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Income Tax Appellate Tribunal, ‘A’ BENCH: CHENNAI
Before: SHRI V. DURGA RAO & SHRI G. MANJUNATHA
आदेश / O R D E R
PER SHRI V. DURGA RAO, JUDICIAL MEMBER:
1. This appeal filed by the assessee is directed against the order of the learned Commissioner of Income Tax (Appeals), Salem in dated 30.04.2019 relevant to the Assessment Year 2015-16.
The brief facts of the case are that the assessee is M/s. Marutham Nelli Educational and Charitable Trust applied for registration u/s. 12AA of the Income Tax Act, 1961 (for short ‘the Act’) and the Ld. CIT(Exemptions) granted registration vide order dated 18.02.2016. The assessee has filed return of income for the Assessment Year (AY) 2015-16 on 30.09.2015 which was subsequently revised on 24.04.2016. The Assessing Officer (AO) denied the exemption claimed by the assessee u/s. 11 of the Act for the reason that the original objects on which registration u/s. 12AA of the Act granted are different from the objects for AY 2015-16 for the reason that there is an amendment to the objects. The original objects on which registration u/s. 12A of the Act granted which are as under:
To help the ladles through our Trust who are living Independently by their husband, Widows, Poor ladies, Handicapped ladles, Mentally retarded children’s, and to. assist employment opportunities for welfare of future life of poor ladies, and the trust Is helping for improvement of ladies in the society.
2. The Trust can help the orphans children, pour handicapped children. To provide Educational facilities to these children’s, providing Hostels for their staying, providing -facilities for playing sports by these poor children’s and to Improvement of life style of the poor children. 3. To help financially and physically for Physically handicapped persons, and to get financial benefits awarded by the Government from to time and the same will be disbursed to the poor children. 4. To take necessary steps through the Trust for improving of life style to Villages. 5. To help peoples who are living below the poverty line, to help backward community peoples for improving their life. 6. To help Hill Area tribal peoples through our Trust. 7. To provide job opportunities to the -Educated peoples. 8. To create self employment to the Educated persons who are living without any job after completion of their studies.
To arrange experts to teach Business Techniques, and Export Techniques to the Educational persons.
For conducting Free educ1on and Free advice of Law etc., through the Trust. 11. To protect atmosphere planting of new plants, and conducting frequent meeting to explain the social activities. 12. To protect atmosphere in and around and also neighboring areas. To safeguard the perishable Items available in our country. 13. Conversion of waste lands Into Agriculture lands. 14.To Improve the lifestyle of the farmers. 15. To protect the rights of the Ladies and children’s in the Society. 16. To take action against the persons who are acting against the procedure. 17 To take action for reduction of Crimes In the Country, To Issue better life those who involved In the Criminal life. 18. Abolition of Child Labour orientation. 19. To protect Arts, and their related activities.. 20. To open Hostel for staying of old age peoples and to create Gardens4 Parks etc., for welfare of the Old age peoples, for passing their time iii their old age. 21.To arrange marriages for poor peoples through our Trust. 22.To provide Proper Education to the-Backward Class children through our Trust. 23. To Create Primary School, Middle School, Collges1 Universities, Social Buildings, for studying of Most backward peoples who are living In the country. 24. To arrange a Library for reading the Books .and Magazines by.te Students, and Teachers of the Educational Institutions. 25. Conducting of meetings and to Issue useful information to-the public Arrangement of Tours. 26. To appoint well known Doctors to take care of the public peoples who are suffering along with diseases. 27.To issue well Education to the Poor peoples who are living in the Society, and to help them financially i.e. paying of stipend and Educational expenses for successful of their education. To provide food and shelter to the peoples who are living below the poverty line.
28.To create Hospitals, and to open Medical Colleges, Engineering Colleges, Polytechnic Colleges for studying by the Backward peoples.
Providing maximum medical facilities to the peoples who are, suffering on the society.
Opening of Hospitals In the Villages for benefit of developed Villages. 31.To teach lessons to the Village peoples for Improving their life.
To pay expenses for cremation those who are expired In poor families. 33.To assist other Trusts those who are having the same pprinciples of our Trust.
To help and rehabilitate the persons who are Involved In the Severe crimes.
To get financial assistance from the EduatTOflal111StItUtIOflS, Businessman, and to utilize the funds for development of the Trust.
