SUFFICIENT TO RUN THE ORGANIZATION. OUT OF 42 STUDENTS, 8 STUDENTS WERE TAKEN WITHOUT COLLECTING FEE FROM THEM, WHATEVER NOMINAL FEE PAID BY OTHERS IS UTILIZED FOR T HE PURPOSE OF MAINTENANCE OF THE INSTITUTION. THEREFORE, WE FIND THAT NO COMMERCIAL ACTIVITY IS INVOLVED IN THE INSTITUTE BY COLLECTING NOMINAL FEE FROM THE REMAINING STUDENTS. 8 . THE ITAT, CHENNAI BENCH IN THE CASE OF VEMPATI CHINNA SATYAM KUCHIPUDI ART FOUNDATION VS. DCIT [(2013) 20 TAXMANN.COM 323 (CHENNAI)] WHEREIN THE TRIBUNAL HAS CONSIDERED ITA NOS. 994 & 995/HYD/2019 (ABHINAYAVANI NIRTYA NIKETAN) 6 THE ENTITLEMENT OF BENEFIT U/SEC. 10(23C)(IIIAD) TO THE ASSESSEE BY OBSERVING THAT ASSESSEE - TRUST IS AN INSTITUTION BY ITSELF OR NOT, WE HAVE TO EXAMINE THE SURROUNDING FACTS AND CIRCUMSTANCES IN WHICH THE ACTIVITIES OF THE ASSESSEE - TRUST ARE BEING CARRIED OUT. THE ASSESSEE IS ENGAGED IN PROMOTING AND GIVING TRAINING IN TRADITIONAL ART FORMS LIKE KUCHIPUDI DANCE. IT IS KNOWN TO EVERYBODY THAT EXCEP T IN CERTAIN COLLEGES OF FINE ARTS AND PERFORMING ARTS, THESE TYPES OF TRADITIONAL ART FORMS ARE IMPARTED IN 'GURUKULA SYSTEM'. IF WE SEE AROUND THE WORLD, WHAT IS THE GROUND REALITY? TRAINING AND EDUCATION IN PERFORMING ARTS LIKE DANCE AND MUSIC ARE TRADI TIONALLY GIVEN BY TEACHERS TO SMALL GROUPS OF STUDENTS IN AN INFORMAL ATMOSPHERE. TRAINING IN THE ABOVE FIELD IS USUALLY NOT GIVEN IN SCHOOLS, COLLEGES AND INSTITUTIONS HAVING A FORMAL FRAME. THEREFORE THE ATTIRE AND CHOREOGRAPHY OF THE PLACE OF INSTRUCTIO N IS NOT THE PRIME THING TO BE LOOKED INTO BY THE ASSESSING AUTHORITY. DESPITE THE FORM OR THE ABSENCE OF FORM, WHAT IS TO BE LOOKED INTO IS WHETHER THE ASSESSEE - TRUST IS IN FACT IMPARTING TRAINING IN PERFORMING ARTS LIKE VARIOUS DANCE FORMS INCL UDING TRADITIONAL KUCHIPUDI AND GRANTED BENEFIT U/SEC. 10(23C)(IIIAD) OF THE ACT. DURING THE COURSE OF HEARING, LD.COUNSEL FOR THE ASSESSEE HAS SUBMITTED THAT VEMPATI CHINNA SATYAM KUCHIPUDI ART FOUNDATION HAS ALREADY ENJOYING 12A REGISTRATION. KEEPING IN VIEW OF THE ITA NOS. 994 & 995/HYD/2019 (ABHINAYAVANI NIRTYA NIKETAN) 7 FACTS AND CIRCUMSTANCES OF THE CASE AND ALSO BY CONSIDERING THE ABOVE DECISION OF THE ITAT, CHENNAI BENCH, WE FIND THAT THE ASSESSEE IS ENTITLED FOR REGISTRATION U/SEC, 12A OF THE ACT. 9. THE HON'BLE CALCUTTA HIGH COURT IN THE CASE OF CIT VS. DOON FOUNDATION [(1985) 154 ITR 208] WHEREIN IT WAS H ELD THAT 'EDUCATIONAL INSTITUTIONS NEED NOT BE AFFILIATED TO UNIVERSITIES OR BOARDS AND WHAT IS TO BE SEEN IS THAT THE OBJECT CLAUSE OF THE TRUST IS FOR EDUCATIONAL PURPOSES AND IT HAS CARRIED OUT A FULL - FLEDGED TEACHING OF THE RELEVANT COURSE'. 