The Biblio Charitable Trust,, New Delhi v. DIT (E), Delhi

ITA 4258/DEL/2009 | misc
Pronouncement Date: 31-03-2010 | Result: Allowed

Appeal Details

RSA Number 425820114 RSA 2009
Assessee PAN TOTAL8000C
Bench Delhi
Appeal Number ITA 4258/DEL/2009
Duration Of Justice 4 month(s) 26 day(s)
Appellant The Biblio Charitable Trust,, New Delhi
Respondent DIT (E), Delhi
Appeal Type Income Tax Appeal
Pronouncement Date 31-03-2010
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted A
Tribunal Order Date 31-03-2010
Date Of Final Hearing 18-02-2010
Next Hearing Date 18-02-2010
Assessment Year misc
Appeal Filed On 04-11-2009
Judgment Text
I.T.A.4258 NO. /DEL/09 1/5 IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH A NEW DELHI) BEFORE SHRI R.P. TOLANI JUDICIAL MEMBER AND SHRI A.K. GARODIA ACCOUNTANT MEMBER I.T.A. NO.4258 /DEL/2009 M/S BIBLIO CHARITABLE TRUST DIT (E) 2204 SECTOR-D-2 PLOT NO.15 3 RD FLOOR VASANT KUNJ NEW DELHI. V. LAXMI NAGAR DISTT. CEN TRE NEW DELHI. (APPELLANT) (RESPONDENT) PAN /GIR/NO.AAATT-3103-D APPELLANT BY : SHRI VIRENDER TALWAR C.A. RESPONDENT BY : MS. BANITA DEVI NAOREM SR. DR ORDER PER A.K. GARODIA AM: THIS IS AN ASSESSEE'S APPEAL DIRECTED AGAINST THE O RDER OF DIT (E) NEW DELHI PASSED BY HIM U/S 80G(5)9VI) OF THE INCOME TA X ACT 1961 ON 3 RD SEPTEMBER 2009. 2. THE GROUND RAISED BY THE ASSESSEE READS AS UNDER - 1. THE LD DIRECTOR OF INCOME TAX (EXEMPTION) HAS WR ONGFULLY REJECTED APPLICATION OF ASSESSEE U/S 80G ON THE BASIS THAT T HETRUST COULD NOT ESTABLISHED THAT IT CONTINUES TO SATISFY CONDITIONS LAID OUT U/S 80G(5) IN VIEW OF AMENDED PROVISIONS OF SECTION 2(15) EVEN WH EN THE TRUST IS SATISFYING CONDITIONS AND IS NOT DEBARRED UNDER THE AMENDED PROVISIONS OF SECTION 2(15) OF THE ACT FOR GRANT OF EXEMPTION. . I.T.A. NO.4258/DEL/09 2/5 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE H AS FILED AN APPLICATION ON 30 TH MARCH 2009 IN FORM NO.10G SEEKING RENEWAL OF EXEM PTION U/S 80G OF THE INCOME TAX ACT 1961. THE ASSESSEE IS A TRUST DULY REGISTERED U/S 12 OF THE IT ACT AS PER REGISTRATION CERTIFICATE DATED 27.10.199 8 AVAILABLE ON PAGE NO./33 OF THE PAPER BOOK. THE ASSESSEE WAS GRANTED REGISTRAT ION U/S 80G(5)(VI) FROM TIME TO TIME. IN THE ASSESSMENT ORDER FOR ASSESSMENT YE AR 2004-05 SUBMITTED BY THE ASSESSEE IT HAS BEEN NOTED BY THE ASSESSING OFFICE R THAT THE