Income Tax Appellate Tribunal - Ahmedabad
Bio Diversity Conservation And Rular ... vs Assessee on 19 July, 2016
IN THE INCOME TAX APPELLATE TRIBUNAL
AHMEDABAD '' C " BENCH - AHMEDABAD
Before Shri R. P. Tolani, JM, & Shri Manish Borad, AM.
ITA No.975 /Ahd/2013
Asst. Year:
Bio Diversity Conservation & Vs. Director Income-tax
Rural Livelihood Improvement Exemption, Ahmedabad.
Projects Society(BCRLIP), c/o
Dy. Conservator of Forest,
Wild Ass Century Mayumagar,
Halvad Road, Dharangadhra
Appellant Respondent
PAN AABTB8489M
Appellant by Shri M. K. Patel, AR
Respondent by Smt. Vibha Bhalla, CIT,DR
Date of hearing: 18/07/2016
Date of pronouncement: 19/7/2016
ORDER
PER Manish Borad, Accountant Member.
Assessee is in appeal against the order of Director of Income- tax (Exemption), Ahmedabad, dated 31.01.2013 passed u/s 12AA of the I.T. Act, 1961 (in short the Act). Solitary ground of appeal raised by assessee reads as under :-
1. The Hon'ble director Income Tax has erred in law by stating that assessee trust is not got dissolution clause therefore it is not a genuine trust though the assessee trust is a government Trust and duly registered with Charity Commissioner under public Trust Act 1950. The assessee pray that its trust should be Registered u/'s 12AA of the Income Tax Act.ITA No. 975/Ahd/2013 2
Asst. Year -
2. Brief facts of the case are that the Assessee Trust is a Government Trust supported by Government grants sharing office with Dy. Conservator of Forest Officer, Dhrangadhra and the building premises belongs to Governent of Gujarat. Application for grant of Registration of the Trust u/s 12AA of the Act was received by Director of Income-tax (Exemption) on 23.8.2012 accompanied by copy of Certificate of Registration of Assistant Charity Commissioner, copy of PAN and copy of trust deed. During the course of verification of the related documents more specifically the trust deed, it was noticed by ld. DIT (Exemption) that the trust deed does not have any clause that the trust will not be dissolved and it is perpetual, because as per Bombay Public Trust Act it is settled position of law that the trust is a perpetual trust and in case the activities of the trust cannot be carried out the asset(s) have to be transferred to another trust carrying on similar activities with the sanction of Charity Commissioner. As no such clause was there in the trust deed, ld. DIT denied the approval of the trust.
3. Aggrieved, assessee is now in appeal before the Tribunal.
4. Ld. AR submitted that all necessary documents including memorandum of association as well as submissions of a letter mentioning therein that assessee is a Govt. Trust running its office belong to the Govt. of Gujarat. Ld. AR further submitted that assessee trust runs purely on Government grant(s) and purely for implementing the Govt. Schemes. Therefore, the power to function the trust is with the Government and in case of dissolution or ITA No. 975/Ahd/2013 3 Asst. Year -
suspension of activities the asset(s) will be automatically vested with the Government and, therefore, ld. DIT (Exemption) erred in denying exemption u/s 12AA of the Act only on the basis that the trust deed does not have any clause about the trust being perpetual and will not be dissolved. The assessee relied on the order of the Co-ordinate Bench in the case of Shree Chargam Dasha Porwad Mahamandal vs. DCIT in ITA No.337 & 338/Ahd/2013 pronounced on 8/5/2013.
5. On the other hand, ld. DR supported the order of lower authority.
6. We have heard the rival contentions and perused the material on record. The assessee is in appeal before us against the action of ld. DIT(Exemption), Ahmedabad for denying the approval u/s 12AA of the Act by observing as under :-
3. On verification of reply and records of the "Assessee" it is seen that there is no dissolution clause in the trust deed. Further it is also noticed that trust does not have any clause that the trust will not be dissolved and it is perpetual. As per the Bombay Public Trust Act and settled position of law, a trust is a perpetual trust. In case the activities of the trust cannot be carried out, the same, with the sanction of Charity Commissioner and as per the procedure of the Bombay Public Trust Act, the assets etc. have to be transferred to another trust carrying on similar activity No such clause is there in the Deed and therefore, the approval is denied.
7. We further observe that assessee trust namely Bio Diversity Conservation & Rural Livelihood Improvement Projects Society is a Government trust supported by government grants and running its ITA No. 975/Ahd/2013 4 Asst. Year -
office in the government premises along with Dy. Conservator of Forest's Office, Dharangadhra. We further observe that assessee trust's main object is to strengthen and mainstream biodiversity conservation at the Little Rann of Kutch landscape level by improving rural livelihoods, learning and its replicating through participatory approaches, reduce man-animal conflicts etc. and implementing government scheme as per the directions of the Government officials. Overall power to function the trust is ultimately with the Government and, therefore, in case of dissolution of the Society, asset(s), if any, will remain with the Government itself.
8. We therefore, are of the view that looking to the type of assessee which is a government aided and government supported trust which is exclusively running to achieve the objects as per the directions of the government and even the Executive Committee of the Society comprises of all the Government officials ranging from Chief Conservator of Forest, Director of Department of Agriculture, Animal Husbandry, Fisheries along with Conservator, Dy. Conservator of Forests are enough to show that assessee trust is purely government trust. Certainly the asset(s), if any, will be under the direct control of the Government and, therefore, there is a deemed clause which even if not specifically mentioned in the Trust Deed, that the assessee trust will be a perpetual trust and in case of dissolution, the asset(s) will be owned by Government only and, therefore, with this observation we set aside the issue to the file of ld. DIT (Exemption) for granting approval u/s 12AA of the Act to the assessee trust. The ground raised by the assessee is allowed.
ITA No. 975/Ahd/2013 5Asst. Year -
9. In the result, the appeal of assessee is allowed.
Order pronounced in the open Court on 19th July, 2016 Sd/- sd/-
(R. P. Tolani) (Manish Borad)
Judicial Member Accountant Member
Dated 19 /7/2016
Mahata/-
Copy of the order forwarded to:
1. The Appellant
2. The Respondent
3. The CIT concerned
4. The CIT(A) concerned
5. The DR, ITAT, Ahmedabad
6. Guard File
BY ORDER
Asst. Registrar, ITAT, Ahmedabad
1. Date of dictation: 18/07/2016
2. Date on which the typed draft is placed before the Dictating Member: 19/07/2016 other Member:
3. Date on which approved draft comes to the Sr. P. S./P.S.:
4. Date on which the fair order is placed before the Dictating Member for pronouncement: __________
5. Date on which the fair order comes back to the Sr. P.S./P.S.:
6. Date on which the file goes to the Bench Clerk: 19/7/16
7. Date on which the file goes to the Head Clerk:
8. The date on which the file goes to the Assistant Registrar for signature on the order:
9. Date of Despatch of the Order: