TRIBAL FOUNDATION,WEST SINGHBHUM vs. CIT EXEMPTION, PATNA

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ITA 369/RAN/2016Status: DisposedITAT Ranchi30 May 2018AY 2016-174 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the rejection of registration should not be based on the application of income but on the genuineness of the activities. The CIT(E) was directed to grant registration to the assessee.

What were the facts?

The assessee, a society, applied for registration under Section 12AA of the Income Tax Act. The CIT(E) rejected the application, stating that grant-in-aid is not income and therefore activities funded by it cannot be considered the society's activities.

What were the issues?

Whether the CIT(E) erred in rejecting the application for registration under Section 12AA based on the nature of funding rather than the genuineness of the charitable activities.

Which sections of the Income-tax Act were involved?

Section 12AA

AI-generated summary — verify with the full judgment below

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Income Tax Appellate Tribunal, RANCHI

Before: SHRI N.S.SAINI & SHRI PAVAN KUMAR GADALE

For Appellant: Shri Vinay Kumar Jalan & Rajiv Ranjan,Adv
For Respondent: Shri K.E.Sunil Babu
Hearing: 28.05.2018Pronounced: 30.05.2018

1 ITA No.369/Ran/2016

IN THE INCOME TAX APPELLATE TRIBUNAL, RANCHI BENCH, RANCHI

BEFORE SHRI N.S.SAINI, ACCOUNTANT MEMBER & SHRI PAVAN KUMAR GADALE, JUDICIAL MEMBER

ITA No.369/Ran/2016 A.Y. : 2016-2017 Tribal Foundation, vs CIT(E), Patna Nowamundi Basti, PO-Nowamundi, District- West Singhbhum, Jharkhand-833217 PAN No. : AAEAT 4189 N Respondent (Appellant) .

Assessee by : Shri Vinay Kumar Jalan & Rajiv Ranjan,Adv Revenue by :Shri K.E.Sunil Babu Date of Hearing : 28.05.2018 Date of Pronouncement : 30.05.2018

O R D E R Per Pavan Kumar Gadale, JM: This is an appeal filed by the assessee against the order of CIT(E),

Patna, dated 26.10.2016.

2.

The sole issue involved in the present appeal of the assessee is with

respect to rejection of application for grant of registration u/s.12AA of the

Act.

3.

Brief facts of the case are that the assessee is a society and filed an

application dated 05.05.2016 seeking registration u/s.12AA of the Act,

however, the CIT(E) rejected the application for grant of registration on the

ground that as the grant-in-aid will not be income of the trust/society,

2 ITA No.369/Ran/2016 therefore, the activities carried with this grant-in-aid cannot be activity of

the trust/society and he is not satisfied about the activities of the society.

4.

Aggrieved by the order of CIT(E), the assessee has filed an appeal

before the Tribunal.

5.

Ld. AR before us submitted that the CIT(E) has erred in rejecting the

application of the assessee for grant of registration u/s.12AA of the Act and

submitted that the CIT(E) has ignored the fact that providing shelter to poor

primitive tribes is one of the object of the assessee society which is

intimately interwoven with the main object of the assessee society to

provide support to the community for a cause of economic betterment and

upliftment of social status of the people. Ld. AR of the assessee filed the

paper book along with copy of various forms for registration and other

details as envisaged in the paper book containing 292 pages. The

contention of the ld. AR that the CIT(A) should have considered these facts

and granted registration.

6.

Contra, ld. DR supported the order of CIT(E).

7.

We have heard the rival submissions and perused the material on

record. The sole dispute is with respect to rejection of registration u/s.12AA

of the Act. Ld.AR to substantiate that the activities of the assessee society

are genuine, has filed details before us which are as under :-

i) Orders of the Hon'ble ITAT in the case of M/s Shiv Shishya Samprawah and M/s Vaishwik Shiv Shishya Pariwar ii) Written submission placed before the CIT(Exemptions) vide Letter No TF/2016-17/137, Dated 20.10.2016

3 ITA No.369/Ran/2016 iii) Copy of Form 10A iv) Copy of Certificate of Registration, Memorandum of Association and Article of Association registered under Societies Registration Act v) Details of services/activities towards the fulfillment of the aim and objectives of the Institution along with the documentary evidence vi) Copy of all Bank Pass Books since its inception vii) Books of accounts & ITR (if any) since its inception viii) Copy of Rent Agreement, No Objection Certificate and Resolution of Working committee ix) Copy of Electricity Bill/ Tax Receipts along with the Affidavit of the Landlord & ID Proof x) Welfare activities carried out with progress report since its inception and details in respect of the activities carried out xi) Break-up/ List of Donors (General & Corpus) along with their address and PAN xii) List of Governing Body members along with their complete address and ID Proof xiii) Explanation regarding how the aim and objects of the trust/ institution are within the meaning of "Charitable Purpose" xiv) Copy of resolution passed / extract of Minutes Books for Registration of society u/s 12A of the Act xv) Copy of Denial Order u/s 12A of the Act along with relevant documents xvi ) List of Members of the Society xvii) Copy of proceeding book xviii) Brief Presentation of the Society

8.

Ld. AR further relied on the decision of coordinate bench of the

Tribunal in the case of Vaishwik Shiv Shishya Samprawah, ITA

No.129/Ran/2015, order dated 28.02.2017, wherein it is held that the

registration u/s.12AA cannot be rejected based on the application of

income but the CIT(A) has to consider the genuineness of the activities and

4 ITA No.369/Ran/2016 the activities which is not in dispute and further we are of the opinion that

similar issue was dealt by the Hon’ble Madras High Court in the case of

DIT(E) Vs. Seervi Samaj Tambaram Trust [2014] 362 ITR 199 (Madras

HC) and applying the ratio of law laid down to the present facts of the case,

we direct the CIT(E) to grant registration to the assessee u/s.12AA of the

Act. Thus, the ground of appeal of assessee is allowed.

9.

In the result, appeal of the assessee is allowed.

Order pronounced in the open court on 30/05 /2018

Sd/- Sd/- (N.S.SAINI) (PAVAN KUMAR GADALE) ACCOUNTANT MEMBER JUDICIAL MEMBER Ranchi, Dated 30/05/2018 Prakash Kumar Mishra , Sr. Ps Copy of the Order forwarded to : 1. The Appellant – Tribal Foundation, Nowamundi Basti, PO-Nowamundi, District-West Singhbhum, Jharkhand-833217 2. The Respondent – CIT(E), Patna 3. The CIT(A) concerned 4. CIT , concerned 5. DR, ITAT, Ranchi 6. Guard file.

BY ORDER,

//True Copy// SR.PS, ITAT, RANCHI

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