The DCIT, Circle-2(1)., Vijayawada v. M/s Roman Catholic Diocese of Hyderabad Deccan Society, Vijayawada

ITA 248/VIZ/2008 | 2005-2006
Pronouncement Date: 05-05-2010 | Result: Dismissed

Appeal Details

RSA Number 24825314 RSA 2008
Assessee PAN AAAAJ2585N
Bench Visakhapatnam
Appeal Number ITA 248/VIZ/2008
Duration Of Justice 1 year(s) 11 month(s) 23 day(s)
Appellant The DCIT, Circle-2(1)., Vijayawada
Respondent M/s Roman Catholic Diocese of Hyderabad Deccan Society, Vijayawada
Appeal Type Income Tax Appeal
Pronouncement Date 05-05-2010
Appeal Filed By Department
Order Result Dismissed
Bench Allotted DB
Tribunal Order Date 05-05-2010
Date Of Final Hearing 09-03-2010
Next Hearing Date 09-03-2010
Assessment Year 2005-2006
Appeal Filed On 12-05-2008
Judgment Text
1 IN THE INCOME TAX APPELLATE TRIBUNAL VISAKHAPATNAM BENCH VISAKHAPATNAM BEFORE: SHRI SUNIL KUMAR YADAV JUDICIAL MEMBER AND SHRI BR BASKARAN ACCOUNTANT MEMBER S. NO CASE NO. A.Y PAN NO APPELLANTS RESPONDENTS 1 ITA NO. 423/V/07 2004-05 AAAAJ 2585 N ACIT CIRCLE-2(1) VIJAYAWADA ROMAN CATHOLIC DIOCESE OF HYDERABAD DECCAN SOCIETY VIJAYAWADA 2 ITA NO. 246/V/08 2000-01 AAAAJ 2585 N DCIT CIRCLE-2(1) VIJAYAWADA ROMAN CATHOLIC DIOCESE OF HYDERABAD DECCAN SOCIETY VIJAYAWADA 3 ITA NO. 247/V/08 2001-02 AAAAJ 2585 N DCIT CIRCLE-2(1) VIJAYAWADA ROMAN CATHOLIC DIOCESE OF HYDERABAD DECCAN SOCIETY VIJAYAWADA 4 ITA NO. 248/V/08 2005-06 AAAAJ 2585 N DCIT CIRCLE-2(1) VIJAYAWADA ROMAN CATHOLIC DIOCESE OF HYDERABAD DECCAN SOCIETY VIJAYAWADA APPELLANT BY : SHRI SUBRATA SARKAR CIT(DR) RESPONDENT BY : SHRI K. BALAJI NAGARAJU & K. CHENNUBOTLU O R D E R PER BENCH: 1. THE APPEALS OF THE REVENUE ARE DIRECTED AGAIN ST THE ORDERS PASSED BY LD CIT(A) VIJAYAWADA AND THEY RELATE TO THE ASSESSMEN T YEARS 2000-01 2001-02 2004-05 AND 2005-06. SINCE THE ISSUES AGITATED IN ALL THESE APPEALS ARE IDENTICAL 2 IN NATURE AND SINCE THEY WERE HEARD TOGETHER WE FI ND IT CONVENIENT TO DISPOSE THEM OF BY THIS COMMON ORDER. 2. THE GROUNDS OF APPEAL RAISED BY THE REVENUE GIVE RISE TO A SOLITARY ISSUE VIZ. WHETHER THE LD CIT(A) IS RIGHT IN HOLDING THA T THE PROVISIONS OF S. 13(1)(B) OF THE ACT IS NOT APPLICABLE TO THE ASSESSEE. 