Bhoomika Creative Dance Centre, New Delhi v. ITO (Hqrt) (E), New Delhi

ITA 3990/DEL/2009 | misc
Pronouncement Date: 06-08-2010 | Result: Allowed

Appeal Details

RSA Number 399020114 RSA 2009
Assessee PAN AADPJ4420C
Bench Delhi
Appeal Number ITA 3990/DEL/2009
Duration Of Justice 10 month(s) 7 day(s)
Appellant Bhoomika Creative Dance Centre, New Delhi
Respondent ITO (Hqrt) (E), New Delhi
Appeal Type Income Tax Appeal
Pronouncement Date 06-08-2010
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted A
Tribunal Order Date 06-08-2010
Date Of Final Hearing 02-08-2010
Next Hearing Date 02-08-2010
Assessment Year misc
Appeal Filed On 29-09-2009
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH `A : NEW DELHI BEFORE SHRI C.L. SETHI JUDICIAL MEMBER AND SHRI K.D. RANJAN ACCOUNTANT MEMBER I.T.A.NO.3990/DEL/2009 ASSESSMENT YEAR : N.A. BHOOMIKA CREATIVE DANCE CENTRE INCOME-TAX OFFIC ER (HQRS)(E) 53 BHARATI ARTISTS COLONY VS. DELHI. VIKAS MARG DELHI. PAN: AADPJ4420C (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI S . SRINIVASAN CA. RESPONDENT BY : MRS. BAN ITA DEVI NAOREM SR. DR. O R D E R PER C.L. SETHI JUDICIAL MEMBER. THE ASSESSEE IS IN APPEAL AGAINST THE ORDER UNDER S ECTION 80G(5)(VI) OF THE INCOME-TAX ACT 1961 READ WITH RULE 11AA OF THE INCOME-TAX RULES 1962 PASSED BY THE DIRECTOR OF INCOME-TAX (EXEMPTI ONS) DELHI REJECTING THE ASSESSEES APPLICATION FOR RENEWAL OF EXEMPTION SOUGHT FOR UNDER SECTION 80G(5) OF THE ACT. 2. THE ASSESSEE HAS TAKEN A GROUND THAT THE DIT(E) HAS ERRED IN REFUSING THE GRANT OF RENEWAL OF EXEMPTION UNDER SEC. 80G(5) OF THE ACT DESPITE COMPLETION OF THE NECESSARY FORMALITIES IN THAT REG ARD BY THE ASSESSEE. 3. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE M ATERIAL ON RECORD. 2 4. ON PERUSAL OF THE IMPUGNED ORDER PASSED UNDER SC . 80G(5)(VI) OF THE ACT REJECTING THE ASSESSEES APPLICATION FOR RENEW AL OF EXEMPTION WE FIND THAT THE DIT(E) HAS REJECTED THE ASSESSEES APPLICA TION BY OBSERVING THAT FROM THE ASSESSMENT YEAR 2009-10 THE ACTIVITIES OF THE ASSESSEE ARE NO LONGER CHARITABLE IN THE LIGHT OF THE DEFINITION OF THE TERM CHARITABLE PURPOSE DEFINED UNDER SEC. 2(15) OF THE ACT AS AME NDED BY THE FINANCE ACT 2008 WITH EFFECT FROM ASSESSMENT YEAR 2009-10 WHE REBY A PROVISO WAS INSERTED TO SEC. 2(15) OF THE ACT PROVIDING THAT T HE ADVANCEMENT OF ANY OTHER OBJECT OF GENERAL PUBLIC UTILITY SHALL NOT BE A CHA RITABLE PURPOSE IF IT INVOLVES THE CARRYING ON OF ANY ACTIVITY IN THE NATURE OF TR ADE COMMERCE OR BUSINESS OR ANY ACTIVITY OF RENDERING ANY SERVICE IN RELATIO N TO ANY TRADE COMMERCE OR BUSINESS FOR CESS OR FEE OR ANY OTHER CONSIDERATI ON IRRESPECTIVE OF THE NATURE OF USE OR APPLICATION OR RETENTION OF THE INCOME FROM SUCH ACTIVITY. THE LEARNED DIT(E) OBSERVED THAT THE ASSESSEE HAD R ECEIVED FEES OF RS.3 41 700/- RS.4 72 944/- AND RS.3 10 850/- FOR THE PERFORMANCE AND TRAINING OF ARTISTS DURING THE FINANCIAL YEARS 2005 -06 2006-07 AND 2007-08 WHICH GOES TO SHOW THAT THE ASSESSEE HAS BEEN ENGAG ED IN THE COMMERCIAL ACTIVITY BY RECEIVING FEES FOR GIVING PERFORMANCE A ND TRAINING IN ALL THE LAST THREE FINANCIAL YEARS. THE DIT(E) THEREFORE OBSER VED THAT FROM THE ASSESSMENT YEAR 2009-2010 IN THE LIGHT OF THE PROV ISO INSERTED BY FINANCE 3 ACT 2008 THE ACTIVITY OF THE ASSESSEE CAN NO LONG ER BE CONSIDERED TO BE OF CHARITABLE PURPOSE. THE DIRECTOR OF INCOME-TAX (EX EMPTIONS) THEREFORE REJECTED THE ASSESSEES APPLICATION. FROM THE SAID OBSERVATIONS