Income Tax Appellate Tribunal - Rajkot
Mataji Kankeshwari Temple Trust,, ... vs Commr. Of Income Tax(Osd) ... on 24 April, 2017
IN THE INCOME TAX APPELLATE TRIBUNAL
RAJKOT BENCH, RAJKOT
[Conducted through E-Court at Ahmedabad]
BEFORE SHRI MAHAVIR PRASAD, JUDICIAL MEMBER And
SHRI, MANISH BORAD, ACCOUNTANT MEMBER
आयकर अपील सं./I.T.A. No.263/Rjt/2015
Shri Mataji Kankeshwari बनाम/ Principal
Temple Trust Vs. Commissioner of
Kankai (GIR), Income Tax
Via: Visavadar, (OSD)(Exemptions),
Post-Prempara - 362160, Ahmedabad
Dist: Junagadh
थायी ले खा सं . /जीआइआर सं . / PAN/GIR No. : AAATS 7916 D
(अपीलाथ /Appellant) .. ( यथ / Respondent)
अपीलाथ ओर से /Appellant by : Shri M.J. Ranpura, AR
यथ क ओर से/Respondent by : Shri Yogesh Pandey, CIT
D.R.
ु वाई क तार ख /
सन Date of Hearing 20/04/2017
घोषणा क तार ख /Date of Pronounce ment 24/04/2017
आदे श / O R D E R
PER SHRI MAHAVIR PRASAD, JUDICIAL MEMBER :
This appeal has been preferred by the assessee is directed against the order of the Principal Commissioner of Income Tax(OSD)(Exemptions)-Ahmedabad, dated 19/03/2015.
2. Assessee has been taken following Grounds of appeals:
(i). The learned Principal Commissioner of Income Tax (OSD) (Exemption), Ahmedabad [hereinafter referred to as the "PCIT"] has erred on facts and also in law in rejecting appellant's ITA No.263/Rjt/2015 Shri Mataji Kankeshwari Temple Trust vs. PCIT -2- application u/s.80G(5) of the of the Income-tax Act, 1961 [hereinafter referred to as the "Act"] by alleging that;
• The objects of the trust are purely religious in nature. • The appellant trust incurred expenditure on religious purpose more than prescribed limit i.e. 5% which is in violation of provision of section 80G(5B).
• The appellant trust has not produced the copy of registration u/s.12AA of the Act.
(ii). The learned PCIT was not justified in law and on facts in rejecting appellant's application for recognition u/s. 80G(5) Act. The learned PCIT be directed to grant recognition u/s. 80G(5) of the Act.
(iv). The Id. PCIT has further erred on facts and in law in ignoring the fact that the appellant trust was granted exemption u/s 80G(5) since 92-93 and also holding that the activities of the trust were of a religious nature. He ought to have appreciated that the activities of the trust were carried out in accordance with the objects of the trust and were for the benefit of general public and all facilities of the trust were made available to general public without distinguishing between community, caste, creed and religion.
3. Assessee delay 13 days of appeal, support of the same, appellant filed an application alongwith affidavit for condoning the delay.
4. The appellant, a charitable trust is registered with the Assistant Charity Commissioner, Junagadh vide Registration No. A-938/Junagadh dated 25/08/1965 and from time to time Books of accounts of the trust are also audited.
5. The application for registration of the trust u/s. 80G(5) of the Income Tax Act, 1961 was received on 17/09/2014 by the office of the Learned Commissioner of Income Tax-III, Rajkot in Form No.10G under ITA No.263/Rjt/2015 Shri Mataji Kankeshwari Temple Trust vs. PCIT -3- rule 11AA of the Act. Due to restructuring w.e.f 15/11/2014, the case has been transferred to the office of the Principal Commissioner of Income Tax. The list of the Objects of the Trust includes many activities.
6. A letter dated 04/12/2014 was issued to the applicant to furnish detailed note on the activities actually carried out by the Trust as well as the following documents/details:
i. Copy of Bank Account since inception of Trust or last three years.
ii. Copy of order u/s. 12AA or copy of notification u/s. 10(23C) or a/s. 35 of the IT, Act.
iii. Copy of audited accounts of last three years of Trust who completed one or more years.
iv. Notes and evidence on genuineness of the activities of the trust since inception of the trust.
v. Whether the income of the trust is exempt u/s. 11 & 12 or 10(23C) or 35 of the Act.
vi. Whether the trust is expressed for the benefit of any particular religion, community or others?
vii. Whether any business is carried on by trust for which separate books of accounts are maintained?
viii. Whether any object of the clause of deed is such that it is against social cause.
ix. Whether the expenditure on religious purpose is with a 5% or not? Give figures and calculation.
x. Copy of Certificate of Undertaking?
xi. Copy of Certificate u/s. 13(1) (c) of the I.T. Act?
xii. Declaration u/s. 11(5) of the I.T. Act?
xiii. Details of donations received or paid and confirmation/PAN of the donors, xiv. Further, it is seen that as per Trust deed the dissolution clause is not proper /not there.
7. In response to the aforesaid letter, the application Trust appears on 07/01/2015. On the perusal of the details/documents submitted by the ITA No.263/Rjt/2015 Shri Mataji Kankeshwari Temple Trust vs. PCIT -4- applicant trust, it is found that objects of the trust are purely religious in nature. Some objects of the trust are as under:
• "To do and supervise the worship of the godess Kankeshwari by the pujari of the temple and celebration of other festivals and ceremonies of the temple including the Havans and Yagnas and to provide articles for worship.
