Sri Shirdimaduram Saibaba Charitable Trust, Perambalur v. CIT, Trichy

ITA 1947/CHNY/2009 | misc
Pronouncement Date: 09-07-2010 | Result: Allowed

Appeal Details

RSA Number 194721714 RSA 2009
Assessee PAN AAITS3315G
Bench Chennai
Appeal Number ITA 1947/CHNY/2009
Duration Of Justice 6 month(s) 10 day(s)
Appellant Sri Shirdimaduram Saibaba Charitable Trust, Perambalur
Respondent CIT, Trichy
Appeal Type Income Tax Appeal
Pronouncement Date 09-07-2010
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted C
Tribunal Order Date 09-07-2010
Date Of Final Hearing 01-07-2010
Next Hearing Date 01-07-2010
Assessment Year misc
Appeal Filed On 29-12-2009
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL BENCH C CHENNAI (BEFORE SHRI P. P. PARIKH VICE PRESIDENT AND SHRI GEORGE MATHAN JUDICIAL MEMBER) .. I.T.A. NO. 1946 & 1947/MDS/2009 ASSESSMENT YEAR : - SRI SHIRDIMADURAM SAIBABA CHARITABLE TRUST ANUPRIYA ILLAM 637/E-1 CAUVERY NAGAR PERAMBALUR-621212. PAN : AAITS 3315 G (APPELLANT) V. THE ASST. COMMISSIONER OF INCOME- TAX COMPANY CIRCLE-II TRICHY. (RESPONDENT) APPELLANT BY : SHRI R. VENKATESH RESPONDENT BY : SHRI B. SRINIVAS O R D E R PER GEORGE MATHAN JUDICIAL MEMBER : I.T.A. NO. 1946/MDS/09 IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF T HE LEARNED CIT-I TRICHY IN ORDER IN C.NO. 6162E(A)/CIT-I/TRY/2009-10 DATED 28-1 0-2009 REFUSING TO GRANT THE ASSESSEE REGISTRATION UNDER SECTION 80G OF THE INCOME-TAX ACT 1961. I.T.A. NO. 1947/MDS/09 IS AN APPEAL FILED BY THE AS SESSEE AGAINST THE ORDER OF THE LEARNED CIT-I TRICHY IN ORDER IN C.NO. 6162E(4) /CIT-I/TRY/2009-10 DATED 29.10.2009 REFUSING TO GRANT THE ASSESSEE REGISTRAT ION UNDER SECTION 12AA OF THE ACT. ITA NOS. 1946 & 1947/MDS/09 2 2. SHRI R. VENKATESH CHARTERED ACCOUNTANT REPRESEN TED ON BEHALF OF THE ASSESSEE AND SHRI B.SRINIVAS LEARNED DEPARTMENTAL REPRESENTATIVE REPRESENTED ON BEHALF OF THE REVENUE. 3. IT WAS SUBMITTED BY THE LEARNED AUTHORIZED REPRE SENTATIVE THAT THE ASSESSEE HAD APPLIED FOR REGISTRATION U/S. 12AA AND 80G OF THE ACT IN THE REQUISITE FORM NO.10A AND FORM NO. 10G ON 15-04-200 9. IT WAS THE SUBMISSION THAT THE TRUST WAS CREATED BY A DOCUMENT DATED 21-0 4-2008. IT WAS FURTHER SUBMITTED THAT THE LEARNED CIT REFUSED REGISTRATION U/S. 12AA BY HOLDING THAT THE OBJECTS OF THE TRUST MORE SPECIFICALLY OBJECTS NO. 2 & 3 WERE RELIGIOUS OBJECTS. IT WAS THE SUBMISSION THAT THE LEARNED CIT WAS OF T HE VIEW THAT THE ASSESSEE TRUST WAS HAVING THE OBJECT OF PROPAGATING THE TEAC HINGS OF HIS HOLINESS SHRI SHIRDI SAI BABA AND CONSEQUENTLY THE ASSESSEE WAS N OT A CHARITABLE TRUST BUT WAS A RELIGIOUS TRUST. IT WAS THE SUBMISSION THAT THE LEARNED CIT HAD RELIED UPON THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE O F UPPER GANGES SUGAR MILLS LTD. & ORS. V. CIT REPORTED IN 227 ITR 578 TO DENY THE ASSESSEE THE BENEFIT