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Sri Sai Padhuga Trust Versus Income-Tax Officer (Exemptions)

2016 (5) TMI 68 - ITAT CHENNAI

Exemption on the principle of mutuality claimed - assessee-trust was not registered under section 12AA - Held that:- Admittedly, the assessee is a trust and it is not registered under section 12AA of the Act. The foremost object of the trust is to propagate the ideology of Sri Sathya Sai Baba by installing 108 padhugas. The trust deed also provides for installation of golden padhuga on 109th time. A bare reading of the trust deed clearly says that it is religious in nature and for the entire man .....

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the poojas. There cannot be any identity among the people who are contributing for the poojas and the persons participating in poojas. The assessee is at liberty to receive donation or contribution from any individual across the society. In such a case, as rightly submitted by the learned Departmental representative, the individual beneficiaries of the trust cannot be identified, therefore, there is no question of applying the concept of mutuality. In fact, there is no mutuality in the transact .....

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010-11. 2. Shri G. Baskar, learned counsel for the assessee submitted that the assessee-trust was not registered under section 12AA of the Act for the year under consideration. However, the assessee claimed exemption on the principle of mutuality. The Assessing Officer, in fact, accepted the claim of the assessee under the concept of mutuality. However, in respect of interest income earned by the assessee on fixed deposits was subjected to tax. The Commissioner of Income-tax (Exemptions) in exer .....

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principle of mutuality would be applicable. Referring to the order of the Commissioner of Income-tax (Appeals) for the assessment year 2004-05, learned counsel submitted that the Commissioner of Income-tax (Appeals) found that the assessee is eligible for exemption on the concept of mutuality. On appeal before this Tribunal, this Tribunal however, remanded the matter to the file of the Assessing Officer. Therefore, according to learned counsel, the assessee is eligible for exemption on the conce .....

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e assessee is a trust. The main object of the trust is to spread the divine message of Sri Sathya Sai Baba all over the world and make the human society transformed. The object of the trust is not restricted to any particular individual or group of individuals, therefore, the beneficiaries of the trust cannot be identified. According to the learned Departmental representative, when the beneficiaries are entire human beings and the beneficiaries could not be identified individually, the concept o .....

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fficer in exercise of his jurisdiction under section 263 of the Act. 4. We have considered the rival submissions on either side and also perused the material available on record. Admittedly, the assessee is a trust and it is not registered under section 12AA of the Act. The foremost object of the trust is to propagate the ideology of Sri Sathya Sai Baba by installing 108 padhugas. The trust deed also provides for installation of golden padhuga on 109th time. A bare reading of the trust deed clea .....

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is no restriction for the general public for participating in the poojas. There cannot be any identity among the people who are contributing for the poojas and the persons participating in poojas. The assessee is at liberty to receive donation or contribution from any individual across the society. In such a case, as rightly submitted by the learned Departmental representative, the individual beneficiaries of the trust cannot be identified, therefore, there is no question of applying the concep .....

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