36. To collect amount from the public peoples, to get loans from the Bank through the Trust on lower interest basis, and to utilize the amount for the above said works.
Arrangements are made to get the financial benefits granted by the Government to the poor peoples, and the same will be disbursed to the poor peoples.” Subsequently, some of the objects are amended on 15th day of 3.
February, 2016 as under:
“Deletion of clause 4(1’) page 4 of the trust deed: To establish and run rehabilitation home and hostel for women who are helpless, below poverty line, handicapped and mentally retarded. Deletion of clause 7 of page 8 to 10 of the trust deed: To appoint as family legal heirs of the trustee in the existing trust, after demise or voluntary retirement of any of the trustee.
To appoint any one of the relative person of the trustee as member in the trust (i.e) son, daughter, son-in-law, daughter-in-law, husband or wife of the trustee.
The trustee who are willing to relieve from the trust, inform the board of trustees that trustee is not intended to appoint any of the legal heir of the trustee and not to claim the right after voluntary retirement.
To appoint any one of person as legal heir other than family legal heir of the trustee and inform the board of trustees for three-fourth majority approval.
The trustee has right to change the family legal heir as well as legal heir of the trustee and inform the board of trustees for three-fourth approval.
Insertion of clause in the para 4(1) of page 4 of the trust deed: It is hereby declare that the main object of the trust is to provide better education to the students in rural areas irrespective of caste, sex, and religion in the country. In addition to educations to provide medical relief, rural development and other social related services.
To establish, run and maintain educational institutions., such as polytechnic, Engineering, medical, agriculture, horticulture colleges and primary, secondary and CBSE schools and provide infrastructure facilities training, lectures, conduct various programmes to the students.
This trust is created as public trust. It is hereby declared and made clear that the benefit of this trust shall be open to all irrespective of the caste, creed, and religion. The property of the trust shall in no case revert to the founder or trustees of these descendants or to any other person. No part of the trust either the corpus of the income there from shall be utilized for any other object other than that of the trust hereby created.
It is hereby declared and made clear that any trustee or member of the trust has no right to claim to appoint any person of his relatives in the trust after his demise or voluntary retirement from trust at any point of time.
The board of trustees has power to appoint additional trustees hi the case of vacancy arises due to death or retirement or any other reason to fultill the object of the trust as per provision of the Income tax act, 1961 and prior approval of the commissioner of the income tax.
All other clauses of this trust shall hence forth from part and parcel of the trust deed dt. W.O3.2OO and this amended deed dated 15.02.2016 shall hence for the form part and parcel of the Trust deed dt. 10.03.2008 operation retrospectively.”
One of the object No.1, which is amended reads as under:
“To establish and run rehabilitation home and hostel for women who are helpless, below poverty line, handicapped and mentally retarded.”
The AO is of the opinion that the assessee has amended original object No.1 and therefore, the original objects are different and due to subsequent amendment made by the assessee for AY 2015-16 which is pending before the AO is different, therefore, it is denied.
We have heard both the sides, perused the materials available on record and gone through the orders of the authorities below.
We have gone through the original objects and subsequent amendment made by the assessee is one of the objects as extracted above and we find that after amending the object No.1, the objects of assessee is remaining the same. The main object of the assessee is to run the educational institution to facilitate to poor children and physically handicapped children. We further find that the status of the assessee as per the original objects as well as subsequent objects, there is no change. The main object of the assessee is to provide education which is common in both original objects as well as subsequent amendment. Further, we find that the subsequent amendment made by the assessee is more specific and mainly relates
7 -: to education, medical relief, rural development and social related services. In view of the above, the Ld. CIT(Exemptions) is incorrect in rejecting the exemption claimed by the assessee u/s. 11 of the Act without properly examining the subsequent amendment made by the assessee on 15.02.2016. In our opinion, the A.O is not correct in denying the claim of the assessee u/s. 11 of the Act, and the same is confirmed by the Ld. CIT(Exemptions). Accordingly, we cancel the order passed by the Ld. CIT(Exemptions) and direct the A.O to allow exemption u/s. 11 of the Act. Accordingly, the appeal filed by the assessee is allowed.
In the result, the appeal of the assessee is allowed.
Order pronounced on 23rd April, 2021 in Chennai.