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2015 (9) TMI 707 - ITAT HYDERABAD

2015 (9) TMI 707 - ITAT HYDERABAD - [2015] 40 ITR (Trib) 550 (ITAT [Hyd]) - Approval under section 80G(5)(vi) - DIT (E) granting approval subject to the condition that such approval shall be given effect only after the amendment to the trust deed is carried out through civil court - Held that:- Assessee has fulfilled all the conditions of clauses (i) to (v) of section 80G(5) and has also made necessary amendment to clause 3.2 of the trust deed confining its activity to India. That being the case .....

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elevant to note that the learned Director of Income-tax (Exemptions) is also satisfied that the assessee is eligible for approval under section 80G(5).

As far as the decision of the hon'ble Supreme Court in the case of CIT v. Kamla Town Trust [1995 (11) TMI 1 - SUPREME Court] it is relevant to mention that the hon'ble Andhra Pradesh High Court in the case of DIT (Exemptions) v. Ramoji Foundation [2015 (2) TMI 900 - ANDHRA PRADESH HIGH COURT ] taking note of the said decision has held .....

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tions), Hyderabad granting approval under section 80G(5)(vi) of the Income-tax Act, 1961, to the assessee subject to the condition that such approval shall be given effect only after the amendment to the trust deed is carried out through civil court. 2. There is a delay of 587 days in filing the aforesaid appeal. The assessee has filed a petition seeking condonation of delay, explaining the cause of delay. The learned authorised representative submitted before us, after the order was passed, the .....

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e are of the view that there is sufficient reason for condoning the delay as the assessee in pursuance to the directions of the learned Director of Income-tax (Exemptions) had approached the civil court which resulted in belated filing of the present appeal. Therefore, being satisfied with the bona fide reasons for delay, we condone the same and admit the appeal for hearing. 4. Briefly the facts are, the assessee is a trust registered under section 12A of the Act. The assessee applied in Form 10 .....

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s amended the trust deed by incorporating a clause, which restricted the activities and objects of the trust within India. Considering such amendment to trust deed, the Income-tax Appellate Tribunal remitted the matter back to the file of the learned Director of Income-tax (Exemptions) for considering the assessee's request for granting of approval under section 80G(5)(vi) of the Act. In pursuance to such direction of the Income-tax Appellate Tribunal, the learned Director of Income-tax (Exe .....

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n'ble Supreme Court in case of CIT v. Kamla Town Trust [1996] 217 ITR 699 (SC). Thus, the learned Director of Income-tax (Exemptions) held that only after the assessee carries out such rectification/ amendment through civil court having jurisdiction over the matter, grant of approval under section 80G(5)(vi) will be effective. Being aggrieved of the aforesaid observation of the learned Director of Income-tax (Exemptions), the assessee is before us. 6. The learned authorised representative su .....

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. He submitted, there is no need to approach the civil court for rectification/amending the trust deed as the assessee-trust is empowered under the trust deed to carry out the amendment. In this context, he referred to the judgment of the hon'ble Andhra Pradesh High Court in the case of DIT (Exemptions) v. Ramoji Foundation [2014] 364 ITR 85 (AP). 7. The learned Departmental representative, on the other hand, supporting the order of the learned Director of Income-tax (Exemptions) submitted b .....

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e Act, but, in the impugned order the learned Director of Income-tax (Exemptions) has, in fact, granted approval under section 80G(5)(vi) to the assessee, though, putting a condition that such approval will be effective from the date of amendment to the trust deed is approved by civil court having jurisdiction over the matter. Therefore, there cannot be any dispute to the fact that not only the assessee's objects and activities are charitable in nature but it has also fulfilled the condition .....

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necessary amendment to the trust deed by confining its activities to India but has also observed that the assessee has fulfilled all the conditions of sub-clauses (i) to (v) of section 80G(5) of the Act. The observations of the co-ordinate Bench in this regard is extracted hereunder for the sake of convenience : "13. There is no denial of fact that the assessee-institution, in the present case, is registered under section 12AA of the Income-tax Act. The hon'ble Gujarat High Court in th .....

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to inclusion in its total income'. Thus what is to be seen is whether any income would not be liable to inclusion in its total income and not whether because of certain defaults prescribed in section 11 or 13, the trust is not actually held eligible for exemption under sections 11 and 12 of the Act. Once the condition laid down in rule 11AA as also in sub-clauses (i) to (v) of sub-section (5) of section 80G are complied with, the trust is, eligible for registration under section 80G(5)(vi) o .....

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there is no reason to deny the approval under section 80G of the Act by the Director of Income-tax (Exemptions). More so, in the present case, the assessee has already made amendment to the trust deed whereby the clause 3.2 was amended as follows : 'the activities of the trust and its objects will be confined only to India.' Being so, as on date, there cannot be any objection to grant approval under section 80G of the Act as the impugned clause is amended by the trust. In the circumstanc .....

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