OF THE DIT(E) IT IS CLEAR THAT THE DIT(E) HAS BASED HIS D ECISION ON THE FIGURES OF FINANCIAL YEARS 2005-06 2006-07 AND 2007-08 AND HA S NOT TAKEN INTO ACCOUNT THE FACT WHETHER THE ASSESSEE WAS ENGAGED I N THE COMMERCIAL ACTIVITY BY RECEIVING FEES FOR GIVING PERFORMANCE A ND TRAINING IN THE FINANCIAL YEAR 2008-09 RELEVANT TO THE ASSESSMENT Y EAR 2009-2010. IT IS NOT IN DISPUTE THAT THE PROVISO TO SEC. 2(15) IS ON LY APPLICABLE FROM ASSESSMENT YEAR 2009-2010 AND THEREFORE THE FACTS THAT WHETHER THE ASSESSEE WAS INVOLVED IN CARRYING ON OF ANY ACTIVIT Y IN THE NATURE OF TRADE COMMERCE OR BUSINESS OR ANY ACTIVITY OF RENDERING ANY SERVICE IN RELATION TO ANY TRADE COMMERCE OR BUSINESS FOR A CESS OR FEE OR ANY OTHER CONSIDERATION DURING F.Y. 2008-09 WAS REQUIRED TO BE EXAMINED AN D VERIFIED BEFORE DECIDING THAT ACTIVITY OF THE ASSESSEE IS NO LONGER OF CHARITABLE IN NATURE FROM ASSESSMENT YEAR 2009-2010. THIS ASPECT OF THE MATT ER HAS NOT BEEN LOOKED INTO AND EXAMINED BY THE DIT(E) NOR ANY DETAILS HAV E BEEN FURNISHED BY THE ASSESSEE BEFORE US. AT THIS STAGE IT IS ALSO PERT INENT TO NOTE THAT THE SECOND PROVISO HAS SINCE BEEN INSERTED TO SEC. 2(15) OF TH E ACT BY THE FINANCE ACT 2010 WITH EFFECT FROM 1.4.2009 WHEREBY IT HAS BEEN PROVIDED THAT THE FIRST 4 PROVISO WHICH WAS INSERTED BY THE FINANCE ACT 2008 WITH EFFECT FROM ASSESSMENT YEAR 2009-2010 SHALL NOT APPLY IF THE A GGREGATE VALUE OF THE RECEIPTS FROM THE ACTIVITIES REFERRED TO IN THE FIR ST PROVISO IS RS.10 00 000/- OR LESS IN THE PREVIOUS YEAR. THEREFORE EVEN IF T HE ASSESSEE WAS INVOLVED IN CARRYING ON OF ANY ACTIVITY IN THE NATURE OF TRADE COMMERCE OR BUSINESS OR ANY ACTIVITY OF RENDERING ANY SERVICE IN RELATION T O ANY TRADE COMMERCE OR BUSINESS FOR A CESS OR FEE OR ANY OTHER CONSIDERAT ION THE FIRST PROVISO WOULD NOT BE APPLICABLE TO THAT ASSESSEES CASE WHERE THE TOTAL VALUE OF RECEIPT DOES NOT EXCEED RS.10 LAKH. IN THE PRESENT CASE IN SO F AR AS FINANCIAL YEARS 2005- 06 TO 2007-08 ARE CONCERNED THE RECEIPTS RECEIVED BY THE ASSESSEE FROM GIVING PERFORMANCE AND TRAINING IS UNDOUBTEDLY BEL OW RS.10 LAKH. THEREFORE IN THE LIGHT OF SUBSEQUENT AMENDMENT BRO UGHT BY THE FINANCE ACT 2010 WITH EFFECT FROM 1.4.2009 THE ISSUE NEED S A FURTHER EXAMINATION AND ADJUDICATION. 5. IN THE LIGHT OF THE DISCUSSIONS MADE ABOVE WE T HEREFORE RESTORE THE MATTER BACK TO THE FILE OF THE DIRECTOR OF INCOME-T AX (EXEMPTIONS) FOR HIS FRESH ADJUDICATION AFTER EXAMINING ALL THE EVIDENCE S AND MATERIAL FOR DECIDING THE ASSESSEES APPLICATION FOR RENEWAL OF EXEMPTION UNDER SEC. 80G(5) OF THE ACT. THE ASSESSEE SHALL SUBMIT BEFOR E THE DIT(E) ALL THE DETAILS OF ITS ACTIVITIES CARRIED OUT UPTO THE END OF THE F.Y. 2009-2010 OR 5 EVEN UPTO THE DATE OF HEARING IN ORDER TO ENABLE TH E DIT(E) TO DECIDE THE MATTER IN ITS RIGHT AND CORRECT PERSPECTIVE. WE DI RECT THE ASSESSEE TO COOPERATE WITH THE DIT(E) BY SUBMITTING ALL THE DET AILS AND PARTICIPATING IN THE PROCEEDINGS FOR PERSONAL HEARING BEFORE HIM. W E ORDER ACCORDINGLY. 6. IN THE RESULT THIS APPEAL FILED BY THE ASSESSEE IS TREATED TO BE ALLOWED FOR STATISTICAL PURPOSES. 7. THIS DECISION WAS PRONOUNCED IN THE OPEN COURT O N 2 ND AUGUST 2010 IMMEDIATELY AFTER THE HEARING WAS OVER. SD/- SD/- (K.D. RANJAN) (C.L. SETHI) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 2 ND AUGUST 2010. COPY OF THE ORDER FORWARDED TO:- 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR BY ORDER *MG DEPUTY REGISTRAR ITAT.