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TMI Blog2009 (11) TMI 52X X X X Extracts X X X X X X X X Extracts X X X X ..... Registration Act, 1860. The certificate of registration dated 28.01.2003 has been added with the petition (Annexure P-1). The petitioner-Trust applied for exemption under Section 80-G of the Income Tax Act and the application was rejected vide impugned order dated 30.09.2003 Annexure P-11). One Mrs.Mohini Bawa was possessed of huge immovable property at village Mansoorwal Donna, Jalandhar Road, Kapurthala. Out of her desire of creating an Educational Trust solely for charitable purposes to impart and provide facilities for education to the public at large, she executed an irrevocable deed of Trust on 12.12.2001. She bequeathed all her rights and interest in the property comprised in the land which is now known as Guru Kirpa Complex, situated at village Mansoorwal Donna, Jalandhar Road, Kapurthala. The total area of land is approximately 20 Kanals and 15 Marlas alongwith the structures erected thereupon. It also includes movable properties including Computers and peripherals etc. which are fully described in the schedule of property forming part of the registered Trust Deed (Annexure P-2) executed for setting up the petitioner- Trust. The petitioner-Trust has claimed that in pursua ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... returns claiming exemption under Section 10(23C)(iiiad) and Section 11 of the Income Tax Act, which has never been issued any notice under Section 143 (2) of the Income Tax Act, which in turn implies that the assessment on the basis of return filed has been accepted as complete. On 18.03.2003, the petitioner made an application to the respondents for grant of registration under Section 80-G (5)(vi) of the Income Tax Act on the prescribed Form 10-G (Annexure P-4). The respondent sought clarification on certain issue from the petitioner-Trust vide letter dated 23.07.2003 (Annexurpe P-5). The petitioner-Trust sought time to furnish the required documents. On 05.08.2003, the books of accounts of the petitioner-Trust were produced before the respondent, which were duly inspected. The petitioner-Trust pointed out that its expenditure has been more than 75% of its collections on setting up the School and the Institute of Technology which was in accordance with the objects set out in the Trust Deed. Accordingly, the petitioner-Trust requested for grant of registration vide its application dated 06.08.2003 (Annexure P-6). Some more details were furnished vide letter dated 13.08.2003 (Anne ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ses are not for charitable purposes." A perusal of the aforesaid order discloses the following three grounds for rejection:- Firstly, that the unsecured loans have been received by the petitioner-Trust from the trustees, which are stated to have come from the Bank of America, DCM Building, 16 Barakhamba Road, New Delhi and BNP Paribas, Hansalaya, 2nd Floor, Barakhamba Road, New Delhi. The aforesaid funds have come from outside India and appears to have been contributed by NRI trustees living in U.K. and Hong Kong. The Commissioner, in her orders has noticed that no evidence was furnished to show that these amounts were contributed by NRI trustees from abroad and the money really belonged to them. Secondly, Clause 'c' under the heading other incidental objectives of the Trust Deed (Annexure P-2) is capable of being treated as independent and cannot be said to be for charitable or non-charitable. Thirdly the petitioner-Trust has incurred expenses for the stay of its trustee in a hotel at Jalandhar, which violate Section 13 of the Income Tax Act. In the written statement, filed on behalf of respondent, broad factual averments made by the petitioner-Trust in the petition have been ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... collectively). According to learned counsel all the entries and the source of money has been explained by the aforesaid annexures with the details of cheque number, account number and the name of the trustee, who is contributing the funds. On the aforesaid basis, learned counsel has submitted that the matter required re-consideration at the hands of the Commissioner, who has passed the impugned order. In respect of the second ground that there is violation of Section 13 of the Income Tax Act, learned counsel has submitted that the object given in Clause (c) under the heading either incidental objectives cannot be torn out of context and read in isolation. Learned counsel has drawn our attention to Clause 4 (e) and (i) under the heading main objects and clauses (c), (F) and (1) under the heading other incidental objectives, as also Clause 8, Clause 25 and 26 of the Trust Deed. He has further submitted that a conjoint reading of these clauses would show that clause (c) which is aimed at sale, mortgage, transfer, exchange etc. or to deal with any property or asset belonging to the Trust is only empowering the trustees to perform numerous functions for the purposes of advancing the ob ..... X X X X Extracts X X X X X X X X Extracts X X X X
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