HIGH COURT OF ALLAHABAD
Commissioner of Income-tax-1
v.
Shri Advait Ashram Society*
R.K. Agrawal and Ram Surat Ram (Maurya), JJ.
IT Appeal No. 439 of 2009†
November 8, 2012
Section
12AA of the Income-tax Act, 1961 - Charitable or religious trust -
Registration procedure - Non-filing of returns, effect of - Whether
non-filing of returns by assessee-trust for last several years cannot be
a ground for declining to grant registration under section 12AA to it,
as Commissioner is only enjoined to see as to whether trust is genuine
and whether object for which it has been formed is for charitable
purpose or not - Held, yes [Para 4] [In favour of assessee]
FACTS
Facts
• The assessee-trust was registered under the Societies Registration
Act, 1860 on 15-12-1978. It applied for grant of registration under
section 12AA on 5-4-2007.
• The Commissioner rejected the
application of the assessee on the grounds that: (i) no reasons had been
given as to why after more than 29 years it had made application for
grant of registration, and (ii) it had not complied with query regarding
furnishing of the information of filing the income-tax returns and
providing proof for the last several years.
• The Tribunal held that not
providing information for the returns since inception was not fatal,
because only inquiry which the Commissioner could make while granting
registration was regarding genuineness of the trust and as to whether
the objects as mentioned in the Trust Deed were for charitable purpose
or not.
• It remanded the matter to the Commissioner to grant registration to the assessee under section 12AA.
Issues involved
• Whether the Tribunal was justified in directing the Commissioner
to grant registration to the assessee under section 12AA ?
• Whether the Commissioner rightly
rejected the application of the assessee for registration under section
12AA, as the assessee was not in a position and unable to furnish the
details and documents as sought by the Commissioner under section 12AA
(1)(a)?
HELD
•
The order passed by the Tribunal does not give rise to any substantial
question of law, for the reason, that non-filing of the returns for the
last several years cannot be a ground for declining to grant
registration, as the Commissioner is only enjoined to see as to whether
the trust is genuine and whether the object for which it has been formed
is for charitable purpose or not. [Para 4]
• Therefore, the order passed by the Tribunal does not suffer from any legal infirmity. [Para 5]
A.N. Mahajan for the Petitioner.
JUDGMENT
1. The present appeal has been
filed under Section 260 (A) of the Income Tax Act, 1961 (hereinafter
referred to as the 'Act') against the order dated 13.2.2009 passed by
the Income Tax Appellate Tribunal, Agra (hereinafter referred to as the
'Tribunal'). The Commissioner of Income Tax, Agra has proposed the
following substantial question of law said to be arising out of the
order of the Tribunal: -
(1) Whether on the facts and circumstances of the case, the
Tribunal is justified in law in directing the Commissioner of Income Tax
to grant registration to the assessee u/s 12-AA of the Act by
completely overlooking the fact that the application for registration
was filed by the assessee after 29 years of it being registered under
the Society Registration Act, 1960 on 15.12.1978?(2) Whether the Commissioner of Income Tax rightly rejected the application of the assessee for registration u/s 12-AA of the Act as the assessee was not in a position and unable to furnish the details and documents as sought by the CIT u/s 12-AA (1) (a) of the Act meaning thereby that genuineness of the activities of the assessee could not be proved?
2. Briefly stated, the facts giving rise to the appeal are as follows: -
The
respondent assessee is a society registered under the Societies
Registration Act, 1860. It was registered on 15.12.1978. It's main
objects as mentioned in the order of the Tribunal are as follows: -
(i) To own, collect, preserve,
develop and administer the properties movable and immovable, that have
been or may hereafter be dedicated to the Ashram or that may have been
or hereafter be acquired from the offering or that may be handed over or
placed in the charge of the Sant Satguru, the working Committee or any
Committees or any individual member, Manager or Agent or that may come
in possession of any of them in their official capacity as such vest in
the Ashram alone and not in the Sant Satguru or any individual in his
official capacity.
(ii) To regulate the conduct of Satsangis and to establish,
run and subsidise religious, educational, sanitary and charitable
institutions with a view to advance the cause of religious, mental,
moral and technical education with the object of doing public good.(iii) To make provision for relief of poverty and distress, particularly of orphans, widows, old, disabled, needy and indigent persons and for such other charities as the ashram may in its discretion consider proper.
(iv) To open dispensaries of any system or systems of medicine and to treat patients there and give them medicine free of charge.
(v) In case of famine or such other natural calamity caused by Act of God, to render and give such help to the poor and destitute persons as the working Committee may in its entire discretion think proper and expedient.
(vi) To make provision for imparting supreme knowledge of Brahm and instruction in correct and effective way of performing "Jap" "Tap" and worship etc. for the uplift of human soul and ultimate salvation.
(vii) To make arrangement for discourses of mahatmas and other distinguished personalities with a view to infuse the spirit of self-sacrifice for the good of others and encourage the outward expression of pious thoughts in acts as well.
(viii) To encourage, promote and enforce the study of trust, lvoe and non-possession and fostering National unity and teaching of the one-ness of human society.
(ix) To make provision for free and unrestricted access to satsangis and other devotees to worship the deities in temple and pay homage to the Samadhi of Satguru Yoganandji Maharaj.
(x)
To take all steps to provide accommodation and to look after the
comforts of Satsangis residing in the Ashram or hailing from other parts
of the country particularly at the Bhandaras of Satgurus' birthdays or
on the days of their departures or on any other days.
(xi) With a view to propagate, enhance and advance the
benefits and spiritual doctrines for the good of the humanity make
provision for the publication of literature including books, pamphlets
and periodicals and distribute them free of charge and pay out of the
Ashram's funds the cost or expenses incurred in that behalf and
necessary to engage persons for the purpose.
For some reasons, it did not apply for
registration under the provisions of the Income Tax Act, 1961 as it
appears that it did not want to avail the exemptions on income earned by
it. However, it applied on 5.4.2007 for grant of registration in the
prescribed form. The CIT, Agra made inquiries and vide order dated
18.10.2007 refused to register the Trust u/s 12-A of the Act. The ground
for refusal as given by the Commissioner was that no reasons have been
given as to why after more than 29 years, the Trust has made an
application for grant of registration u/s 12-A of the Act and further
the Trust had not complied with query regarding furnishing of the
information of filing the income tax returns and providing proof for the
last several years.
3. The Trust feeling aggrieved,
preferred an appeal before the Income Tax Appellate Tribunal. The
Tribunal has held that not providing information for the returns since
inception is not fatal, because only inquiry which the Commissioner of
Income Tax can make while granting registration is regarding genuineness
of the Trust and as to whether the objects as mentioned in the Trust
Deed are for charitable purpose or not. The matter was remanded by the
Tribunal to the Commissioner to grant registration under Section 12-AA
of the Act. However, in the penultimate paragraph of the order, the
Tribunal has directed the Commissioner to afford an opportunity for
filing explanation regarding delay in making the application.
4. We have heard Sri Shambhu Chopra,
learned Senior Standing Counsel for the Revenue and have perused the
impugned order passed by the Tribunal and the Commissioner and are of
the considered opinion that the order passed by the Tribunal does not
give rise to any substantial question of law, for the reason, that
non-filing of the returns for the last several years cannot be a ground
for declining to grant registration as the Commissioner is only enjoined
to see as to whether the Trust is genuine and whether the object for
which it has been formed is for charitable purpose or not.
5. That being the position, we are of
the considered opinion that the order passed by the Tribunal does not
suffer from any legal infirmity.
6. The appeal fails and is dismissed.--
CA Swaran Singh
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