TMI Blog2011 (3) TMI 526X X X X Extracts X X X X X X X X Extracts X X X X ..... rimary power may be rendered otiose - Held that: maintenance of latrines is an essential, and inseparable incidental activity to attain the sublime and the dominant aims and objects of the respondent There are needless and profuse references to Dr. Bindeshwar Pathak, the founder of Sulabh Shauchalaya movement, without impleading him as party respondent - Learned counsel for the respondent has vehemently objected to the derisive manner in which the appellant refers to his consultation services rendered to the respondent organization as "…lecture of the founder ….', and also attributes to him diversion and siphoning off funds of the respondent - Appeal is dismissed - Misc. Appeal No. 657 OF 2010 - - - Dated:- 30-3-2011 - SUDHIR KUMAR KATRIAR, SAMARENDRA PRATAP SINGH, JJ. Rishi Raj Sinha, Harshwardhan Parsad for the Appellant. M.L. Verma, S.K. Verma, A.K. Rastogi, S. Alamdar Hussain, Anil K. Sinha, Arindam Mukherjee and Kumari Gargi Tuli for the Respondent. ORDER S.K. Katriar, J. ‑ Heard learned counsel for the parties at length. The following issues have been formulated for adjudication in this appeal, purporting to be substantial questions of la ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pondent's income under the Act for the assessment year 2006-07. The respondent is a society registered under the Societies Registration Act, 1860. Its aims and objects have been set out in the impugned order, and we shall have the occasion to refer to them at the appropriate stage. It is also registered as a charitable institution by the Commissioner of Income-tax in terms of section 12A of the Act. The respondent is engaged in the charitable work of abolishing the system of service latrines, installation of inexpensive water-seal, flush latrines for the poor people as a common and general facility, and also to take care of the problems of, and abolish the inhuman practice of, manual scavenging, and carriage of head-load of human excreta. In order to attain its aims and objects, the respondent ever since its registration in 1971, in relentless pursuit of its revolutionary step, has been building flush latrines in public places. It has been building toilets on mass scale for public use, has also carried out the function of running, repair and maintenance of those latrines, as well as the task of abolition of manual scavenging, and disposal of human excreta by its carriage by Bhangis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... facts. He has also held that running and maintenance of the gigantic operation of the respondent is likely to bring in its wake cash in-flow which is essential for the maintenance of the project, and for further attainment of its aims and objects. 3.3 Aggrieved by the order of the learned Commissioner, the department preferred appeal before the learned Tribunal which has been dismissed by the impugned order, and the order of the learned Commissioner has been upheld. The learned Tribunal in its elaborate judgment has upheld the findings of facts recorded by the learned Commissioner, and dismissed the appeal. 4. While assailing the validity of the impugned order, the learned Assistant Standing Counsel submits that maintenance of latrines is nowhere to be found in the aims and objects of the respondent and, therefore, the cash in-flow of the respondent on account of maintenance of its project does not qualify for exemption from taxation. He has taken us through the order of the learned assessing officer in an effort to satisfy us that the huge in-flow of cash is per se indicative of commercial nature of activities. He wraps up his elaborate submissions by submitting that the impug ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ward such cost as it deems fit. (6) The High Court may determine any issue which- (a) has not been determined by the Appellate Tribunal; or (b) has been wrongly determined by the Appellate Tribunal, by reason of a decision on such question of law as is referred to in sub-section (1). [(7) Save as otherwise provided in this Act, the provisions of the Code of Civil Procedure, 1908 (5 of 1908), relating to appeals to the High Court shall, as far as may be, apply in the case of appeals under this section.] [Emphasis supplied] 7. It is evident that, in view of the mandate of law, an appeal under section 260A of the Act will be maintainable before the High Court if the appellant is able to satisfy this Court that it involves a substantial question of law. This expression has acquired a definite connotation over the years by authoritative pronouncements of the Supreme Court and High Courts. The same expression occurs in section 100 of the Code of Civil Procedure which provides that a second appeal shall lie in this Court if the High Court is satisfied that the case involves a substantial question of law. It has been consistently held that the High Court in exercise of its ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of law. In exercise of the powers under section 260A of the Act, the findings of facts of the Tribunal cannot be disturbed. The right of appeal is neither a natural nor an inherent right attached to the litigation. Being a statutory right, it has to be regulated in accordance with law in force at the relevant time. Such an appeal cannot be decided on merely equitable grounds. The expression 'Substantial question of law' has not been defined anywhere in the Statute. But it has acquired a definite connotation through various judicial pronouncements. The conditions mentioned in section 260A must be strictly fulfilled before an appeal can be maintained under section 260A. 9.1 In Sir Chunilal Mehta Sons Ltd. v. Century Spg. Mfg. Co. Ltd. AIR 1962 SC 1314, the Supreme Court laid down the following tests to determine whether a substantial question of law is involved. The tests are: (1) whether directly or indirectly it affects substantial rights of the parties, or (2) the question is of general public importance, or (3) whether it is an open question in the sense that the issue is not settled by pronouncement of this Court or Privy Council or by the Federal Court, or (4) the issue i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Bench of this Court to which one of us (S.K. Katriar, J.), was a party, passed the judgment dated 28-9-2010 in C.W.J.C. No. 4748 of 1997 Dr. Bindeshwar Pathak v. CIT 2011(1) B.B.C.J. 595, wherein the present respondent was respondent no. 5. On the issue of consistency, this Court observed as follows: "7. Learned counsel for the petitioner submits that consistency is the hall-mark of justice and the assessee should not be rattled by inconsistent decisions of the authorities. Every assessee is entitled to organize his affairs in the manner they perceive to have been accepted by the authorities in the previous years. Learned counsel for the petitioner has rightly relied on assessment orders and the appellate orders with respect to respondent nos. 3 to 7 with respect to the past periods which are to the same effect as the appellate orders for the period in question. Looking at it from this angle, the view taken by the learned assessing authority in the present case with respect to the period in question seems to be without justification. There was no allegation against the petitioner nor against respondent nos. 3 to 7, of suppression of income or material facts. A mere change of opi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to have been accepted by the authorities for such a long length of time. No such change of circumstances is discernible in the present case. The learned authorities under the Act have neither come across new facts or circumstances, nor suppression of fact, and is really a case of different view on the self-same facts as it obtained before the Settlement Commission. The view taken by the Settlement Commission has been followed by the learned authorities under the Act even for the periods that have followed the ones in question apart from the preceding periods." 8. The learned assessing authority should trust honest assessees, and discard their returns for very valid reasons in a situation like the present one, as it had happened in the case of Dr. Narendra Prasad (supra), that the Department has taken a consistent view for all these years except the period in question. We hope the learned authorities under the Act will keep this in mind in future, otherwise it gives rise to clearly avoidable litigations, and rattles honest assessees." 12. We really regret to record that the learned Assessing Officer completely overlooked the principle of consistency, and passed an illegal order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd help to all the municipalities, notified area committees, corporations, other connected organizations and government departments all over the world in abolishing the system of service latrines and assisting in the installation of Sulabh Shauchalayas in its place. 3(v) To train government employees in this work with the cooperation of the departments concerned. 3(vi) To try to find out total easy and practical solutions to many problems, like those of public health, personal health, manure, food, economic problem, the problem of Bhangis and of unemployment, by providing for public and general use, the Sulabh Shauchalaya system and by giving wide publicity to it, to arrange demonstration-cum-training camps and to boost agricultural output with the help of manures. ** ** ** 3(viii) To make easily available materials such as water-seal, pan etc. required for its constructions, to arrange for contractors and to prepare materials for the Shauchalayas on no-profit-no-loss basis and to construct the Shauchalayas on contract basis. ** ** ** 3(xi) To render full cooperation and help in making the Government spon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the two activities as being disjointed activities shall create an absurdity in law and in fact that will neither be sustainable in law nor desirable. 