The Commissioner of Income Tax (Exemptions), Hyderabad V. Hyderabad Cricket Association

ITTA/349/2018

AI Insights

The case involves an appeal by the Commissioner of Income Tax (Exemptions), Hyderabad against the Hyderabad Cricket Association concerning the registration under Section 12A of the Income Tax Act, 1961. The primary contention was whether the Tribunal's decision to grant registration and not sustain the cancellation of registration was perverse or contrary to law. The Tribunal had previously decided in favor of the assessee, relying on judicial precedents from the Madras High Court and other jurisdictions. The High Court of Telangana upheld the Tribunal's decision, citing the absence of substantial questions of law and the adherence to established judicial precedents.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 692265 (HC-TELANGANA)
• Appeal Type: Others
• Pronouncement Date: 12-10-2023
• Assessment Year: misc
• Other Referred Cases: Tamil Nadu Cricket Association Vs. DIT, Commissioner of Income Tax Vs. Andhra Chamber of Commerce, DIT (E) Vs. Khar Gymkhana
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: C P RAMASWAMI
• Assessee Lawyers: A RADHA KRISHNA
• Keywords: Charitable Trust; Exemptions; Income Tax; Registration; Perversity of Tribunal's Decision
• Section: 12A; 12AA(3); 2604

Judgement Text

"[ 3386 J IN THE HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD THURSDAY, THE TWELFTH DAY OF OCTOBER TWO THOUSAND AND TWENTY THREE PRESENT THE HON'BLE SRI JUSTICE P. SAM KOSHY AND THE HON'BLE SRI JUSTICE LAXMI NARAYANA ALISHETTY INCOME TAX TRIBUNAL APPEAL No: 34 ol 2018 I lncome Tax Tribunal Appeal Under Section 2604 of the lncome Tax Act, 1961 against the order of the lncome Tax Appellate Tribunal, Hyderabad Bench'B', Hyderabad in ITA No.649/Hyd/2015 dated 13-10-2016 preferred against the Order of the Commrssioner of lncome Tax (Exemptions), Hyderabad, F.No.CIT(E/Hyd/ HCN 12AA(3)l 1 4-1 5/1 94 dated 1 3-03-201 5. Between: The Commissioner of lncome{ax (Exemptions), Hyderabad. ...Appellant AND M/s.Hyderabad Cricket Association, Rajiv Gandhi lnternational Cricket Stadium, Visaka Cricket Ground, Plot Nos. 1 to 5, Tarnaka-Uppal Road, Hyderabad - 500 039. ...Respondent Counsel for the Appellant: SRI A RADHA KRISHNA representing SRI J.V. PRASAD, Sr. SC FOR lT DEPARTMENT Counsel forthe Respondent: SRI C.P. RAMASWAMI The Court delivered the following: JUDGMENT l i I : i i I : I l ! I i THE HON'BLE SRI JUSTICE P. SAM KOSHY AND THE HON'BLE SRI JUSTICE LAXMI NARAYANA ALISHETTY I.T.T.A.No.349 of 2O18 JUDGMENT: (p,.'r t tot'lle s,, li:/r(.' P.SAM KosHY) Heard Sri A. Radl'r:r I(rishna, lc:rrned counsel for the appellant and Sri C.P. Ramass'ami, learned counsel for the respondent. Perr-rsed thc recorcl. 2. This appeal has been [ilccl assailing the order dated 13.1O.2016 passed in I.T.A.No.6 t!)/H,r'cl/2015 on the file of the learnecl Income Tax Appellate 'lribunal, ilvderab:Ld Bench 'B', Hyderabad (hereinafter relerred to as 'the Tribunal'). 3. Vide the impugned order, the appea.l stands decided in favour of the assessee. 1. Learned counsel for Lhe appellant has contended that the hnding of the Tribunal to be perverse so far as holding that the assessee was entitled for registration under Section 12A of the Income Tax Act, 1961 (hereinafter referred to as 'the Act') so also it is the contention of the learnecl counsel that the finding of the Tribunal so far as not sustaining the order of cancellation of registration under Section 12AA(3) of the Act being contrary to 1aw. Even then the Tribunal itsell has accepted the fact that the ) P(k.l .! t . .J LT l A.No :l +9 ol 2()18 assessee has cleviated from the main objects by r'r'av of conducting rvomen's cricket event Lastll', it was contended that sincetheaSSesscehasmiserablyfailedinproducingtheprimary evidence like the bills and vouchers so as to get the eligibility under Section L 1 of the Act, the finding of the Tribunal to be bad to the afbrcsaid extetlt. 5. Upon due perr-rsal of the rccords, more particularly' the impugned orcler itself rvoulci clcarly reflect that the Tribunal in the course of clccicling the matter found that all the contentions whichrr.ereraiserlbythelearnedcounselfortherevenuehad been dealt rvith extensivelv by a recent decision of the Madras High Court in the case of Tamil Nadu Cricket Association Vs' DI?^ @) qnd Othersl, u'herein, all the contentions that the appeilant has raised herein had been extensively dealt with and the said judgment of the Division Bench of the Madras High Court still holds good. Further, rvhat is also reflected is that in factthedecisionoftheMadrasHighCourtwaspassedrelying upon the decision of the Hon'ble Supreme Court in the iase of Comrnissiotter of Income Tax Vs' Andhra Chamber oJ Cofiinterce2, which is subsequently been followed in various other decisions also. ln addition to relying upon the said ' 1zo r+; :oo trr< rr:: 'z ( 1965) 55 trR 722(sc) t5k.