3. THE FACTS RELATING TO THE ISSUE ARE SET OUT IN BRIEF. THE ASSESSEE IS A SOCIETY REGISTERED UNDER THE SOCIETIES REGISTRATION ACT 186 0 VIDE REGISTRATION NO.2/1925- 26 DATED 08/12/1925 . THE ASSESSEE SOCIETY WAS ALSO REGISTERED U/S 12A OF THE INCOME TAX ACT VIDE NOTIFICATION NO. SIB NO.1 (MIS C.)//73-74 DATED 24.3.1973. THE OBJECTS OF THE SOCIETY ARE MAINLY PROMOTION OF LITERATURE AD SCIENCE THE DIFFUSION OF USEFUL KNOWLEDGE AND CHARITABLE PURPOS ES. AS PER THE MEMORANDUM OF ASSOCIATION OF THE SOCIETY THE MEANS EMPLOYED F OR THE ATTAINMENT OF ITS OBJECTIVES ARE: (I) THE PROVISION FOR MAINTENANCE OF HIGH SCHOOLS HIGHER SECONDARY SCHOOLS PRIMARY SCHOOLS INDUSTRIAL SCHOOLS (I.T.I ) ORPHANAGES HOSPITALS DISPENSARIES AND OTHER CHARITABLE INSTITUTIONS BELO NGING TO THE DIOCESE OF HYDERABAD DECCAN. (II) THE SUPPLY AND MAINTENANCE OF PROFESSORS AND TEACHERS THEREFORE AND OF BOOKS AND OTHER NECESSARIES INCIDENTAL TO THE CA RRYING OUT OF SUCH EDUCATIONAL VENTURES AS MAY FROM TIME TO TIME SEEM GOOD AND NEC ESSARY IN THE ESTIMATION OF THE GOVERNING BODY AND IN ACCORDANCE WITH THE MADRA S EDUCATIONAL CODE (ANDHRA PRADESH EDUCATIONAL RULES). IN THE RULES AND REGULATIONS IT WAS MENTIONED THAT ALL THE EDUCATIONAL INSTITUTIONS ARE MEANT PRIMARILY FOR THE CATHOLIC M INORITY COMMUNITY BUT ARE OPEN TO ALL IRRESPECTIVE OF CASTE CREED OR COMMUNITY. 3.1 THE ASSESSEES RETURN OF INCOME RELATING TO THE ASSESSMENT YEAR 2004-05 WAS SELECTED FOR SCRUTINY. IN THAT YEAR THE ASSES SEE HAD GROSS RECEIPTS TO THE 3 TUNE OF RS.11.75 CRORES. IT HAD SPENT A SUM OF RS. 10.12 CRORES OUT OF WHICH AN AMOUNT OF RS.0.67 CRORE HAD BEEN SPENT UNDER THE FO LLOWING HEADS: NATURE OF EXPENDITURE AMOUNT A. PAID TO PARISHES 10 41 457 B. PAID TOWARDS CATECHISTS ALLOWANCES & MAINTENANCE 22 32 540 C. PAID TOWARDS PRIESTS ALLOWANCES 24 86 900 D. TOWARDS PARISH LEVEL TRAINING CAMPS 4 84 252 E. PAID TOWARDS ALLOWANCES OF NUN 4 10 450 --------------- 66 55 599 ======== ON THE BASIS OF THE DESCRIPTIONS OF THESE EXPENSES THE AO TREATED THEM AS EXPENSES INCURRED TOWARDS RELIGIOUS PURPOSES. FURT HER AS PER THE RULES AND REGULATIONS OF THE SOCIETY THE EDUCATIONAL INSTITU TIONS ARE MEANT PRIMARILY FOR CATHOLIC MINORITY COMMUNITY. THE AO ALSO CALLED FO R THE STATEMENT IN FORM FC-3 FILED AS PER THE PROVISIONS OF SECTION 13 OF THE FO REIGN CONTRIBUTION (REGULATION) ACT 1976 AND IT WAS NOTICED THAT THE ASSESSEE SOCI ETY HAS DECLARED THAT IT HAD SPENT A SUM OF RS.3.51 CRORES TOWARDS RELIGIOUS ACT IVITIES. THE ASSESSEE SUBMITTED REPEATEDLY THAT IT WAS ENGAGED IN CHARITA BLE ACTIVITIES ONLY IN ACCORDANCE WITH ITS OBJECTS BUT IT DID NOT FIND FA VOUR WITH THE ASSESSING OFFICER. IN VIEW OF HIS FINDINGS THE AO FELT THAT THE PROVI SIONS OF SECTION 13(1)(B) SHALL APPLY TO THE ASSESSEE AND IN THAT CASE THE ASSESSE E WOULD LOOSE EXEMPTION U/S 11. ACCORDINGLY THE AO DENIED EXEMPTION U/S 11 AND BROUGHT ENTIRE GROSS RECEIPTS UNDER TAX NET AND FRAMED THE ASSESSMENT OR DER ACCORDINGLY. THE ASSESSMENT RELATING TO THE ASSESSMENT YEAR 2005-06 WAS ALSO COMPLETED IN THE SIMILAR MANNER. THE ASSESSMENTS RELATING TO THE AS SESSMENT YEARS 2000-01 AND 2001-02 WERE ALSO REOPENED AND WERE COMPLETED IN TH E MANNER STATED ABOVE. THE DETAILS OF THE ASSESSMENT RELATING TO THE ASSES SMENT YEARS 2002-03 AND 2003-04 WERE NOT DISCUSSED BEFORE US. 4 4. HENCE THE MAIN ISSUE BEFORE US IS WHETHER TH E PROVISIONS OF SECTION 13(1)(B) SHALL APPLY TO THE ASSESSEE OR NOT. FOR T HE SAKE OF CONVENIENCE WE REPRODUCE BELOW THE SAID SECTION: 13. (1) NOTHING CONTAINED IN SECTION11 OR SECTION 12 SHALL OPERATE SO AS TO EXCLUDE FROM THE TOTAL INCOME OF THE PREVIOUS YEAR OF THE PERSON IN RECEIPT THEREOF---- (A) .. (B) IN THE CASE OF A TRUST FOR CHARITABLE PURPOSES OR A CHARITABLE INSTITUTION CREATED OR ESTABLISHED AFTER THE COMMENCEMENT OF THIS ACT ANY INCOME THEREOF IF THE TRUST OR INSTITUTION IS CREATED OR ESTABLISHED FOR THE BENEFIT OF ANY PARTICULAR COMMU NITY OR CASTE. THE PRESENT INCOME TAX ACT 1961 CAME INTO EFFECT F ROM 01-04-1962. IT IS NOT IN DISPUTE THAT THE ASSESSEE SOCIETY WAS REGISTERED ON 08-12-1925 I.E. BEFORE THE COMMENCEMENT OF INCOME TAX ACT 1961. BASED ON TH ESE FACTS THE LD CIT(A) HAS ANALYSED THE SCOPE OF THE PROVISIONS OF SECTION 13(1)(B) OF THE ACT AND ITS APPLICABILITY IN THE HANDS OF THE ASSESSEE SOCIETY. THE RELEVANT OBSERVATIONS OF LD CIT(A) ARE EXTRACTED BELOW. 6.2 THE PROVISIONS OF SEC. 13(1)(B) CAN BE INVOKED ONLY WHEN I) THE TRUST IS CREATED FOR CHARITABLE PURPOSES AND II) THE CHARITABLE TRUST OR CHARITABLE INSTITUTION IS C REATED OR ESTABLISHED AFTER THE COMMENCEMENT THIS ACT AND III) ANY INCOME OF SUCH TRUST HAS BEEN UTILIZED FOR THE BENEFIT OF A PARTICULAR RELIGIOUS COMMUNITY OF CASTE. IN ORDER TO DENY EXEMPTION OF SEC.11 & 12 TO A TRUS T THE ABOVE THREE CONDITIONS OF SEC.13(1)(B) SHOULD BE FULFILLE D SIMULTANEOUSLY. IN CASE EVEN ONE OF THEM IS NOT FULFILLED THE EXEM PTION U/S. 11 & 12 CANNOT BE DENIED U/S 13(1)(B). THE APPELLANT IS A T RUST CREATED WHOLLY FOR CHARITABLE PURPOSE AS HELD IN PARA NO.5. 