OF REGISTRATION U/S. 12AA AND U/S. 80G. IT WAS THE SU BMISSION THAT THE HONBLE MADRAS HIGH COURT IN THE CASE OF NEW LIFE IN CHRIST EVANGELISTIC ASSOCIATION V. CIT AND ANOTHER REPORTED IN 246 ITR 532 HAD HELD TH AT FOR REGISTRATION OF THE SOCIETY U/S. 12A THE ONLY REQUISITES WERE THAT THE APPLICATION FOR REGISTRATION SHOULD BE MADE IN TIME AND THE ACCOUNTS OF THE INST ITUTION SHOULD BE AUDITED AND THE ENQUIRY INTO THE OBJECTS OF THE INSTITUTION CAN NOT BE MADE U/S. 12A. HE FURTHER RELIED UPON THE DECISION OF THE HONBLE RAJ ASTHAN HIGH COURT IN THE CASE ITA NOS. 1946 & 1947/MDS/09 3 OF SRI MARUDHAR KESARI STHANAKWASI JAIN YADGAR SAMI TI TRUST V. UNION OF INDIA AND ANOTHER REPORTED IN 273 ITR 475 WHEREIN IT HAS BEEN BROUGHT OUT THAT WITH EFFECT FROM 01-04-2000 EVEN IF ONE OR MORE CLAUSES OF THE TRUST DEED WAS WHOLLY AND SUBSTANTIALLY RELIGIOUS IF THE INCOME-EXPENDIT URE RATIO IN RESPECT OF THE EXPENSES INCURRED ON SUCH PURPOSES FALLS WITHIN THE AMBIT OF SECTION 80G(5B) IT SHALL STILL BE TREATED AS AN INSTITUTION TO WHICH T HE PROVISIONS OF SECTION 80G WOULD APPLY AND THE DONATIONS WOULD QUALIFY FOR DED UCTION U/S. 80G. IT WAS THE SUBMISSION THAT THE DECISION RELIED UPON BY THE LEA RNED CIT IN THE CASE OF UPPER GANGES SUGAR MILLS LTD. & ORS. REFERRED TO SUPRA WOULD NOT APPLY INSOFAR AS THE ASSESSEE WAS NOT A RELIGIOUS TRUST AND WAS NOT DOIN G ANY RELIGIOUS ACTIVITIES. IT WAS THE SUBMISSION THAT THE CONSTRUCTION OF A PRAYE R HALL WOULD NOT MAKE THE ACTIVITIES OF THE ASSESSEE RELIGIOUS. IT WAS THE SUBMISSION THAT THE ASSESSEE MAY BE GRANTED REGISTRATION UNDER SECTION 12AA AND 80G. 4. IN REPLY THE LEARNED DEPARTMENTAL REPRESENTATIVE SUBMITTED THAT THE OBJECTS OF THE TRUST WERE CLEARLY RELIGIOUS. THE F ACT THAT THE OBJECTS OF THE TRUST CONTAINED ESTABLISHMENT AND MANAGEMENT OF DHARMASAL AS PRAYER HALLS DISTRIBUTION OF TEXTS AND STUDY MATERIAL IN RESPECT OF THE LIFE OF HIS HOLINESS SHRI SHIRDI SAI BABA ALL CLEARLY SHOWED THAT THE OBJECTS OF THE TRUST WERE RELIGIOUS. IT WAS THE SUBMISSION THAT THE OBJECTS OF THE TRUST DI D NOT FALL WITHIN THE MEANING OF CHARITABLE ACTIVITIES AS PROVIDED IN SECTION 2(1 5) OF THE ACT. HE FURTHER PLACED RELIANCE ON THE DECISION OF THE HONBLE KERALA HIGH COURT IN THE CASE OF M.P. SANTHIVARMA JAIN V. STATE OF KERALA AND ANOTHER REP ORTED IN 265 ITR 385 ITA NOS. 1946 & 1947/MDS/09 4 WHEREIN AFTER GOING THROUGH THE TRUST DEED HAVING F OUND THAT THE DOMINANT PURPOSE OF THE TRUST WAS THE PROPAGATION OF JAIN RE LIGION THE TRUST WAS HELD TO BE NOT A PUBLIC CHARITABLE TRUST. IT WAS THE SUBMISSI ON THAT THE LEARNED CIT HAD ALSO DENIED THE ASSESSEE THE REGISTRATION AS A PUBLIC CH ARITABLE TRUST AND THE CIT HAD HELD THAT THE TRUST IS ELIGIBLE FOR REGISTRATION AS A PUBLIC RELIGIOUS TRUST. IT WAS THE SUBMISSION THAT HE HAD NO OBJECTION IF THE ASSESSEE IS TREATED AS A PUBLIC RELIGIOUS TRUST. IT WAS SUBMITTED THAT THE ORDER O F THE LEARNED CIT HAD TO BE UPHELD. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. A PER USAL OF THE OBJECTS OF THE TRUST SHOWS THAT THE PREDOMINANT OBJECTS OF THE TRU ST ARE OF PUBLIC RELIGIOUS CHARACTER. THERE ARE ALSO CLAUSES IN THE OBJECTS W HICH HAVE THE CHARACTERISTIC OF A PUBLIC CHARITABLE TRUST. IT IS ALSO NOTICED THAT THE TRUST HAS BEEN CREATED BY A DOCUMENT DATED 21-04-2008. THE TRUST HAS ALSO INCU RRED AN EXPENDITURE OF RS. 12 LAKHS TILL THE DATE OF APPLICATION FOR REGISTRA TION FOR THE CONSTRUCTION OF A MEDITATION HALL. A MEDITATION HALL NO DOUBT WOUL D HAVE RELIGIOUS OVERTONES. MEDITATION IS ALSO RECOGNIZED IN YOGA. THUS IT CAN NOT BE SAID THAT THE CONSTRUCTION OF A MEDITATION HALL AS SUCH WOULD MAK E THE ASSESSEE A PURELY RELIGIOUS TRUST. IT IS HOWEVER ALSO NOT CLEAR AS T O WHAT ARE THE ACTIVITIES THAT HAVE BEEN CONDUCTED IN THIS MEDITATION HALL. IT IS FURT HER NOTICED THAT AS PER THE PROVISIONS OF SECTION 12AA (1)(B) OF THE ACT THE LE ARNED CIT HAS TO SATISFY HIMSELF ABOUT THE OBJECTS OF THE TRUST OR INSTITUTION AND T HE GENUINENESS OF SUCH ACTIVITIES. HERE IT IS NOTICED THAT THE LEARNED CI T HAS DECIDED THE ISSUE OF THE ITA NOS. 1946 & 1947/MDS/09 5 OBJECTS OF THE TRUST WITHOUT CONSIDERING THE GENUIN ENESS OF THE ACTIVITIES. AS MENTIONED EARLIER THOUGH THE OBJECTS OF THE TRUST DO CONTAIN RELIGIOUS OVERTONES THEY ALSO CONTAIN OBJECTS WHICH ARE CHARITABLE IN N ATURE AS PROVIDED IN SECTION 2(15) OF THE ACT. IN THE CIRCUMSTANCES WE ARE OF THE VIEW THAT THE ISSUE OF REGISTRATION UNDER SECTIONS 12AA AND 80G SHOULD BE RESTORED TO THE FILE OF THE LEARNED CIT FOR RE-ADJUDICATION AFTER VERIFYING THE GENUINENESS OF THE ACTIVITIES OF THE ASSESSEE ALSO AND WE DO SO. THE LEARNED CIT SH ALL IN THE SET ASIDE PROCEEDINGS GET VERIFIED AS TO THE ACTIVITIES THAT ARE BEING CONDUCTED BY THE TRUST. IF IT IS FOUND THAT THE MEDITATION HALL SO CLAIMED IS IN FACT A TEMPLE OR A PLACE OF RELIGIOUS ACTIVITIES THEN THE LEARNED CIT MAY CONSIDER REGISTERING THE ASSESSEE AS A PUBLIC RELIGIOUS TRUST. IF ACTUAL CH ARITABLE ACTIVITIES ARE BEING CONDUCTED THEN THE LEARNED CIT SHALL GRANT THE ASS ESSEE REGISTRATION AS CHARITABLE TRUST UNDER SECTION12AA AND ALSO GRANT T HE ASSESSEE THE CONSEQUENTIAL REGISTRATION UNDER SECTION 80G. IN THE CIRCUMSTANC ES THE ISSUE OF GRANT OF REGISTRATION U/S. 12AA AND 80G IS RESTORED TO THE F ILE OF THE CIT FOR RE- ADJUDICATION IN THE LINE WITH THE DIRECTIONS GIVEN ABOVE. 6. IN THE RESULT APPEALS OF THE ASSESSEE ARE ALLOW ED FOR STATISTICAL PURPOSES. 7. ORDER WAS PRONOUNCED ON 09-07-2010. SD/- SD/- ( P. P. PARIKH ) (GEORGE MATH AN) VICE PRESIDENT. JUDICIAL MEM BER CHENNAI DATED THE 9 TH JULY 2010. H. ITA NOS. 1946 & 1947/MDS/09 6 COPY TO: (1) APPELLANT (2) RESPONDENT (3) CIT(A) (4) CIT (5) D.R. (6) GUARD FILE