ASSESSEE HAS BEEN ALLOWED BENEFIT U/S 80G(5)(VI) VIDE ORDER DATE D 26.2.2002 HAVING VALIDITY FROM 1.4.2001 TO 31.3.2004. AS PER ORDER PASSED BY LD DIT (E) DELHI ON 20 TH SEPTEMBER 2006 COPY OF WHICH IS AVAILABLE ON PAGE NO.36 OF THE PAPER BOOK EXEMPTION WAS ALLOWED BY THE DIT (E) TO THE ASSESSE E U/S 80G(5)(VI) OF THE ACT FOR THE PERIOD FROM1.4.2006 TO 31.3.2009. IT WAS S UBMITTED BY THE ASSESSEE BEFORE US THAT THE ASSESSEE WAS ALLOWED REGISTRATIO N U/S 80G THROUGH OUT UPTO 31.3.2009 AND FOR THE FIRST TIME SUCH REGISTRATION U/S 80G(5)(VI) HAS BEEN REJECTED WHEN APPLICATION WAS MADE BY THE ASSESSEE FOR ITS RENEWAL FROM 1.4.2009. IT IS SUBMITTED THAT THE ACTIVITIES OF T HE TRUST WERE THE SAME ALL THROUGH OUT AND HENCE THE ORDER OF LD DIT(E) IS NOT JUSTIFI ED IN REJECTING THE APPLICATION OF THE ASSESSEE FOR RENEWAL OF REGISTRATION U/S 80G OF THE INCOME TAX ACT 1961 FROM 1.4.2009. 5. AS AGAINST THIS LD DR OF THE REVENUE SUPPORTED THE ORDER OF THE LD DIT(E) DELHI. 6. WE HAVE HEARD THE RIVAL SUBMISSIONS AND HAVE GON E THROUGH THE MATERIAL AVAILABLE ON RECORD AND THE ORDER PASSED BY LD DIT (E) DELHI U/S 80G(5)(VI) OF THE ACT. WE FIND THAT THE ASSESSEE WAS GRANTED REGI STRATION U/S 12A VIDE ORDER DATED 27.10.1998 W.E.F. 29.4.1998 I.E. THE DATE WHE N THE TRUST WAS CONSTITUTED. A COPY OF THIS ORDER OF REGISTRATION U/S 12A IS AVAIL ABLE ON PAGE NO.33 OF THE PAPER BOOK. THEREAFTER THE ASSESSEE WAS ALLOWED REGISTRA TION U/S 80G(5)(VI) OF THE ACT. THE LATEST RENEWAL OF REGISTRATION WAS ALLOWED AS P ER ORDER DATED 20 TH SEPTEMBER 2006 FOR THE PERIOD FROM 1.4.2006 TO 31. 3.2009. COPY OF THIS ORDER IS . I.T.A. NO.4258/DEL/09 3/5 AVAILABLE ON PAGE NO.34 OF THE PAPER BOOK. IN THE ASSESSMENT ORDER FOR ASSESSMENT YEAR 2002-03 IT HAS BEEN NOTED BY THE ASSESSING OFFICER THAT THE ASSESSEE WAS ALLOWED BENEFIT U/S 80G(5)(VI) VIDE OR DER DATED 26.2.2002 HAVING VALIDITY FROM 1.4.2001 TO 31.3.2004. IT WAS A SUBM ISSION OF THE LD AR OF THE ASSESSEE BEFORE US THAT TILL 31.3.2009 THE ASSESSE E WAS ALLOWED REGISTRATION U/S 80G(5)(VI) OF THE ACT THROUGH OUT AND WE HAVE NO RE ASON TO DOUBT THIS CONTENTION IN THE LIGHT OF THE RENEWAL GRANTED BY THE DIT (E) DELHI FOR THE PERIOD FROM 1.4.2006 TO 31.3.2009. IN THE IMPUGNED ORDER LD D IT (E) HAD REJECTED THE CLAIM OF THE ASSESSEE FOR RENEWAL OF EXEMPTION U/S 80G ON THE BASIS THAT