TMI Blog2020 (9) TMI 570X X X X Extracts X X X X X X X X Extracts X X X X ..... or verification but the assessee society/ trust has failed to comply with the said mandatory requirements under Rule 17A of Income Tax Rules. Therefore, the assessee society was not entitled for registration u/s 12AA. As per amended rule 17A of the Income Tax Rules, which are applicable in the case of the assessee, the assessee was not required to furnish the original copy of the documents rather self attested or self certified copy of each and every documents/ instruments was sufficient for the purpose of verification by the ld. CIT (E). This appeal of the assessee society is restored to the file of the ld. CIT(E) for afresh examination of the issue in question and act accordingly. Appeal of the assessee as to grant of approval u/s 80G is interconnected with the appeal of the assessee relating to registration u/s 12AA of the Act. Therefore, this appeal of the assessee is also restored to the file of the ld. CIT(E) for afresh consideration and act accordingly. Appeal allowed for Statistical purposes. - ITA Nos.1062 And 1063/JP/2019 - - - Dated:- 3-9-2020 - Shri Ramesh C Sharma, AM And Shri Sandeep Gosain, JM For the Assessee : Shri Mahendra Gargieya, Advocate Fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e order of the ld. CIT (Exemption), the assessee preferred the present appeal before us on the grounds mentioned hereinabove. All the grounds raised by the assessee are interrelated and interconnected and relates to challenging the order of ld. CIT (Exemption) in rejecting the application of the assessee trust/ society for seeking registration u/s 12AA of the Act. Therefore, we thought it fit to dispose off all the grounds through a consolidated order. 2.3 The ld.AR appearing on behalf of the assessee reiterated the same arguments as were raised by him before the ld. CIT (Exemption) and also relied on the written submission submitted before us which are reproduced below. Brief Facts: The appellant (hereinafter also referred to as Samiti/Society ) is a charitable society, established long back and engaged in promoting nationality, education, personality development of the students without any discrimination of caste, creed and sex. Kindly refer amended objects (PB 6). The facts as noted by the ld. CIT (E) the appellant filed an online application on 12- 01-2019 in Form No. 10A for seeking registration u/s 12AA of the Income Tax Act, 1961. The appellant was issued a lette ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y enquires. U/r 17A appellant is required to produce original/ certified instrument establishing the institution for verification and alleging failure to comply this part, he denied the registration. Hence this appeal. 1. Misreading of the Provisions/ Rules: - No Valid basis: At the outset, it is evidently clear that the Ld. CIT (E) has referred to the preamended Rules 17A which stood prior to the newly substituted Rule 17A by the Income Tax (First Amendment) Rules, 2018 made effective from 19.02.2018. The preamended Rule read as under Rule 17A substituted by the Income-tax (First Amendment) Rules, 2018, w.e.f. 19-2- 2018. Prior to its substitution, said Rule, as inserted by the Income-tax (Second Amendment) Rules, 1973, w.e.f. 1-4-1973 and as amended by the Income-tax (Fifth Amendment) Rules, 1989, w.e.f. 1-4-1988 and the Income-tax (Seventh Amendment) Rules, 2007, w.e.f. 1-6-2007, read as under: 17A. Application for registration of charitable or religious trusts, etc.- An application under clause (aa) of sub-section (1) of section 12A for registration of a charitable or religious trust or institution shall be made in duplicate in Form No.10A and shall be accompanied ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ublic was already filed and is available on record as admitted by the Ld. CIT (E) also in para 2 Pg 1of impugned order. Please see Pr. 5 of Letter 2.05.2019 (PB 14). Moreover, the original Amended Deed was also produced/ vide Pr. 6 of letter dt. 25.05.2019 (PB 19-20). 3. All other conditions fulfilled: Pertinently, the ld. CIT(E) raised voluminous queries vide letter dated 01.04.19 (PB 11-13) raising as many as 26 queries/ issues and all of them were duly replied time to time, filing explanation and the required details were submitted by vide various letters dated 25.05.19 (PB 19-20), dated 10.06.19 (PB 21), dated 11.07.19 (PB 22). Thereapart, the appellant also submitted a statement of activity during FY 2018-19) in accordance with the object which are undoubtedly charitable in nature, the audited financial statements of accounts signed by independent Statutory Auditor already submitted vide reply dated 02.05.2019 as admitted by the Ld. CIT (E) also in the impugned order by observing that, in compliance thereto, Shri GP Singhal, CA (AR) attended and furnished details. The objects are undisputed charitable as per S. 2(15). T The ld. CIT(E) could not raise any other adverse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ollowing case laws directly support the contention of the Assessee: 6.1 CIT (E ) Vs. M/s Arihanth Charitable Trust, Pali DBIT A No. 279/ 2017 vide order dated 14.11.2017 (DPB 1-3), by the Hon ble Rajasthan High Court following the decision of Hon ble Delhi High Court in the case of CIT(E) vs. Tsurphu Labrang in ITA 484/2016 vide order dated 01.08.2016, affirming the decision of ITAT holding as under: 5. It was sought to be urged before the ITAT by the Revenue that there is a specific requirement of filing documents for creation of a Trust along with an application for grant of exemption. In the impugned order, the ITAT referred to Rule 17A (a) of the Income Tax Rules, 1962 which itself envisages the possibility of the Trust being created otherwise than under an instrument in which event it is sufficient if the document evidencing the creation of the trust or the establishment of the institution, together with one copy thereof is provided. The proviso to Rule 17A(a) permits the Commissioner to accept even a certified copy in lieu of the original if the 5 instrument or document in original cannot conveniently be produced. It was rightly pointed out by the ITAT that it is t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d identifiable section of the public. 6.2 B.S. Public Education Society Vs. CIT (2014) 19 NYPTTJ 3708 (Del) (DPB 5- 10) wherein it was held: The income and expenditure account and the balance sheet of the financial year 2010-11 were also furnished. The learned Commissioner in order to verify the claim of the assessee and also the activities of the assessee entertained the submissions of the assessee. The learned Commissioner denied registration to the assessee on the ground that as per r.17A(a) of the Income-tax Rules, 1962 the assessee was to submit the original instrument of its establishment together with the copy thereof and since the assessee has submitted only the photo copy/ certified copy of the instrument therefore the application was not complete and thus the application itself is not worth consideration for registration under s. 12AA of the Act. We find that the learned Commissioner has gone into too much technicalities more specifically when certified copy of the original instrument was duly filed by the assessee. If this was the sole criteria then nothing prevented the learned Commissioner to direct the assessee to file the original instrument. The second ground o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (DPB 15-21) wherein it was held that The CIT refused to grant registration to the assessee-society, inter alia, on the ground of non-production of documentary evidence in respect of aims and objects of the society, absence of audited financial statements and non-explanation regarding registration of the society twice with the Registrar of Firms and Societies. It has been categorically recorded by the Tribunal that one of the objects of the society as mentioned in its bye-laws was to provide free medical aid by opening hospitals, diagnostic centers, maternity home and by organizing special medical camps. These activities had also been demonstrated in the previous three years by the assessee in its balance sheet, income and expenditure account, receipt and payment account which were produced before the CIT. Further, the CIT had not commented adversely on the documents placed before it. With regard to the reason that the assessee had not furnished audited financial statements, it has been recorded by the Tribunal that the same were not relevant for establishing the fact whether the activities of the trust were genuine or not. Even the provisions of the Act do not require audited fina ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... society for verification but the assessee society/ trust has failed to comply with the said mandatory requirements under Rule 17A of Income Tax Rules. Therefore, the assessee society was not entitled for registration u/s 12AA of the Act. 2.6 For meticulously going through the provisions of pre-amended rule 17A as well as amended rules 17A, it is pertinent to take into consideration both the rules as under:- The preamended Rule 17A substituted by the Income-tax (First Amendment) Rules, 2018, w.e.f. 19-2- 2018. Prior to its substitution, said Rule, as inserted by the Income-tax (Second Amendment) Rules, 1973, w.e.f. 1-4-1973 and as amended by the Income-tax (Fifth Amendment) Rules, 1989, w.e.f. 1-4-1988 and the Income-tax (Seventh Amendment) Rules, 2007, w.e.f. 1-6-2007, read as under: 17A. Application for registration of charitable or religious trusts, etc.- An application under clause (aa) of sub-section (1) of section 12A for registration of a charitable or religious trust or institution shall be made in duplicate in Form No.10A and shall be accompanied by the following documents, namely: - (a) where the trust is created, or the institution is established, under an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2.8 It is an undisputed fact that the copy of the amended memorandum of Association (MOA) deed duly attested by Notary Public was already filed by the assessee society/ trust before the ld. CIT (Exemptions) and copy of the said notorized documents has also been placed before us in the paper book . The assessee has also placed on record a letter dated 25- 05-2019 wherein the original amended deed was also produced. The copy of the said letter is also filed at pages 19 to 20 of the paper book. We also rely on the decision of Hon'ble Rajasthn High Court in the case of CIT(E) vs Arihant Charitable Trust, Pali , DBIT Appeal No.279/2017 order dated 14-11-2017 wherein the Hon'ble Rajasthan High Court following the decision of Hon'ble Delhi High Court held as under:- 5. It was sought to be urged before the ITAT by the Revenue that there is a specific requirement of filing documents for creation of a Trust along with an application for grant of exemption. In the impugned order, the ITAT referred to Rule 17A (a) of the Income Tax Rules, 1962 which itself envisages the possibility of the Trust being created otherwise than under an instrument in which event it is sufficie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act. The said question was, and in the view of this Court rightly, answered in the negative. In particular, the Court concurs with the conclusion of the ITAT that It is now well-settled that an objects beneficial to a section of the public is an objects of general utility. The intention of the institution/trust should be impersonal in nature and for a sufficiently defined and identifiable section of the public. In view of the above discussions, we are of the considered view that as per amended rule 17A of the Income Tax Rules, which are applicable in the case of the assessee, the assessee was not required to furnish the original copy of the documents rather self attested or self certified copy of each and every documents/ instruments was sufficient for the purpose of verification by the ld. CIT (E). Therefore, taking into consideration all these facts and circumstances of the case, this appeal of the assessee society is restored to the file of the ld. CIT(E) for afresh examination of the issue in question and act accordingly. Thus the appeal of the assessee in ITA No. 1062/JP/2019 is allowed for Statistical purposes. 3.1 As regards the appeal of the assessee u/s 80G(5)(vi) ..... X X X X Extracts X X X X X X X X Extracts X X X X
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