Income Tax Appellate Tribunal - Mumbai
Bai Hemkorebai Devidas & Devidas ... vs Assessee on 10 April, 2013
ITA No.2102/M u m/ 2 0 1 2
B a i H e m ko r e b a i D e v i d a s
& D e v i d a s P ur p h o o d a s C h a r i t i e s
आयकर अपील य अ धकरण "बी" यायपीठ मब
ुं ई म।
IN THE INCOME TAX APPELLATE TRIBUNAL " B " BENCH, MUMBAI
BEFORE SHRI B. RAMAKOTAIAH, AM AND Dr. S.T.M. PAVALAN, JM
आयकर अपील सं./I.T.A. No. 2102 /Mum/2012
( नधारण वष / Assessment Year :2012-13
Bai Hemkorebai बनाम/
बनाम DIT (E) 6 t h Floor,
Devidas & Devidas Piramal Chambers, Parel
Vs.
Purphoodas Charities Mumbai-400012
1103 Stock Exchange
Tower, Dalal Street,
Fort, Mumbai-40001
थायी ले खा सं . /PAN : AAATB4217G
(अपीलाथ / Appellant) .. ( यथ / Respondent)
अपीलाथ क ओर से / Appellant by
Shri Niraj Seth
:
यथ क ओर से/ Respondent by :
Shri Pravin Varma.
सन
ु वाई क तार ख / Date of Hearing : 10.04.2013
घोषणा क तार ख /Date of Pronouncement : 19.04.2013
आदे श / O R D E R
PER B. RAMAKOTAIAH, A.M. :
This Appeal preferred by the Assessee is against the order of the Director of Income Tax (Exemption) dated 28.02.2012, wherein the DIT rejected the application for registration under section 12AA of the IT Act. The Assessee has raised following grounds.
"1. On the facts and in the circumstances of the case and in law, the Ld. Director of Income Tax (Exemption) erred in rejecting the appellant's application for approval of the institution under section 12AAof the Income Tax Act 1961 on the ground that the appellant has not carried out activities.
2. The Learned Director of Income Tax (Exemption) failed to appreciate the fact that registration to the Institution could not have been denied without recording dissatisfaction about the genuineness of activities of the appellant institution or about the activities of the Institution.
3. Without prejudice to the above, the appellant submits that the Learned Director of Income Tax (Exemption) at the stage of granting registration, is not to examine the application of income. But to examine only if the 1 ITA No.2102/M u m/ 2 0 1 2 B a i H e m ko r e b a i D e v i d a s & D e v i d a s P ur p h o o d a s C h a r i t i e s activities of the trust were not genuine or were not been carried out in accordance with the objects of trust."
2. Briefly stated, the Assessee made an application for registration in Form 20 A on 28.08.2011 for registration under section 12AA of the IT Act, which the Ld. DIT rejected holding that the trust has not carried out any activity by which it would enable the Competent Authority to look into the activities as genuine or not. Assessee is aggrieved.
3. Learned Counsel submitted that the Assessee came into existence consequent to the orders of the Hon'ble High Court of Judicature at Bombay in Suit No. 3360 of 1947 vide order dated 29th July.1948. He placed on record the copy of the order of the Hon'ble High Court, which established the Trust for administering the property along with its objects and how the Trust should conduct. It was submitted that this Trust came into existence more than 65 years back and was applying the income for the Trust objects which has specified vide Para 17, 18 & 19. It was further submitted that owing to small income on property by way of rental, there is no occasion to apply for any registration under the IT Act as there was no taxable income. It was further submitted that the small amount received was being applied towards the objects which was mainly for helping the medically needy people. In AY 2010 the Trust property was sold and assessee had substantial capital receipts and therefore, the Trust has to make application for registration so that it can enjoy the benefit of exemption. It was the submission of the learned Counsel that the DIT did not examine the objects which is necessary for registration of the Trust. It is also submitted that assessee had provided all accounts and details before the DIT and there is no question about either the past activities or about the application of the money towards the objects of the Trust. The learned Counsel relied on the decision of the ITAT Amritsar bench in the case of Dream Land Educational Trust Vs. CIT reported in 166 Taxman 27 (Asr). The learned Counsel also further relied on the decision of the ITAT, Delhi Bench in the case of Acharya Sewa Niwas Uttaranchal Vs. CIT 13 SOT 54 Delhi (URO). It was the submission that since the DIT did not examine the Trust objects and its activities and without examining rejected the registration.
