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Sri Gomandir Seva Trust Versus Commissioner of Income-tax - 2013 (9) TMI 121 - ITAT CUTTACK - Income Tax
Even the learned Departmental representative has not been able to establish that a violation of section 11, which was not the issue for consideration by the learned Commissioner of Income-tax for granting registration under section 12AA has been made. - registration u/s 12AA to be allowed - decided in favor of assessee.
.............. been carried out which again has been considered by the learned Commissioner of Income-tax being bent of business activities remains undisputed in so far as maintenance of plant and machineries is allowed to a business entity in the form of depreciation which is a charge on the profit and loss account and not for the purpose of computing excess of income over expenditure. In that view of the matter, we are of the considered view that even the learned Departmental representative has not been able to establish that a violation of section 11, which was not the issue for consideration by the learned Commissioner of Income-tax for granting registration under section 12AA has been made. We therefore set aside the impugned order of the learned Commissioner of Income-tax by allowing the appeal of the assessee and direct the learned Commissioner of Income-tax to grant registration under section 12AA as applied for by the assessee. In the result, the appeal of the assessee is allowed.
Order The order of the Bench was delivered by K. K. Gupta (Accountant Member).-At the outset it is observed that this is the second round of appeal before the Tribunal when on the restoration of the issue by the Tribunal to the learned Commissioner of Incometax in I. T. A. No. 144/CTK/2011, dated September 12, 2011, directing him to grant the registration under section 12A in accordance with law, the learned Commissioner of Income-tax considered the application under the provisions of section 2(15) here again when he sought to correlate the income generated whether was from business activities or from charitable activities and came to conclude that maintenance of livestock does not come under the definition of charitable purpose and also does not come within the meaning of any other objectives of general public utility as regular business of selling of milk for maintenance of goshala is being carried on by the assessee-trust, and holding so he again denied to give registration to the assessee under section 12A, against which the assessee is in the present appeal raising the following grounds. 1. That the order of the learned Commissioner of Income-tax, Sambalpur, dated February 16, 2012, in file No. 36 of 2010-11 under section 12A of the Income-tax Act, 1961, rejecting the application of the appellant-trust, for grant of registration under section 12A of the Income-tax Act in utter disobedience of the order of the hon ble Income-tax Appellate Tribunal in I. T. A. No. 144/CTK/2011, dated September 12, 2011 is illegal, uncalled for and hence liable to be quashed. 2. That the application of the appellant-trust should have been allowed in view of the settled law that the scope of enquiry of the Commissioner of Income-tax is limited about the charitable object of the trust and genuineness of the activities which the hon ble Tribunal, after due examination of the fact and circumstances of the case and being the highest fact-finding authority, had already concluded and observed that it is a genuine goshala trust working for the weak and helpless cows which is of a charitable nature. They have also further opined and held that the activities of selling milk, gobar, khata and manure, etc., for expanding the number of cows and supporting them are a part of charitable activities. The honourable Tribunal has further observed that the case of the appellant is similar to that of the case of Shri Haridevji Gaushala Trust v. CIT 2008 24 SOT 14 (Agra). It is also further held by the hon ble Tribunal that selling milk, gober, khatta and milk, etc., are incidental to the objective of the trust for carrying out the main object of the trust of maintaining goshala. 3. That the hon ble Tribunal after considering the facts and circumstances of the case have given their considered opinion that the assessee-appellant ought to have been granted registration under section 12A of the Income-tax Act, 1961 but the Commissioner of Income-tax has travelled beyond his jurisdiction and not following the decision of the Tribunal, therefore his order is not a speaking order and vitiated in the eye of law. 4. That since the trust has satisfied all the conditions laid down under the law, the learned Commissioner is not justified in refusing to allow registration under section 12A of the Income-tax Act, 1961. 5. That the books of account have been maintained and duly audited by qualified chartered accountant and no adverse comments have been given by the auditor. Without giving sufficient opportunity to the appellant the learned Commissioner of Income-tax is not justified in observing that no proper books of account were produced. That the learned Commissioner of Income-tax himself admits that audited accounts have been submitted. That merely because the proprietor was earlier carrying on business as a proprietor that will be no legal bar to convert the said business as charitable trust unless any irregularities are established. The activities of maintaining goshala with cows and buffalo is not in dispute which itself constitute a charitable activity of general public activity. 6. That the observation of the learned Commissioner of Income-tax is not justified as the same is based on mere suspicion and surmises. 7. That it is settled law that suspicion howsoever strong cannot take the place of evidence or proof. 8. That the case law cited by the learned Commissioner Hiralal Bhagwati v. CIT 2000 246 ITR 188 (Guj) is not applicable under the facts and circumstances of the case of the appellant, rather it supports the case of the appellant. 9. That the observation of the learned Commissioner that maintenance of livestock and goshala does not come within the meaning of charitable work is not correct in view of decisions noted by the honourable Tribunal in favour of the assessee. 10. That there are also other objects like assistance to the needy victims during natural calamities/erection, construction, maintenance of Dharmasala, worship centre, drinking water centre, etc., which are very much charitable in nature. Learned counsel for the assessee submitted that the assessee is in second round in appeal before the Tribunal against the order of the learned Commissioner of Income-tax dated February 16, 2012, as he has again rejected the application of the appellant in utter disobedience of the direction of the Tribunal in I. T. A. No. 144/CTK/2011 dated September 12, 2011, wherein the Tribunal after considering all the facts and circumstances of the case was of the view that the assessee-trust ought to be granted registration under section 12A and for that purpose remanded the matter to the file of the learned Commissioner of Income-tax. He further submitted that the only issue involved in this case is whether the activities of the goshala is charitable in nature and whether having agreed with the fact that the trust is carrying on the activities of maintaining goshala, the learned Commissioner of Income-tax, was justified in refusing .................