10. THE HON'BLE KARNATAKA HIGH COURT IN THE CASE OF CIT VS. ACADEMY OF GENERAL EDUCATION [(1084) 150 ITR 135 (KAR.)] WHEREIN IT WAS HELD THAT 'AN ASSESSEE NEED NOT NECESSARILY BE A SCHOOL OR A COLLEGE WHERE EDUCATION IS IMPARTED SO AS TO CLAIM EXEMPTION UNDER SECTION 10(22). THE COURT HELD THAT IT WOULD BE SUFFICIENT IF THE ASSESSEE IS AN EDUCATIONAL INSTITUTION PRIMARILY ENGAGED IN EDUCATIONAL ACTIVITIES'. 11. THE HON'BLE MADRAS HIGH COURT IN THE CASE OF CIT VS. KSHATRIYA GIRLS SCHOOLS MANAGING BOARD [(200 0) 245 ITR 170 (MAD.)] HAS HELD THAT 'THE TERM 'INSTITUTION' IS NOT USED IN A NARROW SENSE AND IT IS OF WIDE IMPORT'. 12. THUS, KEEPING IN VIEW OF THE FACTS AND CIRCUMSTANCES OF THE CASE AND ALSO BY FOLLOWING THE JUDGMENTS OF VARIOUS HIGH COURTS, ITA NOS. 994 & 995/HYD/2019 (ABHINAYAVANI NIRTYA NIKETAN) 8 WE ARE OF THE OPINION THAT THE ASSESSEE IS ENTITLED FOR REGISTRATION U/SEC, 12A OF THE ACT. ACCORDINGLY, REGISTRATION U/SEC, 12A IS GRANTED. THUS, THIS APPEAL FILED BY THE ASSESSEE IS ALLOWED. 13. SO FAR AS ITA NO. 9 94/VIZ/2019 IS CONCERNED, IT IS WITH RESPECT TO GRANT OF APPROVAL U/SEC, SOG. AS WE HAVE ALREADY GRANTED 12A REGISTRATION TO THE ASSESSEE, THUS THE ORDER OF THE ID.CIT(E) IS SET ASIDE AND DIRECT THE ASSESSEE TO FILE A FRESH APPLICATION BEFORE THE ID.CIT(E) . IF FRESH APPLICATION FOR GRANT OF SOG APPROVAL IS FILED BY THE ASSESSEE, THE ID.CIT(E) HAS TO CONSIDER THE SAME KEEPING IN VIEW OF OUR DECISION IN ASSESSEE'S APPEAL (SUPRA). THUS, THIS APPEAL IS ALLOWED FOR STATISTICAL PURPOSE. 14. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IN ITA NO.995/HYD/2019 IS ALLOWED AND THAT OF ITA NO.994/HYD/2019 IS ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN OPEN COURT ON 28 TH NOV., 2019. SD/ - SD/ - (A. MOHAN ALANKAMONY) ( V. DURGA RAO ) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 28 TH NOVEMBER, 2019 VR/ - ITA NOS. 994 & 995/HYD/2019 (ABHINAYAVANI NIRTYA NIKETAN) 9 COPY TO: 1. THE ASSESSEE ABHINAYAVANI NRITYA NIKETAN, FLAT NO. 202, 7 - 1 - 45, VENKATESHWARA TOWERS, DHARAM KARAM ROAD, AMEERPET, BEGUMPET, HYDERABAD. 2. THE REVENUE - CIT (EXEMPTIONS), HYDERABAD. 3. THE D.R., HYDERABAD. 4. GUARD FILE. ITA NOS. 994 & 995/HYD/2019 (ABHINAYAVANI NIRTYA NIKETAN) 10 DATE INITIAL ORIGINAL DICTATION PAD IS ENCLOSED IN THE FILE 1. DRAFT DICTATED ON 20/11/2019 SR.PS 2. DRAFT PLACED BEFORE AUTHOR 21/11/2019 SR.PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS 26 /11/2019 SR.PS 6. DATE OF PRONOUNCEMENT 28 /11/2019 SR.PS 7. FILE SENT TO THE BENCH CLERK SR.PS 8. DATE ON WHICH FILE GOES TO THE HEAD CLERK 9. DATE ON WHICH FILE GOES TO THE SR. PRIVATE SECRETARY 10. DATE OF DISPATCH OF ORDER