TaxTMI 
TaxTMI 
2012 (12) TMI 489
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....gave a detailed reply and relied on the decisions of the Hon'ble Bombay High Court in the case of Vallabhdas Karsondas Nehata vs CIT, reported in 15 ITR 113, wherein the Hon'ble Bombay High Court held, "that supply of fodder to animals and cattle is a charitable object", and the case of CIT vs Swasthic Textile Trading Co. Ltd., reported in 113 ITR 852, wherein the Hon'ble Gujarat High Court held, "that the object of establishing, maintaining, running and helping gaushalas, panjarpoles for animals etc. is highly charitable". 4. The AO, after considering the detailed reply added the entire collections of Dharmau box amounting to Rs. 5,25,716/- and in the case of Dharmau, for which the assessee was able to identify the donations of Rs. 21,03,286/- reduced this from Rs. 1,00,13,978/- and added Rs. 79,10,691/-. The aggregate addition made by the AO came to Rs. 84,36,407/- (Rs. 5,25,716 + Rs. 79,10,691). While considering the reply of the assessee, the AO came across the amounts of donations, which ranged from Rs. 10/- to Rs. 15/-. It was also brought to the notice of the AO that in the year ended 31.03.1994, the charity commissioner held that expenses on cow grass, miscellaneous expens....
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.... and other miscellaneous objects. We are enclosing herewith a copy of the Scheme of Management and Administration of Petitioner Trust as approved by the Charity Commissioner under section 50A of the Bombay Public Trusts, Act, 1950 3. For last more than 176 years, the trust has been engaged in taking care of the old, infirm and disabled animals and birds. For this purpose, apart from the panjrapole at Bhuleshwar it has branches at Raita, Mala, Walsing, Lakhivali, Chembur and Bhilad. As of February 2010, the Trust had in all 1800 animals and birds in the panjrapole including approximately 1100 cows, 50 bullocks, 50 dogs, 250 goats, 200 pigeons and 150 other bids, etc. The Courts, the Police and the public at large leave the animals and birds who have met with some accident, or who have been ill treated by their owners or who have been rescued from the slaughter houses into the Trust panjrapole. The Trust provides such animals and birds with medical care, food and shelter. 4. It is a well known fact that taking care of old, sick, wounded and infirm animals especially cows and dogs providing them with medical care and feeding them has been always considered as a holy and religious d....
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....eflected by the Gopal Ratna award conferred by the Government of India on the Trust where one of the panjrapole gave the highest quantity of milk for the year 1983-84. The trust has also received various similar awards from state level and national level institutions. Photo copies of some of the other several awards received over the years are also enclosed herewith. 7. The receipts from visitors to the panjrapole towards the expenses of green grass, gol laddu and dana, the total receipts of the Trust including that from the visitors and expenditure incurred by the Trust for the previous years relevant to assessment years 2003-2004 to 2007-2008 are as under: 8. The green grass, gol laddu and dana is taken by the people visitiing the panjrapole for which they pay an amount ranging between Rs. 2 to may be Rs. 150/- per visitor. On an average, on a regular day there are approximately 450 to 600 visitors to the Trust resulting in a daily collection of Rs. 35,000/- approximately. Further, the frequency of these visitors is more focused during the morning hours and is not evenly spread over the whole day. On special days like half moon, full moon and no moon days, the number of visitor....
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....oducing Financial Bill, 2006 in the Parliament on February 28, 2006 in his budget speech at paragraph 168, the Finance Minister observed: "168. The standing committee on Finance has expressed concern that many charitable institutions misuse the provisions of the Income Tax Act. I propose to focus on the misuse, namely, receiving anonymous or pseudonymous donations. Accordingly, I propose that anonymous or pseudonymous donations to wholly charitable institutions will be taxed at the highest marginal rate. Such donations to partly religious and partly charitable institutions / trusts will be taxed only if the donation is specifically for an educational or medical purpose. However, I make it clear that such donations to wholly religious institutions and religious trusts will not be covered by the new provision." In the memorandum explaining the provisions contained in the Finance Bill, 2006 while dealing with the provisions relating to section 115BBC it has been stated that: "In order to tax unaccounted money being contributed to these institutions by way of anonymous donations, it is proposed to insert a new section 115BBC so as to provide that any income by way of anonymous donat....
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....' having religious faith in the mind. The appellant trust arranged the same in its campus of these items which helps in carrying out the object of the trust. In addition to this, the appellant trust's A/R also submitted that if anybody purchases these items value of exceeding Rs. 150/-, then the appellant trust issue receipt to such person, with details of name & address of such donor / visitors. Having considered the AO's order as well as the appellant trust's submission, I am of the considered view that the AO misunderstood the intention of the law, while applying the provisions of section 115BBC of the IT Act, 1961. This provision has not been brought on statute with the intention to check these type of donation of meager amount of Rs. 10/- to Rs. 150/-. I am of the considered view that this was nowhere intent of the law, besides this, even if, section 115BBC(2) of the IT Act, 1961 is taken into account. Thus the AO's action is considered unjustified and against the provision of law, the same is reproduced as under: Section 115BBC(2) "(2) The provisions of sub-section (1) shall not apply to any anonymous donation received by- (a) Any trust or institution created or establish....
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....of CIT (A) and in addition he submitted that the AO did not take into consideration the two important decisions cited before him. 9. We have heard the arguments from both the sides and also perused the orders of both the revenue authorities. 10. We are in agreement with the CIT(A) that the purport and purpose for bringing in section 115BBC is to curb the influx of unaccounted money by way of anonymous donations towards educational trusts and other religious trusts and certainly not to curb any and all types of donations / offerings either in temples, muths and religious trusts, where the collections are collected in donation boxes and that too ranging from as low as Rs. 10/- to Rs. 150/-. 11. From the order of the CIT (A), we find that the assessee is running veterinary hospital for treatment of wounded and sick animals and birds. If we strictly accept the submissions of the DR, then we must also accept situations where we will find wounded and dead animals on the roads, in open, and at houses, rotting, spreading foul smell and diseases. Therefore, accordingly, the DR would accept a situation like this. We find that this trust has been in existence for the last 176 years, doing ....