5 OF THIS ORDER. THIS TRUST WAS CREATED UNDER THE SOCIETYS REGISTRA TION ACT 1860 5 VIDE REGISTRATION NO.2/1925-26 DT: 8/12/1925. THE I NCOME OF THE APPELLANT TRUST HAS ALSO NOT BEEN UTILIZED FOR THE BENEFIT OF ANY PARTICULAR RELIGIOUS COMMUNITY OR CASTE AS HELD IN PARA NO.5.4 OF THIS ORDER. THE APPELLANT TRUST IS A CHARITABLE TRUST AN D IT HAS NOT BEEN CREATED OR ESTABLISHED AFTER THE COMMENCEMENT OF AC T 1961 AND THE INCOME OF THE APPELLANT TRUST HAS NOT BEEN UTIL IZED FOR THE BENEFIT OF ANY RELIGIOUS COMMUNITY OR CASTE. THUS THE CASE OF THE APPELLANT IS SQUARELY COVERED BY THE FOLLOWING DECISIONS: (A) THE HONBLE M.P. HIGH COURT IN THE CASE OF CIT VS. SHRI MAHESHWARI AGRAWAL MARWARI PANCHAYAT (136 ITR 556) HAS HELD THAT THE BAR U/S 13(1)(B) IS NOT APPLICABLE TO A CHARITABLE TRUST WHICH WAS CREATED OR ESTABLISHED BEFORE THE COMMENCEMENT OF THE ACT. (B) THE HONBLE ITAT RAJKOT SMC BENCH IN THE CASE OF RAJKOT SHRI MALI JAIN SAMAJ VS. ITO (190 TTJ 226) HAS HELD THAT THE PROVISIONS OF SEC.13(1) (B) WOULD NOT APPLY TO A TR UST CREATED BEFORE THE COMING INTO FORCE OF THE INCOME-TAX ACT 1961 4.1 ON A PLAIN READING OF SECTION 13(1)(B) WE NOTICE THAT THE SAID PROVISIONS SHALL APPLY TO A CHARITABLE SOCIETY OR C HARITABLE INSTITUTION WHICH IS CREATED OR ESTABLISHED AFTER THE COMMENCEMENT OF THE PRESENT INCOME TAX ACT 1961. THERE IS NO DISPUTE WITH REGARD TO THE FACT THAT THE ASSESSEE SOCIETY WAS ESTABLISHED PRIOR TO THE COMMENCEMENT O F THE PRESENT INCOME TAX ACT. IN THAT CASE THE PROVISIONS OF SECTION 1 3(1)(B) SHALL NOT APPLY TO THE ASSESSEE AND HENCE WE AGREE WITH THE VIEWS OF T HE LD CIT(A). 4.2 THE ASSESSMENT OF THE FOUR YEARS UNDER CONS IDERATION HAS BEEN FRAMED BY THE AO BY INVOKING THE PROVISIONS OF SECT ION 13(1)(B) OF THE ACT ONLY. SINCE WE HAVE ALREADY HELD THAT THE PROVISIO NS OF SECTION 13(1)(B) SHALL NOT APPLY TO THE ASSESSEE ALL THE FOUR ASSES SMENTS ARE LIABLE TO BE QUASHED AND WE ORDER ACCORDINGLY. 