-r & L . .-r l.'f.'l.A.l{o.3+9 of 2018 registration is concerned, the Tribunal further relied upon the decision of the Hon'ble Bombav l{igh Court in thc case of DIT (E) Vs. Khar Ggmkhana decided or.r 06.06.2O16 in I.T.A.No.2349 of 20 13, 6. Given the aforesaid facts ri,hat is apparently evident is that the decision under challenge in the prcsent appeal is one which has been passed purely on the basis of a series of judicial precedents of the same nature rendered by more than one High Court. Recently again, the High Court of Andhra Pradesh, Amaravati in LT.T.A.No.lll of 2Ol7 decided on 15.O9.2022 has had the occasion of dealing q,ith the similar issue and in the course of deciding the said matter, the Hon'ble High Court of Andhra Pradesh in paragraph Nos.8, 9, 12 and 13 has held as under: \"8. In order to apply Section I2,,1.4.(3), there must be a specihc lLnding by tl.e Commissioner ro thc cffcct that the activities oI the Trust or Insfifudon are noL genuine and are not being carried out in accordance with the objccts of the Trust- But, as statcd earlier, C.l.T., clearly gave a Iinding that the Assessee is carrying on its activitics in accordance uith rhe objects. There is no finding by C.l.T-, that the activi[ics oi Lhe Assessee Trust a.e not genuine. Hcnce, on facls Lhere is no dispute that the activities of the Assessee Trusr are genuine and that the Assessee Trust is carrying on its activitics in accordancc with its objects. Therefore, the finding of the C.I-T., that the provisions of Section 12AA(3) need to be construed in a holistic manner, rvith a view to givc ellect to the object whlch the Iegislation intends ro achieve ancl to dcrecognize thc objects of the Assessee, on the ground that they arc not charitable under circumstances prescribed under Section 2(15), in not a correct proposition of law. decision so far as the justihcation lbr canceliation of the 1 P [ r.t i. A J i l 'l'.A.No.3lg ot 20 La 9. In fact, Lhe materlai oD rccord. as obscrved callier. and t the judgments d.llvcrcd ioda ', rt has i)ccn catcqorjcally hcld Lhat thc activities oI thc Trust arc gclrulnc and the Asscsscc's Tr-ust hils car.iccl out its a.lrvilics rn accordance rith its objccts. Hcnce, u,e acccpt thc contcntiorls of rhe Assessee, namcl)', that thc vcry invocation o[ ihc powcr oi cancellation rs bad in larv. l2- Thc rlc t rssuc. r,.ir:ih ftrlls for consrdcralion is, u,hcthcr the rcgistraLlon can bc canccllcd on the glound that Lhe actlvrtlcs of thc Ass.ssec aLlract ih. Provrso to Sectron 2(l5l oI the Acr? 13. As scen lrom Ihc findings givcn, the Assessee rs not opcrating '.rirh proht molivc and that its activitics are not rn thc naturc oI business. When oncc it is lound that the activltics of the Trusl a[c charitab]e rn naturc, rlhich was recognDed by CIT at the timc of grantrrll rcgistration, and in vierv of the larv laid dorvn by thc various Hrgh Court in GSI IndJa V, DIT3; Dlstrict Crlcket Associdtlofl v- DITIE), New Delhia; ICAI V. DGIT lExemptlon)s; Buredu ol Indla stdad.o.rds v. Dlrectot Genetdl of Income Ia-x (Exetuptlonsf; Instltute oJ Cha.rtered Account@nLt ol India V. DGIT @l?; M/s. G.5.1 Indla V- Directot General oJ l^come Tdx (Exemptlonl d.nd. A^othef; cotun ssloler oJf Sales Td-x V. Sai Publlco.tlon Funde; and Additto^dl Commlss{oner oJ Income Tax V. Surd.t Art Silk Cloth Md^utacturers Association,o; it has to bc hcld that Lhc acLr!Lr.s arc chantablc in nalure onlf'. 7. In the aforesaid facts and circumstarces of the case and the judicial preccdcnts on the issue raised by the appellant, we are of the considered opinion that the Tribunal has not committed any error or perversity in reaching to the said conclusion and deciding the matter in favour of the assessee. We do not also Iind any substantial question of law made out. 8. The appeal thus fails and is accordingly dismissed. There shall be no order as to costs. '160 IIR l3E ' tIA No. 3095tr)€U2012, darcd li 01.2015 '147 IIR 99 (Del) 6 (2013) 212 Taxman 2010 (Dclhr) 'w.P.(c).314720 t2, dr: 04 07.20 ll 3 (2011) 2 t9 Taxman 205 '(2002) 2s8 trR 70 (sc) '' (1980) l2r rrR I (sc) l, .r & i_N ..] I 'l'.'l' A No J t9 of 20tg Miscellaneous applications pending, if an.y, sha]l stald To, closed Sd/- B.S. CHIRANJEEVI JOINT REGISTRAR //TRUE COPY// SECTION OFFICER 1. The Income Tax Appellate Tribunal, Hyderabad Bench ,8,, Hyderabad 2. The Commissioner of lncome Tax (Exemptions), Hyderabad. 3. One CC to SRI J.V. PRASAD, Sr. SC FOR tT DEPARTI 4ENT IOPUCI 4. One CC to SRI C.P. RA[/ASWA[/|, Advocate [OpUC] 5. Two CD Copies kam HIGH COURT DATED:1 211012023 JUDGMENT ITTA.No.349 of 2018 THE APPEAL IS DISMISSED ( 1tl9 5T,416: 1 7 N[ i 2ir2: L) t', 7 o ,*! A * o i;I)AT ,:'.rr*1) -;;2 l) h 7.D "