• To provide accommodation for persons using the sanatorium and allot rooms to the beneficiaries, devotees of godess kankeshwari, pilgrims and sant, sadhu.
• To appoint pujaris and other staff to assist pujari on salary basis and to evolve code of conduct in respect of their service. • To appoint required staff to look after and manage the temple and trust properties and the account of the trust."
8. On verification of Audit Report submitted by the trust for F.Y. 2011-12, 2012-13 & 2013-14 it is seen that the trust incurred expenditure on Religious purposes more than 5% which is not tenable. The details of which are as under:
F.Y. Total Income Total Expenditure % incurred on Religious on Religious Purposes.
Purposes
2011-12 56,78,705/- 15,84,131/- 27.90%
2012-13 53,96,165/- 12,61,617/- 23.38%
2013-14 42,41,332/- 7,98,375/- 18.82%
9. From the above table it is clear that the appellant trust incurred expenditure on religious purposes more than 5%. Under the context, the learned Principal Commissioner of Income Tax issued a show cause vide order sheet noting dated 07/01/2015 and requested to give its explanation as to why the application filed in form No. 10G for approval u/s. 80G(5) of the Act should not be rejected as the objects of the trust is religious.ITA No.263/Rjt/2015
Shri Mataji Kankeshwari Temple Trust vs. PCIT -5-
10. In response to the show cause issued, the applicant trust submitted the inter alia which is as under:
"The objects of the trust are mixed objects, i.e. charitable and religious objects. The activities of the trust is charitable also and not only religious."
11. But some was not tenable in the eyes of the learned PCIT. Therefore, application filed in Form No.10G for approval u/s. 80G(5) of the Income Tax Act was rejected by the learned Principal Commissioner of Income Tax(OSD)(Exemptions), Ahmedabad.
12. Against the said order Trust preferred an appeal before ITAT.
13. We have gone through the relevant record and impugned order, whereas learned DR relied upon the order of the OCIT and filed his objection and stating that it was held in this decision that by virtue of the non-obstinate section 80G(5B), even if a religious trust incurs expenditure during any previous year of religious nature for an amount not exceeding 5% of its total income in that previous year, it is deemed as an institution or fund to which provision of section 80G applies.
14. It was further stated that in the total expenditure on religious purposes exceeds 5% as mentioned in Para 4.1 of the order of CIT.
ITA No.263/Rjt/2015Shri Mataji Kankeshwari Temple Trust vs. PCIT -6- Therefore, the assessee trust is not eligible for the deduction u/s.80G(5) as the provisions of Section 80G(5B) applies.
15. On the other hand, learned AR cited a judgment of Supreme Court in the matter of Commissioner of Income Tax, Ujjain vs. Dawoodi Bohara Jamat [2014] 43 taxmann.com 243 (SC):
It is held that Section 13, read with Section 12AA and 11, of the Income- tax Act, 1961 - Charitable or religious trust - Denial of exemption (Sub- section (1)(b)) - Whether where assessee trust is formed with both religious and charitable objects, in terms of Section 13(1)(b), its claim for registration under section 12AA can be denied only in a case when such objects are carried out for benefit of a particular religious community or caste.
16. In this case, matter was decided in favour of the assessee.
17. Learned AR stated that trust is involved in the religious as well as charitable activities.
18. Further, learned AR cited a judgment in our own Bench in the matter of Shri Yamunaji Mandir Turst vs. CIT in ITA No.330/Rjt/2015 in similar matter Co-ordinating Bench allowed the appeal of the assessee and granted registration under section 80G(5). In the matter of CIT Vs K.H. Kasumgar [1987] 63 CTR 70 (Bombay):
Section 5(1)(v), read with section 5(1A), of the Gift-tax Act, 1958 - Exemption - Gift to charitable institution - Whether gilt made by assesses of immovable properties to a public charitable trust, object of which was imparting of education, encouragement and promotion of study and practice of Shweetamber Jain religion amongst students of ashram, etc., without distinction of Sex, caste, place or religion, was exempt under section 5(1)(v)- Held, yes.ITA No.263/Rjt/2015
Shri Mataji Kankeshwari Temple Trust vs. PCIT -7-
19. Respectfully, following the aforesaid judgment, we allow the appeal of the assessee and set aside the order of the Principal CIT and allow the appeal of the assessee for statistical purpose.
20. In the result, appeal filed by the assessee is allowed for statistical purpose.
This Order pronounced in Open Court on 24/04/2017
Sd/- Sd/-
(MANISH BORAD) (MAHAVIR PRASAD)
ACCOUNTANT MEMBER JUDICIAL MEMBER
Ahmedabad; Dated 24/04/2017
Priti Ydav, Sr. PS
आदे श क
त ल प अ े षत/Copy of the Order forwarded to :
1. अपीलाथ / The Appellant
2. यथ / The Respondent.
3. संबं'धत आयकर आयु)त / Concerned CIT
4. आयकर आयु)त(अपील) / The PCIT(A)- Ahmedabad.
5. ,वभागीय /त/न'ध, आयकर अपील य अ'धकरण, अहमदाबाद / DR, ITAT, Ahmedabad
6. गाड4 फाईल / Guard file.
आदे शानुसार/ BY ORDER, स या,पत /त //True Copy// उप/सहायक पंजीकार (Dy./Asstt.Registrar) आयकर अपील य अ!धकरण, अहमदाबाद / ITAT, Ahmedabad True copy