THE ASSESSEE TRUST DOES NOT QUALIFY AS A TRUST FOR CHARITABLE TR UST BECAUSE IT IS CARRYING OUT AN ACTIVITY OF THE NATURE OF BUSINESS FOR CONSIDERATIO N I.E. SALE OF PUBLICATION GENERATING COMMERCIAL PROFITS IN THE FORM OF ADVERT ISEMENTS SPONSORSHIP SUBSCRIPTION AND PUBLICATION RECEIPTS. IN THIS REG ARD WE FIND THAT THE ASSESSEE TRUST IS IN FACT RECOVERING SOME PART OF EXPENSES I NCURRED BY IT ON PUBLICATION OF MAGAZINE BIBLIO BUT IN SPITE OF THAT THERE IS NO SURPLUS. AS PER INCOME & EXPENDITURE ACCOUNT FOR THE YEAR ENDING ON 31.3.200 6 THERE IS RECEIPT OF RS.11.13 LAKHS ON ACCOUNT OF SALE OF PUBLICATION S UBSCRIPTION RECEIVED ADVERTISEMENT RECEIPTS SPONSORSHIP/DONATION GRANTS AVAILED BUT THERE ARE EXPENSES OF RS.20.75 LAKHS ON ACCOUNT OF PUBLICATIO N OF THIS MAGAZINE MAINLY. SIMILARLY FOR THE YEAR ENDED ON 31.3.2007 THERE A RE EXPENSES OF RS.17.83 LAKHS AS AGAINST INCOME OF RS.13 93 LAKHS. FOR HE YEAR EN DED ON 31.3.2008 EXPENSES ARE OF RS.17.47 LAKHS WHEREAS THE INCOME IS ONLY OF RS.13.26 LAKHS AND THERE IS DEFICIT IN THIS YEAR ALSO. NOW THE QUESTION IS WHE THER ONLY FOR THIS REASON THAT THERE IS SOME REALIZATION BY THE ASSESSEE ON ACCOUN T OF SALE OF THIS MAGAZINE IT CAN BE SAID THAT THE ASSESSEE TRUST IS NOT A CHARIT ABLE TRUST. AS PER THE DETAILS OF BIO MONTHLY PUBLICATION DURING THE FINANCIAL YEAR 2 008-09 IT IS SUBMITTED BEFORE US ON PAGE NO.6 OF THE PAPER BOOK THAT TOTAL 8000 C OPIES WERE PRINTED DURING THIS YEAR OUT OF WHICH 2169 COPIES WERE FREE DISTRIBUTI ON AND ONLY 5458 COPIES WERE SOLD AGAINST SUCH SUBSCRIPTION/SALES AND BALANCE 37 3 COPIES WERE AVAILABLE IN THE OFFICE OF THE ASSESSEE TRUST. AS PER COPIES AV AILABLE ON PAGE NO.7-12 OF THE PAPER BOOK WE FIND THAT IT INCLUDES FREEDOM FIGHTE R ASSOCIATION VIJAYWADA . I.T.A. NO.4258/DEL/09 4/5 COUNCIL FOR RESEARCH AND EDUCATION FOR SOCIAL TRANS FORMATION (CREST) KERALA TATA INSTITUTE OF SOCIAL SCIENCES TEJPUR UNIVERSIT Y UNIVERSITY OF DELHI IGNOU NEW DELHI ETC. AS PER THE NOTES ON ACTIVITIES OF T HE ASSESSEE TRUST AVAILABLE ON PAGE NO.4 OF THE PAPER BOOK MAGAZINE BIBLIO PUBL ISHED BY THE ASSESSEE TRUST PROVIDES BRIDGE BETWEEN THE TWO GOVTS. AND GENERAL READING PUBLIC. THE PURPOSE OF THIS MAGAZINE IS STATED TO BE TO ENCOURA GE THE READING HABIT IF THEY DO NOT FIND SPACE IN THE MAIN STREAM OF MEDIA. THE ASS ESSEE TRUST HAS A WEB