Income Tax Appellate Tribunal - Chennai
Spirit Of Life Revival Trust, Tuticorin vs Assessee on 9 November, 2011
IN THE INCOME TAX APPELLATE TRIBUNAL
'B' BENCH, CHENNAI
[BEFORE SHRI HARI OM MARATHA, JUDICIAL MEMBER
AND SHRI N.S. SAINI, ACCOUNTANT MEMBER]
S.P. No.66/Mds/2011
(in I.T.A. No.1310/Mds/2011)
&
I.T.A.Nos.1310 & 1316/Mds/2011
Assessment year : 2011-12
M/s Spirit of Life Revival vs The Income Tax Officer,
Trust, Ward
No.164-G, North Beach Road,
Tuticorin - 628 001.
[PAN - AAJTS8067Q]
(Petitioner/Appellant) (Respondent)
Petitioner/Appellant by : Shri N. Devanathan, Advocate
Respondent by : Shri A.C. Joseph, CIT-DR
Date of Hearing : 09.11.2011
Date of Pronouncement : 18.11.2011
ORDER
PER HARI OM MARATHA, JUDICIAL MEMBER:
These appeals have been filed by the Assessee-Trust against separate orders of the ld. CIT, Madurai, but dated 10.5.2011, whereby he has refused to register the Trust u/s 12AA and also declined to grant recognition u/s 80G of the Act.
:- 2 -: S.P. No.66/Mds/11
ITA Nos. 1310 & 1316/Mds/11
2. Briefly stated, the facts of the case are that the Assessee-Trust filed its application for registration u/s 12AA on 28.11.2010 in Form No.10A. The Trust was created on 4.1.2010 (sic 18.10.2010). The ld. CIT called for the reports of the lower authorities and asked the Assessee-Trust to produce the books of account, bills/ vouchers/donation receipts etc. to prove the genuineness of its activities. The Trust was created by Pastor F. Rymond, who has declared as the Founder and Author of the Trust. The ld. CIT found that the activities done by the Trust are admixture of both religious and charitable ones. The Trust was running a Church at D.No.37, Vadi Street, Tuticorin, wherein around 100 people were attending the service. So, according to the ld. CIT, the Trust was engaged in religious activities. Copies of accounts for the year ending 31.3.2011 revealed that most of the expenses were incurred by the Trust for religious activities and other expenses were administrative in nature. With reference to sections 11(1)(a) and 13(1)(b) of the Act which restricts their benefits when the objects of the Trust are admixture of both religious and charitable. Finally, the ld. CIT has found that the genuineness of the Trust and its charitable activities being carried out in terms of the Trust Deed have not been found to be established with documentary evidence. Inspite of various opportunities given, he has :- 3 -: S.P. No.66/Mds/11 ITA Nos. 1310 & 1316/Mds/11 refused to register the Trust in terms of the provisions of section 12AA(1)(b) of the Act. He has also refused to grant recognition u/s 80G because registration u/s 12AA has been refused. Aggrieved, the Assessee-Trust has filed these appeals. It has filed a stay petition also for the stayal of the above orders.
3. After hearing both sides, we have found that even if the objects are found to be admixture of charitable as well as religious in nature, registration u/s 12AA cannot be refused. In this regard, we rely on our order dated 3.3.2011 passed in the case of M/s Prayer for India vs CIT, in I.T.A.No. 196/Mds/2011, assessment year 2008-09. A copy of this order is placed on record for our perusal. For ready reference, we extract paragraph 2 of this order verbatim herein below:
"2. We have heard both parties. In so far as the requisite registration u/s 12AA of the Act by the ld. CIT is concerned, the ld.AR argued that despite the fact that the assessee- trust is created for dong charitable activities, on irrelevant reasons, the ld. CIT has refused to grant registration u/s 12AA of the Act. On the other hand, the ld.DR supported the order of the ld. CIT. We have found that the trust was created on 12.7.2007. A copy of the trust deed was also filed. The objects of the trust are found to be charitable in nature. The ld. CIT has observed that the objects of the trust are mixture of both religious and charitable. The Cochin Bench of the Tribunal in the case of The Society of Presentation Sisters & Another, 318 ITR (AT) 287(Cochin), while dealing with an identical issue, has held that overlapping of religious and charitable activity cannot be taken as a reason to deny exemption u/s 11(1)(a) of the Act, as it cannot render the objects of the trust as not :- 4 -: S.P. No.66/Mds/11 ITA Nos. 1310 & 1316/Mds/11 charitable in nature. Consequently, we direct the ld. CIT to grant registration to the assessee-trust u/s 12AA of the Act."
4. By respectfully following the above order, we direct the ld. CIT to grant registration u/s 12AA to the Assessee-Trust. Having allowed registration to the Trust, we remit back the issue regarding recognition u/s 80G(5) to the file of the ld. CIT so that he can decide the same in the changed scenario on the merits of the case.
5. Accordingly, appeal in I.T.A.No.1316/Mds/2011 pertaining to registration u/s 12AA stands allowed and I.T.A.No.1310/Mds/2011 pertaining to recognition u/s 80G is allowed for statistical purposes. As we have decided the appeals, the stay petition has become infructuous and hence, dismissed.
The order pronounced in the open court on 18.11.2011.
Sd/- Sd/-
(N.S. SAINI) ( HARI OM MARATHA )
ACCOUNTANT MEMBER JUDICIAL MEMBER
Dated: 18th November, 2011
RD
Copy to: Petitioner/Appellant/Respondent/CIT-I, Madurai/DR