5. WE NOTICE THAT THE LD CIT(A) HAS ALSO CONSI DERED IN A DETAILED MANNER THE NATURE OF EXPENDITURE INCURRED BY THE A SSESSEE INCLUDING THAT WAS SHOWN IN FORM FC-1 SUBMITTED UNDER THE FOREIGN CONTRIBUTION 6 (REGULATION) ACT. THE OBSERVATIONS OF THE LD CIT( A) IN THIS REGARD ARE EXTRACTED BELOW: 5. I HAVE CAREFULLY PERUSED THE OBSERVATIONS OF TH E A.O. VARIOUS SUBMISSIONS CASE LAWS RELIED BY THE APPELLANT AND MORE IMPORTANTLY PAPER BOOK NO.1 & 2 CONTAINING DETAILS AND SUPPORTI NG EVIDENCES FOR PAYMENTS TOWARDS ALLOWANCES TO PRIESTS CATECHISTS NUNS PARISHES LEVEL TRAINING CAMPS CONSTRUCTION/REPAIRS/MAINTENA NCE OF SCHOOLS/EDUCATIONAL INSTITUTIONS/CHAPELS ETC. THE APPELLANT TRUST IS RUNNING 167 INSTITUTIONS IMPARTING EDUCATION FROM PRIMARY LEVEL TO HIGHER SECONDARY LEVEL INCLUDING VOCATIONA L TRAINING CENTERS AND ALSO SCHOOLS FOR PHYSICALLY CHALLENGED PERSONS. THE APPELLANT SOCIETY HAS ALSO SET UP NEARLY 55 BOARDING HOMES/ORPHANAGES/HOSTELS FOR PRIMARY TO SECONDARY EDUCATION FOR THE BENEFITS OF BOYS AND GIRLS HAILING FROM BAC KWARD COMMUNITIES. MAJOR JOBS ARE TO SUPERVISE CORRESPON D CONTROL REGULATE VARIOUS EDUCATIONAL INSTITUTIONS/ORPHANAGE S/BOARDING HOMES VOCATIONAL TRAINING CENTERS/LEPROSY CENTERS OLD-AGE HOMES SOCIAL SERVICE CENTER ETC. SOME OF THE PRIESTS ARE RENDERING SERVICES AS CORRESPONDENTS OF VARIOUS SCHOOLS AND T HEIR APPOINTMENTS ARE CONFIRMED BY THE GOVT. OF ANDHRA PRADESH. THE JOB OF THE CORRESPONDENT IS TO CORRESPOND WITH THE EDUCATION DEPARTMENT ADMINISTER THEIR SCHOOLS AND ACT AS A BRIDGE BETWEEN THE SCHOOLS AND EDUCATION DEPARTMENT. THE A PPELLANT ALSO FURNISHED DETAILS OF NAMES AND PLACES FROM WHERE SU CH EDUCATIONAL INSTITUTIONS ARE BEING RUN BY THE TRUST. APPELLANT ALSO FURNISHED MONTH-WISE DETAILS OF ALLOWANCES PAID TO PRIESTS C ATECHISTS AND PARISHES. IT HAS ALSO FILED FURTHER ELABORATE DETAILS OF ALLOWANCES PAID TO ALL PRIESTS AND CATECHISTS. APPE LLANT FURNISHED A LETTER DT. 20/06/2007 FROM DY. GENERAL MANAGER RCM SCHOOL KRISHNA MACHILIPATNAM CONTAINING THE NAMES OF CORR ESPONDENTS APPROVED BY DISTRICT EDUCATION OFFICER KRISHNA. TH E DY. GENERAL MANAGER RCM HAS CONFIRMED VIDE LETTER DT. 20/06/20 07 THAT THE PRIESTS CATECHISTS AND PARISHES APPEARING IN THE S AID LIST ARE ACTIVELY INVOLVED WORKING IN VARIOUS FIELDS OF EDUCATION SUCH AS MANAGERS/WARDENS WORKING IN THE BOARDING HOMES/HOSTELS PROVIDING FREE BOARDING FACILITIES IRRESPECTIVE O F CASTE AND CREED. HE HAS ALSO CONFIRMED THAT THESE I NDIVIDUALS ARE NOT INVOLVED IN ANY RELIGIOUS TEACHING RATHER THEY ARE INVOLVED IN SOCIAL CAUSE OF THE POOR AND MARGINALIZED. 