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2016 (8) TMI 808 - ITAT COCHIN

2016 (8) TMI 808 - ITAT COCHIN - TMI - Application for registration u/s 12A refused - denial of benefit of registration for the reasons that original/copy of the instrument is not filed in support of creation of the trust - whether execution of a formal deed of trust is necessary for granting registration u/s 12A ? - Held that:- In the instant case the religious institution was established by an order of a Bishop, called ‘decree’. On perusal of the ‘decree’, it is clear that a religious institut .....

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s appeal, at the instance of the assessee, is directed against the CIT (Exemption) s order dated 29.9.2015. 2 The grounds raised read as follows: i) The order of the CIT(E) is against the facts and circumstances of the assessee s case and hence opposed to the provisions of the I T Act. ii) The CIT(E) ought to have considered the fact that a charitable or religious institution need not be a trust/society in all cases. iii) The CIT(E) has erred in stating that the assessee did not file the documen .....

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tration u/s 12A of the Income Tax Act in the prescribed form No.10A as a Religious Institution. The CIT(E) rejected the assessee s application stating that since the applicant has not produced original/copy of the instrument in support of creation of the trust, the objects and its activities as well as the existence of the trust could not be ascertained. I therefore, refuse to register the Trust and the application for registration u/s 12A filed on 31.3.2015 is rejected. 4 Aggrieved by the above .....

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the copy of the same was filed along with the application in Form 10A and the original of the decree was produced for verification at the time of hearing before the CIT(E). Therefore, it was submitted that it was not proper on the part of the CIT(E) to deny the benefit of registration for the reasons that original/copy of the instrument is not filed in support of creation of the trust. 5 On the other hand, the ld DR supported the order of the CIT(E). 6 We have heard the rival submissions and per .....

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rust or institution shall be made in duplicate in Form no.10A and shall be accompanied the following documents namely; a) Where the trust is created, or the institution is established, under an instrument, the instrument in original, together with one copy thereof, and where the trust is created, or the institution is established, otherwise then under an instrument, the document evidencing the creation of the trust or the establishment of the institution, together with one copy thereof; Provided .....

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said application is made) for which such accounts have been made up.) 7. A plain reading of Rule 17A make it clear that a religious or charitable organization can be an institution other than a trust . The usage of the words charitable or religious trust or institution in the first and second limb of the rule 17A connotes that; where the Trust is created or institution is established, under an instrument, the instrument in original together with a copy thereof, has to be filed along with the pre .....

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institution/trust should be established under an instrument. What is required is only a document evidencing the creation of the Trust or the establishment of the institution together with a copy thereof. In the instant case, assessee is a Religious Institution (Parish) created under the conventional way by issuing a decree under Cannon law by the concerned Bishop. The creation of religious institution is evidenced by the decree issued by the Bishop. The true copy of the decree has been placed in .....

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ion would be sufficient for seeking registration u/s 12A of the I T Act. The Tribunal, after considering Rule 17A of the I T Rules 1962, held at paras 13 to 17 of its order, as follows: 13. A plain reading of Rule 17A(a) makes it clear that where the Trust is created, or the institution is established, under an instrument, the instrument in original, together with one copy thereof, has to be filed along with prescribed Form No.10A for registration of the Institution/Trust u/s 12A of the Act. How .....

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established under an instrument. The Rule 17A does not prescribe that in case the Institution/Trust is established otherwise than under an instrument, what type of document evidencing the creation of the Trust or the establishment of the Institution, has to be filed, meaning thereby that the document evidencing the creation of Trust or the establishment of Institution could be of any type. As per the provisions of the Indian Trust Act, the Trust can be created even orally and if the assessee is .....

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and should be registered with the Registrar of Properties etc., is devoid of any merit as Rule 17A of the Income-tax Rules, 1962 itself provides that where the institution or the trust is established otherwise than under an instrument, the document evidencing the creation of the trust or the establishment of the institution, together with one copy thereof can be filed along with the prescribed form No.10A for registration u/s 12AA/12A of the Act. What would be the document evidencing creation o .....

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. The plea of the learned CIT-DR, that the trustees took refuge in Sikkim which is part of India since 1975 for 35 years, no return of income was filed by the assessee nor any application for registration u/s 12A was submitted and that the returns for the assessment year 2005-06 to 2010-11 do not contain the stamp affixed by the Department showing the date of receipt thereof, has no relevance as the assessee has sought the benefit of registration u/s 12AA/12A from assessment year 2011-12 onwards .....

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violation of law of the land for which separate proceedings are pending before the Hon ble Court and shall not affect the issue that whether the assessee trust was having aims and objects and purposes of charitable in nature entitled to registration u/s 12AA/12A of the Act. 15. In Laxminarayan Maharaj and Another Vs. CIT - [1984] 150 ITR 465 (MP), the trust was created 100 years ago without any instrument of document. However, the revenue records relating to land held by the trust, orders relati .....

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mmissioner to reconsider the application of the trust in the light of the observations made by the Hon ble High Court. The Hon ble High Court held :- When the trust is a trust created under an instrument, rule 17 requires filing of 'the instrument in original' and when the trust is created otherwise than under an instrument 'the document evidencing the creation of the trust has to be filed. An analysis of section 12A(a) and rule 17A(a) will show that the fact to be established is the .....

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trust. The evidential documents cannot be limited to documents which directly prove the creation of the trust; they will embrace all documents which afford a logical basis of inferring creation of the trust and all such documents can be described to be 'document evidencing the creation of the trust' within the meaning of rule 17A( a). A document directly evidencing the creation of the trust is normally the constitutive document which cannot be produced when the trust is not created by an .....

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ers produced by the petitioners consisted of Jamabandis of 1910-11, 1929-30, patta issued in 1931 and Jamabandi of 1954-55. In all these documents, the petitioner-trust is entered as tenant or bhumiswami and the name of the Sarbarahkar is also mentioned. The assessment orders relating to the property tax for 1967-68 to 1974-75 were filed. All these documents, though not directly evidencing the creation of the trust, afford a logical basis for inferring creation of the trust prior to 1910-11 and .....

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at the Institution/Trust was created centuries ago in the year 1159 AD and that no formal deed for the Trust was executed at that time. We find that the Indian Trust Act has not come into existence in the year 1159 AD and it was not possible to execute a deed of Trust on stamp paper or in writing centuries ago. However, the supreme Head of the Trust, i.e., 17th Karmapa, who is the supreme spiritual Head of Karma Kagyu lineage, has made a declaration of Trust on stamp paper on 29th day of March, .....

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in 1159 AD to be the main seat of the Karma Kagyu lineage, a sect of Buddhism practiced all over the world. It declared that the present 17th Karmapa is the supreme spiritual Head of Karma Kagyu lineage and that he is recognized all over world and the voluntarily customary offerings from devotees all over the world remain untouched by Karmapas, as they do not accept or own any kind of properties personally by continuing tradition of diverting all these offerings at source to charitable purposes .....

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