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Income Tax Appellate Tribunal, DELHI BENCH “H”: NEW DELHI
Before: SHRI B.R.R. KUMAR & SHRI ANUBHAV SHARMA
O R D E R PER ANUBHAV SHARMA, J. M.:
1. 1. The appellant has come in appeal against the order dated 30.08.2019 passed by the ld Commissioner of Income Tax (Exemption) [in short the ld CIT(E)] u/s 12AA of the Income Tax Act, 1961 (hereinafter referred as „the Act‟) by which an application granting registration u/s 12AA was rejected and consequently, approval u/s 80G was also rejected.
2. The facts in brief are that the Assessee filed application electronically in Form No. 10A and Form 10G on 16.02.2019 seeking registration u/s 12AA and exemption u/s 80G of the Income Tax Act, 1961. The ld CIT(E) called for necessary information and based upon the information about the activities undertaken by the Assessee the ld CIT(E) concluded that the activities are not strictly charitable and also observed that grant of registration have potential of misuse. Thus, the applicant has approached this Tribunal raising following grounds of appeal:- “1 On the facts and in the circumstances of the case and in law the order of the Ld. Commissioner of Income Tax (Exemptions), Delhi rejecting the application for Registration u/s 12AA of the Income Tax Act, 1961 is arbitrary, misconceived, fallacious and illegal and having been done on imaginary, fictitious and unsubstantiated grounds must be quashed with further directions to grant the registration as sought.
2. On the facts and in the circumstances of the case and in law the order of the Ld. Commissioner of Income Tax (Exemptions), Delhi rejecting the application for Registration u/s 80G(5)(vi) of the Income Tax Act, 1961 is arbitrary, misconceived, fallacious and illegal and having been done on imaginary, fictitious and unsubstantiated grounds must be quashed with further directions to grant the registration as sought.”
As the case was called for hearing, none appeared on behalf of the Assessee. Notices were issued for hearing on 22.04.2022 for today. Due to non-return of the notices, 30 days of issue by registered post with acknowledgement, drawing presumption of service, as none has appeared for the Assessee, the argument of the ld Sr. DR heard who endorsed the orders of the ld CIT(E).
4. Appreciating the matter on record it can be observed that in the impugned order the ld CIT(E) has taken into consideration the objects in general which have been mentioned in para Nos. 2, 3 and 4 as under:- “2. The object of the trust has been mentioned in Form 10A as:- “To Promote healthy relationship between public and police and redressal of public grievances related to crime, whole India and abroad.” The trust has been settled by Sh. Rakesh Kumar Maheshwari and the founder trustees include many prominent personalities. While the objects are in general for the benefit of the public, some the objects of the applicant are strictly not charitable as per u/s 2(15) of the Act, 1961, given as under:-
(i) “iii To encourage and educate general public to assist the Police department to curb unlawful activities, and act against criminals ” (ii) ix...To coordinate with the appropriate authorities in respect of civil and criminal matters, (iii) xxi ...Regular dialogue and rapport with central, State Government and 3. Information on the activities undertaken by the assessee was filed. It is seen that the applicant has filed a letter dated 09.06.2019 in respect of its activities details, which was addressed to the Hon’ble Chief Minister, U.P. Some of the contents from that letter are as under:- “..2...To take action against the earring Police Officers of the Police Station of Tappal who were responsible for dereliction in performing their duty..
3. To book the culprits in Posco act and NSA and submit charge sheet in Fast Track Court forgetting justice in Fast Trek Court..” These activities are not strictly charitable and to some extent attempt to encroaching upon Government’s functioning.
Also the applicant has given a note on key activities, which is as under: Crime Reduction: The Public-Police will advocate for alternatives to arrest and incarceration as a means of reducing crime. Programs will be initiated in increasing the use of restorative justice and to that effect Conferences in reforming the money bail system and reforming parole and probation systems will be held.’’ On perusal of the details/objects of the Public Police from the Trust Deed dated 22.01.2019, the name of the applicant appears to be that of a Government Agency. It is also seen that Public Police is using a symbol similar to Government Agencies which may deceive general public while dealing with the Trust. In view of these it appears that the main purpose of the Trust is to establish itself as a shadow or parallel of the agencies bv the Government and the Police of the country. Accordingly, on 23.08.2019 vide note-sheet, an explanation has been asked as perj under: (i) Please explain how the activities carried out by the Trust is charitable in nature as defined u/s 2(15) of the I. T. Act... (ii) As per the Deed, the charitable objects & purposes in India and abroad, pi. Explain.”
Though the applicant had tried to explain to ld CIT(E) about its activities as referred in para 5 of the order and reproduced below:- 5. In response to explanation, the applicant has filed its reply on 26.08.2019, wherein the applicant has given a note on activities done since its inception, are as under:- i) “...(C) The Trust has started the Water bottle distribution to the Traffic Police and Police Personals at the place where the water is required. ii) (D) The Trustees had visited to the Police Stations and discussed with SHO and DCP for the problem of their families…” The activities of the applicant are not in line for the charitable purposes for public at large accordingly and not in accordance with the provisions of section 12AA which stipulate the following conditions for registration u/s 12A of the IT Act, 1961:- (i) The objects of the society/Trust should be of charitable in nature. (ii) The activities of the society/Trust should be genuine. So far as the object of carrying out activities outside India is concerned, the assessee has explained with judicial decisions that same should not be a bar for the 12AA registration. However, as the provision of section 11 permits application on charitable activities carried out within India, object prevention of crime outside India cannot form part of the main object of an assessee.”