5.1 THE PARISHES LEVEL CAMPS ARE ORGANIZED FOR THE YOUTHS AT PERIODICAL SESSIONS IN DIFFERENT PARTS OF THE DISTR ICT. THE PREDOMINANT OBJECTIVE OF ORGANIZING SUCH CAMPS IS TO STRENGTHEN NATIONAL INTEGRATION AND TO PROVIDE CAREER ORIENTED GUIDANCE 7 FOR THEIR GROWTH . THE APPELLANT ALSO FURNISHED A LIST OF PLACES OR CENTERS AND NATURE OF WORK DONE DURING THE YEAR. AL ONG WITH THE SAID DETAILS PRESS CLIPPINGS COVERING VARIOUS PARISHES LEVEL CAMPS HAVE ALSO BEEN FURNISHED . THE STATEMENT OF ACCOUNTS MAINTAINED FOR THESE PARISHES LEVEL CAMPS CONTAIN DATE-WISE DETAILS OF VARIOUS EXPENSES INCURRED LIKE PROVISIONS I.E. B ISCUITS VEGETABLES FIRE WOODS FRUITS EGGS MILK ETC. FOR THESE CAMP S. THE PRESS CUTTINGS ALSO INDICATE THAT THESE CAMPS WERE ORGANI ZED FOR THE SAID PURPOSE. THE APPELLANT ALSO FURNISHED COPY OF MINUT ES OF THE MEETING OF THE GOVERNING BODY OF THE APPELLANT SOCI ETY HELD ON 6/5/2003 WHERE RESOLUTIONS WERE PASSED AND DIRECTIO N WAS GIVEN TO CORRESPONDENTS AND MANAGERS/CATECHISTS/WARDENS OF H OSTELS TO TAKE ACTIVE ROLE AND CONTRIBUTE THEIR SERVICES FOR THE W ELFARE OF THE PEOPLE IN THE FOLLOWING AREAS: EDUCATION AND HEALTH TO THE CHILDREN BELOW POVERTY LINE HEALTH AND HYGIENE TO THE RURAL POPULATION PROMOTION OF COMMUNAL HARMONY AMONG ALL RELIGIOUS C OMMUNITY PROMOTION OF EMPLOYMENT OPPORTUNITIES TO THE RURAL YOUTH PROVISION OF FOOD AND ACCOMMODATION TO THOSE WHO NE ED MOST URGENTLY NEED DUE TO NATURAL CALAMITIES AND EMERGEN CY CONDITIONS PRIORITY OF EDUCATION TO GIRL CHILD AND EMPOWERMENT OF VILLAGE WOMEN ERADICATION OF CHILD LABOUR AND PROVIDING THEM WITH SKILLS TO BUILD THEIR CAREER. 5.2 APPELLANT ALSO FURNISHED 18 AFFIDAVITS FROM CATECHI STS IN RESPECT OF NORMAL REMUNERATION PAID TO THEM TOWARDS RENDERI NG SERVICES FOR CHILD WELFARE EDUCATION AGAINST SUPERSTITION ADULT EDUCATION WOMEN EMPOWERMENT LITERARY PROGRAMME RURAL DEVELO PMENT WORKING WITH VILLAGE WORKING WITH DWARAKA GROUPS WORKING FOR RURAL DEVELOPMENT WELFARE OF WOMEN CULTURAL ACTIV ITY HEALTH CARE AND EDUCATION AND EDUCATION AGAINST CHILD LABO