Gowda Saraswath Sevak Samaj, Bangalore v. DIT, Bangalore

ITA 819/BANG/2014 | misc
Pronouncement Date: 19-10-2016 | Result: Dismissed

Appeal Details

RSA Number 81921114 RSA 2014
Bench Bangalore
Appeal Number ITA 819/BANG/2014
Duration Of Justice 2 year(s) 4 month(s)
Appellant Gowda Saraswath Sevak Samaj, Bangalore
Respondent DIT, Bangalore
Appeal Type Income Tax Appeal
Pronouncement Date 19-10-2016
Appeal Filed By Assessee
Order Result Dismissed
Bench Allotted B
Tribunal Order Date 19-10-2016
Date Of Final Hearing 22-09-2016
Next Hearing Date 22-09-2016
Assessment Year misc
Appeal Filed On 19-06-2014
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL BANGALORE BENCH B BEFORE S HRI VIJAY PAL RAO JUDICIAL MEMBER AND SHRI S. JAYARAMAN ACCOUNTANT MEMBER I.T . A. NO. 819 /BANG/20 14 GOWDA SARASWATH SEVAK SAMAJ NO.8 CHIRAPUR BHAVAN 8 TH MAIN 15 TH CROSS MALL ESHWARAM BANGALORE - 560 003 . . APPELLANT. VS. DIRECTOR OF INCOME TAX (EXEMPTION) BANGALORE. .. RESPONDENT. APPELLANT BY : SHRI R . CHANDRASHEKAR ADVOCATE. R E SPONDENT BY : SMT. JAHANZEB AKHTAR CIT (D.R) DATE OF H EARING : 22.9.2016. DATE OF P RONOUNCEMENT : 19 .10 .201 6 . O R D E R PER SHRI VIJAY P AL RAO J .M . : THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER DT.28.5.2014 PASSED BY DIRECTOR OF INCOME TAX (EXEMPTION) UNDER SECTION 12AA OF THE INCOME TAX ACT 1961 (IN SHORT 'THE ACT') WHEREBY THE APPL ICATION OF THE ASSESSEE FOR REGISTRATION UNDER SECTION 12AA WAS REJECTED. 2 IT A NO. 819 /BANG/201 4 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS : 3. THE LD. AR OF THE ASSESSEE HAS SUBMITTED THAT THE DIT(EXEMPTION) HAS REJECTED THE APPLICATION OF THE ASSESSEE ON T HE GROUND THAT THE ASSESSEE - TRUST IS CREATED TO CATER THE NEEDS OF ONLY ONE COMMUNITY OF THE SOCIETY THEREFORE NEITHER ITS MEMBERSHIP NOR ITS BENEFITS ARE 3 IT A NO. 819 /BANG/201 4 AVAILABLE TO THE PUBLIC AND HENCE IT WAS HELD THAT THE OBJECTS OF THE TRUST ARE NOT CHARITABLE IN NA TURE. THE LEARNED AUTHORISED REPRESENTATIVE HAS REFERRED TO THE OBJECTS OF THE ASSESSEE - TRUST AND SUBMITTED THAT EVEN IF THE OBJECTS OF THE TRUST ARE FOR ADVANCEMENT AND BENEFIT/WELFARE OF A PARTICULAR COMMUNITY IT CANNOT BE SAID THAT IT IS NOT FOR GENER AL PUBLIC UTILITY. IN SUPPORT OF HIS CONTENTION HE HAS RELIED UPON THE DECISION OF HON'BLE JURISDICTIONAL HIGH COURT DT.23.2.2016 IN THE CASE OF BANGALORE URBAN AND RURAL DISTRICT CO - OPERATIVE MILK PRODUCERS SOCIETIES MEMBERS & EMPLOYEES WELFARE TRUST B ANGALORE MILK UNION LTD. VS. DIT(EXEMPTION) IN ITA NOS.7 - 8/2010 AND SUBMITTED THAT HON'BLE HIGH COURT HAS HELD THAT THE PHRASE ANY OTHER OBJECT OF GENERAL PUBLIC UTILITY IS NOT NECESSARILY THAT THE OBJECT SHOULD BENEFIT WHOLE MANKIND OR PERSONS IN A CO UNTRY OR STATE. IF IT IS TO THE BENEFIT OF SECTION OF PUBLIC IT IS TO BE CONSTRUED AS CHARITABLE PURPOSE. THE LEARNED AUTHORISED REPRESENTATIVE HAS THEN RELIED UPON THE DECISION DT.30.1.2015 OF PUNE BENCH OF THIS TRIBUNAL IN THE CASE OF KUL FOUNDATION VS . CIT IN ITA NO.1692/P N /2013 AND SUBMITTED TH A T THE TRIBUNAL HAS HELD THAT MERELY BECAUSE ONE OF THE OBJECT OF THE TRUST WAS FOR THE BENEFIT O R UPLIFTMENT 4 IT A NO. 819 /BANG/201 4 OF JAIN COMMUNITY WOULD NOT DENY THE GRANT OF REGISTRATION UNDER SECTION 12AA OF THE ACT. THUS THE LEARNED AUTHORISED REPRESENTATIVE HAS SUBMITTED THAT THE OBJECTS OF THE ASSESSEE - TRUST FOR THE BENEFIT AND ADVANCEMENT OF A SECTION OF PUBLIC AS HELD BY THE HON'BLE JURISDICTIONAL HIGH COURT AS WELL AS BY HON'BLE SUPREME COURT IN THE CASE OF AHMEDABAD RAN A CASTE ASSOCIATION V. CIT [1971] 82 ITR 704 (SC) WOULD BE IN THE NATURE OF CHARITABLE. 4. ON THE OTHER HAND THE LEARNED DEPARTMENTAL REPRESENTATIVE HAS SUBMITTED THAT THE DECISIONS RELIED UPON BY THE LD. AR ARE NOT APPLICABLE TO THE FACTS OF THE ASSE SSEE'S CASE AS THE WHOLE OBJECTS OF THE ASSESSEE - TRUST ARE FOR THE BENEFIT OF A PARTICULAR COMMUNITY/CASTE AND THEREFORE THE SAME CANNOT BE SAID TO BE THE OBJECTS OF GENERAL PUBLIC UTILITY TO SERVE A CHARITABLE PURPOSE. HE HAS RELIED UPON THE IMPUGNED ORD ER OF THE DIT(EXEMPTION). 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AS WELL AS THE RELEVANT MATERIAL ON RECORD. AS REGARDS THE DECISIONS RELIED UPON BY THE LD AR OF THE ASSESSEE WE FIND THAT IT IS SETTLED POSITION OF LAW THAT IF THE PRIMARY PURP OSE AND PREDOMINANT OBJECTS OF THE TRUST ARE TO PROMOTE THE 5 IT A NO. 819 /BANG/201 4 WELFARE OF THE GENERAL PUBLIC THE PURPOSE WOULD BE CHARITABLE IN NATURE EVEN IF SOME SECONDARY OR ANCILLARY OBJECTS ARE FOR THE BENEFIT OF A PARTICULAR COMMUNITY OR CLASS OF PUBLIC . I F THE PRIMA RY OR PREDOMINANT OBJECTS OF INSTITUTION IS CHARITABLE THEN ANY OTHER OBJECT WHICH MIGHT NOT BE CHARITABLE BUT ARE ANCILLARY OR INCIDENTAL TO THE DOMINANT PURPOSE WOULD NOT CHANGE THE NATURE OF CHARITABLE TRUST. THEREFORE ONLY AN ANCILLARY AND INCIDENTAL OBJECT WOULD NOT BE SUFFICIENT TO CONCLUDE THAT THE ENTIRE PURPOSE AND ACTIVITY OF THE TRUST WOULD NOT BE CHARITABLE. IN CASE OF THE ASSESSEE - TRUST THE OBJECTS ARE REPRODUCED BY THE DIT(EXEMPTION) IN THE IMPUGNED ORDER AS UNDER : 6 IT A NO. 819 /BANG/201 4 IMPARTING EDUCATION OR PROVIDING WELFARE TO THE MASSES WOULD QUALI F Y AS CHARITABLE PURPOSE AS PER SECTION 2(15) OF THE ACT . H OWEVER THE OBJECTS OF THE ASSESSEE - TRUST REVEALS THE INTENT OF THE TRUST AND THEREFORE THE WHOLE PURPOS E CONTEMPLATED IN THE OBJECTS OF THE CREATION AND EXISTENCE OF THE TRUST IS FOR A PARTICULAR COMMUNITY/CASTE. IT DOES NOT REFER TO ANY WELFARE OR OTHER SERVICE OR HELP TO THE POOR OR NEED OF THE PARTICULAR COMMUNITY BUT IT IS ONLY FOR A PARTICULAR COMMUNITY WITHOUT DISTINGUISHING THE NEEDY AND POOR EVEN WITHIN THIS SAID COMMUNITY. THEREFORE THE ELEMENT OF CHARITY IS COMPLETELY MISSING IN THE OBJECTS OF THE ASSESSEE - TRUST. A COMMUNITY OR A PARTICULAR CASTE CANNOT BE EQUATED WITH A SECTION OF GENERAL PUBLIC REPRESENTING OR TRACING THEIR ROOTS FROM GENERAL MASSES WITHOUT DISTINGUISHING THEIR IDENTITY BASED ON CAST E OR COMMUNITY. A SECTION OF THE GENERAL PUBLIC IDENTIF IED ON THE BASIS OF THEIR OCCUPATION OR PROFESSION DO NOT REPRESENT ANY PARTICULAR COMMUNITY OR CASTE BUT COMPRISING ITS MEMBERS FROM GENERAL PUBLIC AND MASSES . T HEREFORE THE DECISIONS RELIED UPON BY THE LD. AR WOULD NOT HELP THE CASE OF THE ASSESSEE WHEN THE ENTIRE OBJECTS AND PURPOSE OF THE ASSESSEE - TRUST IS ABSOLUTELY FOR A PARTICULAR CASTE WHICH CANNOT BE TREATED 7 IT A NO. 819 /BANG/201 4 AS GENERAL PUBLIC OR A SECTION OF GENERAL PUBLIC. HENCE THE ASSESSEE - TRUST WOULD NOT QUALIFY AS CHARITABLE TRUST AS PER THE PROVISIONS OF SECTION 2(15) OF THE ACT. IN VIEW OF THE ABOVE FACTS AND CIRCUMSTANCES OF THE CASE WE DO NOT FIND ANY ERROR OR ILLEGALITY IN THE IMP UGNED ORDER OF THE DIT(EXEMPTION). 6. IN THE RESULT THE APPEAL OF THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THE 19TH DAY OF OCT. 201 6 . SD/ - ( S. JAYARAMAN ) ACCOUNT ANT MEMBER SD/ - ( VIJAY PAL RAO ) JUDICIAL MEMBER BANGALORE DT. 19 . 10.2016. *REDDY GP COPY TO : 1. APPELLANT 2. RESPONDENT 3. C.I.T. 4. CIT(A) 5. DR ITAT BANGALORE. 6. GUARD FILE. BY ORDER ASST. REGISTRAR ITAT BANGALORE