TMI Blog2022 (3) TMI 709X X X X Extracts X X X X X X X X Extracts X X X X ..... istration u/s. 12AA of the Act. Accordingly, we set aside the order of the Ld. CIT(E) and direct him to grant registration to the assessee trust. Appeal of the assessee stands allowed. - ITA No. 209/CHD/2021 - - - Dated:- 28-2-2022 - N. K. Saini , Vice President And Sudhanshu Srivastava , Member ( J ) For the Appellant : Tej Mohan Singh , Advocate For the Respondents : Vivek Nangia , CIT , DR ORDER Per Sudhanshu Srivastava , Judicial Member This appeal is preferred by the assessee against the order dated 11.06.2021 passed by the Ld. Commissioner of Income Tax (Exemptions), Chandigarh [hereinafter referred to as 'CIT(E)']. 2. The brief facts of the case are that the assessee is a Trust and had applied for Registration u/s. 12A of the Income Tax Act, 1961 (hereinafter called 'the Act') The Ld. CIT(E) rejected the assessee's application for registration vide order 24.08.2017. Aggrieved, the assessee preferred an appeal against the said rejection before this Tribunal. The Chandigarh Bench of the Tribunal restored the issue to the file of the Ld. CIT with a direction to pass a speaking order in accordance with law after giving a reasonabl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... using registration without considering the replies and evidence filed by the assessee which is arbitrary and unjustified. 4. That the order of the Ld. Commissioner of Income Tax is erroneous, arbitrary, opposed to law and facts of the case and is, thus, untenable. 3. The Ld. AR submitted that the assessee had furnished voluminous documents before the Ld. CIT(A) to demonstrate that it was carrying out charitable activities, albeit, also in the form of CSR activities for its parent company KDDL Ltd. He drew our attention to the response dated 05.02.2021 which had been submitted before the Ld. CIT(E), wherein, the assessee had filed a chart for financial years 2017-18 to 2019-20 outlining the relevant clauses under which the assessee trust had incurred expenditure towards charitable activities. Our attention was drawn to list of donations made during F.Y. 2017-18 which was enclosed at page 171 onwards of the paper book. Similar list of donations and activities carried out in assessment years 2018-19 and 2019-20 were also filed and our attention was drawn to the various evidences filed in this regard and forming part of the paper book from pages 172 to 220. The Ld. AR submitte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee trust had not applied its income as per the objectives of the trust and donation to other trust was not an object of the assessee trust. The Ld. CIT DR also placed reliance on the order of the Amritsar Bench of the ITAT in the case of Goenka Charitable Trust Vs. CIT(E) Chandigarh reported in [2018] 89 taxman.com 31 (Amritsar-Trib.), wherein, the Ld. CIT(E) refused registration u/s. 12AA of the Act by holding the assessee to be captive in-house trust. The Ld. CIT DR submitted that the Ld. CIT(A) had rightly rejected the assessee 's application for registration u/s. 12AA of the Act. 5. We have heard the rival contentions and have also perused the material on record. We have also gone through the detailed note which had been prepared by the assessee on the activities of the assessee's trust for the period from 3.2.2016 to 31.3.2020. This note is placed at pages 129 of the paper book and is also part of the Annexure 8 of the submissions filed before the Ld. CIT(E). For a ready reference, we are reproducing this note here-in under:- Initially the Trust has contributed ₹ 4,75,000/- as donation to the IIMPACT, a charitable L-initiative started by the alumni ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e also worth reproducing herein under;- 1. Eradicating hunger, poverty and malnutrition, promoting healthcare including preventive health care and sanitation including contribution to the Swachh Bharat Kosh set up by the Central Government for the promotion of sanitation and making available safe drinking water; 2. Promoting education, including special education and employment enhancing vocation skills especially among children, women, elderly and the differently abled and livelihood enhancement projects; 3. Promoting gender equality, empowering women, setting up homes and hostels for women and orphans; setting up old age homes, day care centres and such other facilities for senior citizens and measures for reducing inequalities faced by socially and economically backward groups; 4. Ensuring environmental sustainability, ecological balance, protection of flora and fauna, animal welfare, agro forestry, conservation of natural resources and maintaining quality of soil, air and water including contribution to the clean Ganga Fund set up by the Central Government for the rejuvenation of river Ganga; 5. Protection of national heritage, art and culture including ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecided by Coordinate Bench of the Tribunal (ITAT - Chandigarh Bench) in the case of Roundglass Foundation Vs. CIT(E) (supra), wherein, it has been held that merely because the assessee trust had been found by another company for complying with CSR requirements, it cannot be denied registration u/s. 12AA of the Act unless the genuineness of the activities of the assessee's trust or its charitable objects are doubted. We also note that ITAT Delhi Bench in the case of Nanak Chand Jain Charitable Trust v. CIT(E), (supra) considered the objection of the Ld. CIT(E) in that case that the activities of the assessee trust were not in consonance with the provisions of Companies Act 1956. The Delhi Bench went out to hold that there was no requirement to see whether the activities of the assessee trust were in sync with the Companies Act or not. The Ld. CIT(A), in the present appeal, has also made similar observations and we are of the view that the facts in this appeal are identical to the facts in the case of Nanak Chand Jain Charitable Trust v. CIT(E), (supra) as well as in the case of Roundglass Foundation Vs. CIT(E) (supra). 5.3. At this juncture, it will be relevant to extract the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... egistered trust or a registered society or a company established by the company or its holding or subsidiary or associate under section 8 of the Act or otherwise. Even Companies Act provide for compliance of CSR provision through a dedicated trust or society. Just because the trust has been formed for complying CSR requirements it cannot per se be the reasons for denying registration under Section 12AA of the Income Tax Act. As regards the reasons (iii) given by the CIT (exemption) that the object of trust are to be noted whereby apart from the CSR activities, the Activities in the nature of eradicating hunger and poverty, promotion of education, promoting gender equality etc. are also provided. These activities are in the nature of public charity. Further, the CSR Activities itself are in the nature of public charitable activities. As regards the reasons (iv) given by the CIT (exemption), no activities in sync with the requirement of the Companies Act has taken place in the trust so far. For the purpose of granting registration under Section 12AA only two factors are to be seen by the CIT (E) which are the objects of the trust being charitable in nature and the genuineness ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot applicable as the factual matrix in those cases are totally different. Thus, the order passed u/s. 12AA and u/s. 80G(5)(vi) of the Income Tax Act, 1961 are set aside. We direct the CIT to grant the registration u/s. 12AA of the Act and also the approval u/s. 80G(5)(vi) of the Act to the assessee. 10. In result, both the appeals of the assessee are allowed. 7. Identical issue has been further decided by another Coordinate Delhi Bench of the Tribunal in favour of the assessee trust in the case of the 'Escorts Skill Development, Faridabad vs. CIT (Exemption)' in ITA Nos. 527 528/Delhi/2017 vide order dated 26.4.2019. 8. The Ld. DR has not brought to our knowledge any distinguishing fact or case laws contrary to the findings given in the above referred to decisions of the Coordinate Benches of the Tribunal. Hence, respectfully following the same and for the sake of consistency, this issue is decided in favour of the assessee. The impugned order of the CIT(E) is, therefore, set aside and the Ld. CIT(E) is directed to grant exemption u/s. 12A of the Act to the assessee company. In the result, the appeal of the assessee stands allowed. 5.4. During the ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