UR. APPELLANT ALSO FURNISHED A LIST FOR ALLOWANCES PAID TO NUNS W HO RUN TWO INSTITUTIONS NAMELY AASSISSI DERMATOLOGICAL CENTRE PEDANA AND ST. CATHADRAL REHABILITATION CENTRE TIRUVURU FOR T HE BENEFIT OF ALL CATEGORIES OF PEOPLE. THESE CENTERS HAVE BEEN WORKI NG WITH THE COLLABORATION WITH THE GOVERNMENT FOR ERADICATION O F LEPROSY. NUNS (SISTERS) ARE RENDERING THEIR SERVICES AT THES E CENTERS AND IN LIEU OF THEIR SERVICES MAINTENANCE ALLOWANCE HAV E BEEN PAID TO THEM. APPELLANT FURNISHED A COPY OF PROJECT REPORT FOR THE WORK UNDERTAKEN BY THESE TWO INSTITUTIONS. IT HAS ALSO F URNISHED COPY OF PRESS CUTTINGS EVIDENCING THE ACTIVITIES UNDERTA KEN BY THEM. THE APPELLANT FURTHER FURNISHED A STATEMENT DT. 28/ 11/2006 ISSUED BY S.C.R.C. NUZVID EXTENT RCC SEVASADAN LA XMIPURAM 8 TIRUVUR ABOUT THE NATURE OF SERVICES RENDERED BY SI STERS FOR THE WELFARE OF THE POOR AND MEDICAL WORKS DEALING WITH LEPROSY. IT HAS ALSO BEEN STATED THAT THIS INSTITUTION I.E. RCC SEVASADAN IS IN NO WAY ENGAGED IN RELIGIOUS ACTIVITY AND A GROUP OF SISTERS ARE COMMITTED FOR THE CAUSE OF THE POOR AND ERADICATION OF THE LEPROSY IN THIS AREA. APPELLANT FURTHER FURNISHED L IST OF JBL HOME FOR THE AGED PEOPLE RUN BY IT AND THE ACTIVITIES CA RRIED OUT BY THE JBL HOMES. IT HAS ALSO FURNISHED EVIDENCES IN RESPE CT OF VARIOUS EXPENSES INCURRED ON THESE AGED HOMES. 5.3 APPELLANT FURNISHED EXPENSES DETAILS RELATING TO CO NSTRUCTION AND RENOVATION OF THE SCHOOLS AND BUILDINGS ALONG WITH STATEMENT OF ACCOUNTS CONTAINING DATE-WISE EXPENSES WITH NATURE. THESE STATEMENTS OF ACCOUNT REVEAL THAT EXPENSES HAVE BEE N INCURRED FOR CARRYING OUT CONSTRUCTION/ REPAIRS WORKS IN RES PECT OF THE BUILDINGS/INSTITUTES. 5.4 IN VIEW OF THE ABOVE I DO NOT UPHOLD THE VIEW OF T HE A.O THAT SOME OF THE EXPENSES HAVE BEEN INCURRED ON RELIGIOU S ACTIVITIES THUS THE LD CIT(A) ON MERITS ALSO HAS HELD THAT T HE EXPENSES INCURRED BY THE ASSESSEE SOCIETY ARE NOT RELIGIOUS IN NATURE. FROM THE ASSESSMENT ORDER WE NOTICE THAT THE AO HAS REACHED HIS CONCLU SIONS ONLY ON THE BASIS OF THE DESCRIPTION OF THE HEADS OF THE EXPENDITURE. HOWEVER THE LD CIT(A) HAS HELD THAT THE EXPENSES INCURRED BY THE ASSESSEE SOCIETY ARE NOT RELIGIOUS IN NATURE AFTER CONSIDERING THE NATURE OF EXPENSES INCURRED BY THE ASSESSEE. THERE CANNOT BE ANY DISPUTE THAT THE NAT URE OF EXPENSES INCURRED BY THE ASSESSEE IS MORE RELEVANT FOR THE P ROCEEDINGS UNDER THE INCOME TAX ACT AND HENCE THE DESCRIPTION OF THE EXP ENSES GIVEN IN THE ACCOUNTS OR IN ANY OF THE RETURNS IS NOT RELEVANT. 