15. We do not feel the necessity of referring to the remaining aims and objects of the respondent. It is evident that abolition of service latrines, installation of toilets for the common man in public places described as Sulabh Shauchalaya, taking care of the problem of Bhangis and the extraordinary idea of abolition of manual scavenging is undoubtedly amongst the dominant aims and objects of the respondent. If the contention of the appellant were to be accepted that maintenance of these latrines were not essential and incidental to the dominant object indicated above, the latrines would be in a state of disrepair within a short time in a situation where it is being used by general public on mass scale. For example, it may lead to an undesirable obnoxious situation that the toilets would be without doors, deprived of all privacy. Does the appellant desire this revolutionary movement to reach this ludicrous state? We are quite convinced in the facts and circumstances of the case that maintenance of latrines is an essential, and in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s mass movement ever since 1971, with identical aims and object, identical structure of working, and identical recognition as a charitable institution in terms of section 12A of the Act. The aims and objects over all these years have remained unchanged, and the recognition as a charitable institution in terms of section 12A of the Act still subsists. There has been no material change in the facts and circumstances, and never has suppression of facts, misrepresentation, fraud or the like been attributed to the respondent, and this position has been accepted all through, by the department and upheld by this Court, notwithstanding which we fail to understand the kind of approach adopted by the learned assessing officer in the present case. The Courts have repeatedly observed that consistency is the hall-mark of administration of justice, and all courts as well as the authorities exercising quasi-judicial functions, may follow this salutary principle of law, otherwise it generates unwanted litigations. 18. This Court is left with the feeling that the department of Income-tax has not shown due consideration to the Sulabh Shauchalaya movement. If that were not so, the learned assessing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orporations of Patna, Darbhanga, Arrah and Begusarai) were unduly favouring respondent no. 29 by their action in giving the contract of maintenance of public lavatories to it. It is stated that a public auction for giving the contract would bring substantial sums of money to the concerned Corporation/Municipality. The petitioner goes on to make an offer of Rs. 40 lakhs, for the right to maintain public lavatories under the respondent Corporation/Municipalities and makes a prayer that a direction be made in his favour. The case of the petitioner appears to me to be plainly based on the notion that maintenance of public lavatories is analogous with the collection of tools for a bridge or a road. In fact the main thrust of Mr. Mahto's argument was that the State, in the distribution of its largesses cannot be allowed to take a discriminatory stance. 6. To my mind the argument is quite misconceived and it completely over looks the circumstances in which the Sulabh Sauchalayas came into existence in the first place. The argument also fails to see that certain basic technological knowledge is necessary for the maintenance of the Shauchalayas in an efficiently working state. 7. It is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... job to agencies duly recognized by it." We entirely agree with the observations made by the learned Single Judge. 20. Learned counsel for the respondent has rightly raised grievance with respect to certain unsavoury and unwarranted statements made in this memorandum of appeal. There are needless and profuse references to Dr. Bindeshwar Pathak, the founder of Sulabh Shauchalaya movement, without impleading him as party respondent. Learned counsel for the respondent has vehemently objected to the derisive manner in which the appellant refers to his consultation services rendered to the respondent organization as " lecture of the founder .', and also attributes to him diversion and siphoning off funds of the respondent. We record our feeling of displeasure for such irresponsible and irrelevant statements in the memorandum of appeal in the absence of Dr. Bindeshwar Pathak. The question of payment of fee to Dr. Bindeshwar Pathak, and diversion of funds of ancillary organizations including the respondent herein, was the subject matter of CWJC No. 4748 of 1997 Dr. Bindeshwar Pathak's case (supra), allowed by a Division Bench on 28-9-2010, to which one of us (S.K. Katriar, J.) was a p ..... X X X X Extracts X X X X X X X X Extracts X X X X
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