SITE ALSO FOR THIS MAGAZINE I.E. BIBLIO WEB SITE WHICH W AS LAUNCHED IN 2001. IT HAS BEEN SUBMITTED BEFORE US THAT THIS SITE HAS 6224 RE GISTERED USERS UPTO JUNE 2009 50% OF WHOM ARE OF ACADEMIC AND STUDENTS. IT IS ALSO POINTED OUT BEFORE US THAT ON AN AVERAGE 70% OF CONTENTS OF EACH ISSUE OF THIS MAGAZINE BIBLIO IS FREE TO ACCESS ON THIS WEB SITE. CONSIDERING ALL TH E FACTS OF THE PRESENT CASE WE FEEL THAT THIS IS NOT A VALID BASIS TO REJECT THE P RINCIPLES OF THE ASSESSEE FOR REGISTRATION U/S 80G(5)9VI) OF THEACT. OUR THIS VIE W IS SUPPORTED BY THE JUDGMENT OF HON'BLE PUNJAB & HARYANA HIGH COURT RENDERED IN THE CASE OF SONEPAT HINDU EDUCATIONAL AND CHARITABLE SOCIETY V . CIT AS REPOR TED IN 278 ITR 262 WHEREIN IT WAS HELD THAT IN CONSIDERING THE PURPOSE OF THE TRU ST FOR THE PURPOSE OF APPROVAL U/S 80G OF THE INCOME TAX ACT 1961 IT IS IMPORTAN T TO FIND OUT THE REAL PURPOSE OF ESTABLISHING THE TRUST RATHER THAN RELYING ON TH E OBJECTS MEMORANDUM AND ARTICLES OF THE TRUST DEED OF THE TRUST. IT WAS ALS O HELD THAT IF THE COMMISSIONER IS JUSTIFIED THAT THE OBJECTS OF THE TRUST ARE CHARITA BLE APPROVAL SHOULD NOT BE DENIED ON MERE TECHNICALITIES. IT WAS ALSO HELD THAT REGIS TRATION OF AN INSTITUTION U/S 12A OF THE ACT IS SUFFICIENT PROOF OF IT BEING ESTABLIS HED FOR CHARITABLE PURPOSES. IN THE PRESENT CASE ALSO THIS IS NOT IN DISPUTE THAT THE ASSESSEE HAS BEEN GRANTED REGISTRATION U/S 12A AND SUCH REGISTRATION IS VALID . TILL 31.3.2009 THE ASSESSEE WAS ALLOWED REGISTRATION U/S 80G(5)9VI) ALSO AND IN THAT PERIOD ALSO THE ACTIVITIES OF THE ASSESSEE TRUST WERE SAME AND CONSIDERING ALL THESE FACTS WE ARE OF THE CONSIDERED OPINION THAT IN THE LIGHT OF THIS JUDGME NT ALSO REJECTING THE APPLICATION OF THE ASSESSEE FOR RENEWAL OF REGISTRATION U/S 80G (5)(VI) IS NOT JUSTIFIED. WE THEREFORE DIRECT THE LD DIT (E) DELHI TO GRANT TH E REGISTRATION U/S 80G(5)(VI) AS APPLIED FOR BY THE ASSESSEE . I.T.A. NO.4258/DEL/09 5/5 7. IN THE RESULT THE APPEAL OF THE ASSESSEE IS ALL OWED. 8. ORDER PRONOUNCED IN THE OPEN COURT ON 31ST MARC H 2010. SD/- SD/- (R.P. TOLANI) (A.K. GAR ODIA) JUDICIAL MEMBER ACCOUNTANT MEMBER DT. 31.3.2010. HMS COPY FORWARDED TO:- 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT (A)- NEW DELHI. 5. THE DR ITAT LOKNAYAK BHAWAN KHAN MARKET NEW DELHI. TRUE COPY. BY ORDER (ITAT NEW DELHI).