6. THE LD CIT(A) HAS ALSO WENT ON TO ASCERTAIN WHETHER THE ASSESSEE SOCIETY IS A WHOLLY CHARITABLE INSTITUTION OR NOT. IN THIS REGARD THE LD CIT(A) HAS CONSIDERED FOLLOWING CASE LAW. A. CIT V SOCIAL SERVICES CENTRE (250 ITR 39 (AP) B. JESUIT MADURAI PROVINCE (17 TTJ 532 (MADRAS) C. CIT VS. BARKATE SAIFIAYAH SOCIETY (213 ITR 492 (GUJ)) D. CIT VS. ANDHRA CHAMBERS OF COMMERCE (55 ITR 72 2 (AP)) E. AHMEDABAD RANA CASTE ASSOCIATION V CIT (82 ITR 704 (SC)) AFTER DISCUSSING THE GIST OF THE EACH OF THE DECISI ONS CITED ABOVE AND ALSO SOME MORE DECISIONS THE LD CIT(A) HAS OBSERVED IN PARA 5.5 THAT IN VIEW 9 OF THE OBJECTS OF THE TRUST AND THE ACTIVITIES UNDE RTAKEN BY IT THE ASSESSEE SOCIETY IS A TRUST WHOLLY FOR CHARITABLE PURPOSES. 6.1 AS NOTED EARLIER THE ASSESSEE SOCIETY HAS BEEN GIVEN REGISTRATION U/S 12A OF THE ACT. THE LD CIT(A) HAS GIVEN A CLEAR F INDING ON MERITS THAT THE ASSESSEE SOCIETY HAS INCURRED THE EXPENSES FOR CHAR ITABLE PURPOSES ONLY. THE LD CIT(A) HAS GONE A STEP FURTHER IN OBSERVING THAT THE ASSESSEE SOCIETY IS A TRUST WHOLLY FOR CHARITABLE PURPOSES. ON PLAIN READING OF SECTION 13(1)(B) ALSO WE HAVE NOTICED THAT THE SAI D SECTION IS NOT APPLICABLE TO THE ASSESSEE SOCIETY AND ACCORDINGLY HELD THAT THE ASSESSMENTS FRAMED IN THESE FOUR YEARS ON THE STREN GTH OF SECTION 13(1)(B) ARE TO BE QUASHED. IN VIEW OF THE FOREGOING WE D O NOT FIND ANY INFIRMITY IN THE DECISION OF LD CIT(A) AND ACCORDINGLY UPHOLD THE ORDERS PASSED BY HIM. 7. IN THE RESULT ALL THE FOUR APPEALS FILED BY THE REVENUE ARE DISMISSED. PRONOUNCED ACCORDINGLY ON 5 TH MAY 2010. SD/- SD/- (SUNIL KUMAR YADAV) (B.R. BASKARAN) JUDICIAL MEMBER ACCOUNTANT MEMBER PVV/SPS VISAKHAPATNAM DATE : 05-05-2010. A COPY OF THIS ORDER IS FORWARDED TO : 01 ACIT CIRCLE-2(1) VIJAYAWADA 02 ROMAN CATHOLIC DIOCESE OF HYDERABAD DECCAN SOCIE TY BISHOPS HOUSE RING ROAD NEAR BENZ CIRCLE VIJAYAWADA 520 008 03 THE DCIT CIRCLE-2(1) VIJAYAWADA 04 THE CIT (A) VIJAYAWADA 05 THE CIT VIJAYAWADA 06 THE DR ITAT VISAKHAPAATNAM 07 GUARD FILE. BY ORDER SENIOR PRIVATE SECRETARY ITAT VISAKHAPATNAM BENCH