2 ITA No.2102/M u m/ 2 0 1 2B a i H e m ko r e b a i D e v i d a s & D e v i d a s P ur p h o o d a s C h a r i t i e s
4. The learned DR however submitted that DIT at para 8 & 9 has held that the trust is not genuine and therefore the order is to be upheld.
5. We have considered the issue and the rival contentions. The DIT rejected the registration holding that the Trust has not carried out any activity which would enable the competent authority to look into the activities of the Trust. However, as seen from the constitution of the Trust, it came into existence by way of the order of the Hon'ble High Court way back in 1948 and the same is also registered with the Charity Commissioner on 14.07.1953. It is also a fact that the rental income received being small does not require to be registered so as to claim any exemption and it was submitted that whatever the meager incomes received, these have been utilized for the objects of the Trust. In our opinion, the learned DIT did not examine the objects of the Trust so as to consider the same for registration under section 12AA.
6. The ITAT Amritsar Bench in the case of Dream Land Educational Trust Vs. CIT held that:-
Section 12AA prescribes the procedure for registration of a trust. As per this section, the Commissioner, on receipt of an application for registration, shall call for such documents or information for the trust as he thinks necessary in order to satisfy himself about the genuineness of the trust and may also make such enquiry as he may deem necessary in this behalf; and that after satisfying himself about the objects of the trust and the genuineness of its activities, he shall pass an order in writing, registering the trust. Therefore in accordance with section 12AA, the Commissioner was required to satisfy himself about the objects of the trust and the genuineness of its activities. In the instant case, the Commissioner had not recorded any dissatisfaction on either of these two aspects.
7. Further in the case of Acharya Sewa Niwas Uttaranchal Vs. CIT 13 SOT 54 ITAT held that:-
Under Section 12AA the jurisdiction of the Commissioner is confined to satisfying himself about the objects of the trust and the genuineness of the activities and for this purpose, he is authorized to make such enquiries as he may deem fit. The Commissioner, in the instant case, had not taken any objection to the charitable nature of the trust. In fact, the objects of the trust as declared in the trust deed, were all charitable objects and there was no finding recorded by the Commissioner to the contrary. The real objection of the Commissioner appeared to be that the initial contribution of Rs.500/- made by the founder of the trust and 3 ITA No.2102/M u m/ 2 0 1 2 B a i H e m ko r e b a i D e v i d a s & D e v i d a s P ur p h o o d a s C h a r i t i e s dedicated to the objects of the trust was hardly sufficient to carry out the charitable activities of the trust. The sufficiency or otherwise of the initial contribution made by the founder to the trust fund is not a relevant factor while dealing with an application for registration under section 12AA. The section in terms did not make it a consideration for the grant of registration.
8. Keeping in view the principles laid down by the Coordinate Benches and also perusing the order of the DIT Exemption, we have no hesitation in holding that the DIT did not consider the issue of registration in its correct perspective. In order to enable him to examine and do the needful, we set aside the order dated 28.02.2004 and restore the issue to the file of the DIT for fresh examination of the assessee's Trust objects and activities for the purpose of granting registration. Assessee is directed to place the relevant details before the DIT for the purpose of examination. Accordingly, the grounds are considered allowed for statistical purposes.
9. In the result, appeal is treated as allowed for statistical purposes.
Order pronounced in the open court on 19.04.2013 .
आदे श क घोषणा खल
ु े यायालय म दनांकः 19.04.2013 को क गई ।
Sd/- Sd/-
(Dr. S.T.M. PAVALAN) (B.RAMAKOTAIAH)
या यक सद य / JUDICIAL MEMBER लेखा सद य / ACCOUNTANT MEMBER
मुंबई Mumbai; दनांक Dated 19.04.2013
व. न.स. / Ashish PS
आदे श क त ल प अ े षत/Copy
षत of the Order forwarded to :
1. अपीलाथ / The Appellant
2. यथ / The Respondent.
3. आयकर आयु (अपील) / The CIT(A)-, Mumbai
4. आयकर आयु / CIT - , Mumbai
5. वभागीय त न ध, आयकर अपील य अ धकरण, मुंबई / DR, ITAT, Mumbai B
6. गाड फाईल / Guard file.
ु ार/ BY ORDER,
आदे शानस
स या पत त //True Copy//
उप/सहायक पंजीकार (Dy./Asstt. Registrar)
उप/
आयकर अपील य अ धकरण,
धकरण, मुंबई / ITAT, Mumbai
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