PRO-LIFE CHARITABLE TRUST,IRINJALAKUDA V. COMMISSIONER OF INCOME TAX EXEMPTIONS, KOCHI

ITA 52/COCH/2024

AI Insights

The case involves the Pro-Life Charitable Trust appealing against the decision of the Commissioner of Income-tax (Exemption), Cochin, which denied the regularization of their provisional registration under section 12A of the Income Tax Act. The Commissioner had rejected the application based on the trust's activities of encouraging couples to have more children, which was deemed not to provide relief to the poor as required under section 2(15) of the Act. Additionally, the trust's activities were seen as a violation of section 13(1)(b) of the Act. The tribunal, considering the trust's willingness to amend the deed, allowed the appeal for statistical purposes and directed a fresh consideration post-amendment.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 23512 (ITAT-COCHIN)
• Duration Of Justice: 9 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-10-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2023-2024
• Appeal Filed On: 25-01-2024
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SANJIT KUMAR DAS
• Assessee Lawyers: P.J.ANIL KUMAR
• Keywords: Gift; Principle of natural justice; Charitable institution
• Section: 12AA; 12A

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH, COCHIN Before Shri Waseem Ahmed, Accountant Member & Shri Soundararajan K, Judicial Member ITA No.52/Coch/2024 : Asst.Year 2023-2024 M/s. Pro-Life Charitable Trust 20/195, Manavalassery Village Kodungallur Road Thrissur – 680 121 PAN : AAETP6520G. v. The Commissioner of Income- tax (Exemption) Kochi. (Appellant) (Respondent) Appellant by : Sri.P.J.Anil Kumar, Advocate Respondent by : Sri.Sanjit Kumar Das, CIT-DR Date of Hearing : 25.09.2024 Date of Pronouncement : 29.10.2024 O R D E R Per Bench : This is an appeal filed by the assessee challenging the order of the Commissioner of Income-tax (Exemption), Cochin, dated 29.11.2023, in which the provisional registration granted was not regularized. The relevant assessment year is 2023-2024. 2. The assessee is a charitable trust and they got provisional registration u/s.12A of the Act on 16.09.2022, and thereafter, they applied for regularization of the registration on 10.05.2023. The learned CIT(E) had not renewed the registration for the reason that as per the object clause and as per the activity, the assessee is encouraging couples to have ITA No.52/Coch/2024. Pro-Life Charitable Trust. 2 more children. Therefore, the ld.CIT(E) had observed that encouraging couples to have more children cannot be treated as relief to poor to qualify u/s.2(15) of the Act. The ld.CIT(E) also relied on the object clause that giving of gifts during baptism for having more children amounts to specific violation of sec.13(1)(b) of the Act. In view of the above said reasons, the ld.CIT(E) rejected the application. Challenging the above said order of the ld.CIT(E), the assessee is in appeal before us with the following grounds of appeal:- “1. The learned Commissioner of Income Tax (Exemption) was not justified in rejecting application u/s. 12AA of the Act and there by erred not only in law, but also in the facts and circumstances of the case. 2. The commissioner of Income Tax (Exemption) was driven by extraneous considerations while interpreting the provisions u/s. 13(1)(b) Of the Act. 3. The commissioner of Income Tax (Exemption) erred in law by rejecting the exemption claim u/s.11 of the Act without considering the detailed reply to show cause notice filed by the appellant on 09...11.2023. In doing so, the CIT (E) violated the Principles of Natural Justice. 4. The commissioner of Income Tax (Exemption) erred in law by rejecting the application filed u/s. 12A (1)(ac)(iii) of the act by considering one object of the trust, without appreciating the other objects in a cumulative manner to reach a conclusion about the activities of the trust. The finding of the CIT (E) that a particular object is not charitable and that too by referring to Sec. 2(15) without considering the particular object of the clause is against the settled judicial precedents laid down by the jurisdictional high court and also the Apex Court. 5. The commissioner of Income Tax (Exemption) ought not have reject the application filed u/s. 12A (1)(ac)(iii) of the act by stating that the appellant has violated section 13(1)(b) of the Act without considering the real facts of the appellant's application of Income. ITA No.52/Coch/2024. Pro-Life Charitable Trust. 3 6. The commissioner of Income Tax (Exemption) failed to consider the fact that the appellant is a Public Trust Registered under The Indian Trusts Acts-1882 is in existence from 2021 vide document number 22/IV/2021 dated 24 February 2021 with SRO Irinjalakuda. Considering the nature of our trust which had large number of objects for benefit of general public rejection of exemption u/s.11 is against the provisions of law. 7. Such other grounds as may be raised at the time of hearing the appeal.” 3. At the time of hearing, the ld.AR appearing for the assessee-trust, submitted that the above said clause would not be a reason for rejecting the application and if at all this Tribunal deems it as an objectionable clause, he undertook to amend the deed by deleting the disputed object and prayed to allow the appeal. 4. The learned Departmental Representative relied on the order of the CIT(E) and prayed to dismiss the appeal. 5. We have heard the arguments of both sides and perused the material available on record. We have also perused the object clauses of the trust, which were relied on by the ld.CIT(E) for denying the exemption and we are also of the view that to avail the benefit as a charitable trust, it may also be a hindrance to the authorities to consider this application on merits. Without going to the issue on merits, we hereby record the submissions made by the ld.AR to the effect that the trust would delete the disputed object and would file an amended deed before the ld.CIT(E). Accordingly, we are inclined to grant one more opportunity to the assessee-trust for making necessary corrections in the trust deed by ITA No.52/Coch/2024. Pro-Life Charitable Trust. 4 removing the disputed objects pointed out by the ld.CIT(E) and apply afresh to the ld.CIT(E) for granting necessary registration u/s.12A of the Act. We also direct the ld CIT(E), to consider the application on merits, in the event the trust files the amended deed by deleting the disputed objects. We also made it clear that thereafter the ld CIT would decide the issue in accordance with law after allowing reasonable opportunity of hearing to the assessee. 6. In the result, the appeal filed by the assessee is allowed for statistical purposes. Order pronounced on this 29th day of October, 2024. Sd/- (Waseem Ahmed) Sd/- (Soundararajan K) ACCOUNTANT MEMBER JUDICIAL MEMBER Cochin ; Dated : 29th October, 2024. Devadas G* Copy to : 1. The Appellant. 2. The Respondent. 3. The CIT Concerned. 4. The DR, ITAT, Cochin. 5. Guard File. Asst.Registrar/ITAT, Cochin "