TaxTMI 
TaxTMI 
2018 (2) TMI 1358
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....genuine; (ii) that Activities of the assessee trust are carried out in accordance with the objects declared in the deed of trust; (iii) that the assessee trust has received corpus donation of Rs. 25,00,000/- genuinely through cheque on 29.03.2011, which is supported by proper document it was accounted for in the accounts dully audited as per the provisions of the Income Tax Act, 196 I; (iv) that the accounts itself reveal that the said donation had not returned either in cash or through web of financial transactions after retaining commission as alleged in the so called deposition made under the oath by one Shri S.R. Dasgupta, Director of an assessee "M/s. Herbicure HeaIthcare Bio-Herbal Research Foundation" and returned in the course of survey operation conducted on 27.01.2015 by the Investigation wing of the I.T. Department at the office cum research premises of the said Research Foundation. (v) that the statement of the alleged deponent is vague, general and hypothetical without identifying or mentioning any particular donee for acceptance of donation and return thereof through web of financial transaction and acceptance of any money by cash o....
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....hich were subsequently forwarded in cash / cheque through the web of financial transactions after involving the layer of middleman. Now coming to the case in hand, the assessee was paid a donation of Rs.25 lakh from HHBHRF in the previous financial year 2010-11 corresponding to Assessment Year 2011-12. Accordingly, Ld. CIT(Ex) observed that the activities of the assessee are not genuine as it is engaged in money laundering activities. Thus, Ld. CIT(Ex) proposed for cancellation of certificate granted u/s 12AA of the Act and accordingly issued show cause notice dated 02.11.2015. In compliance thereto, assessee submitted that Shri Swapan Ranjan Das Gupta, Director of HHBHRF in his statement furnished u/s 133A of the Act nowhere mentioned that the donation paid to assessee is bogus. There is no evidence found during the survey proceedings u/s 133A of the Act suggesting that the amount of donation for Rs.25 lakh received by assessee is bogus / fictitious. Thus, in the absence of any corroborative evidence no inference can be drawn against the assessee merely on the basis of the statement. The amount of donation was received by assessee through banking channel and same was duly accou....
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....the registration of such trust or institution" The matter being so, the registration already granted under section 12AA con be cancelled only under two specific circumstances. namely: (i) the authority is satisfied that the activities of such trust or institution ore not genuine, and (ii) the authority is satisfied that the activities of the assessee cue not being carried out in accordance with its declared objects. In the instant case of activities of the Society are found to be not genuine and the activities of the Society are not 0$ per objects of the trust. Money laundering trough receipts of research contributions and repaying them in cash through bogus; expense were never the Objects of the trust and hence found to be ingenuine and illegal activity. 7. Conclusion: 7.1 The intention of the legislature to grant registration u/s.12AA and 80G, to give the benefit u/s.11 to encourage medical relief to the poor ad needy persons, promote education among masses and support to the poor section of the society. But time and again these provision have been misused for personal need and for benefit of trustees/members of the trusts and societies. In the....
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....is not volu9ntray, merely an accommodation entry and factitious. Therefore, the claim of exemption u/s. 11(1)(d) was not absolutely tenable. g) Activities of the society are not genuine as well as not being carried out in accordance with its objects. h) Even ingenuine and illegal activities carried on by assessee through money laundering do not come within the conceptual framework of charity vis-à-vis activity of general public utility envisaged the Income Tax Act as laid down in Section 2(15). 8. Keeping in view the above, provision of Section 12AA(3) is invoked and registration granted u/s. 12AA is withdrawn/cancelled w.e.f. 01.04.2010 from the starting of financial year, the year the society was found to be involved in money laundering through receipt of bogus donation, ingenuine activities and not carrying out activities as per object of the trust. Aggrieved by this, the assessee has come up in appeal before us. 5. Ld. AR for the assessee filed paper book which is running from pages 1 to 51 and cited a few Tribunal's order and stated that managing trustee of HHBHRE has clearly admitted in his statement furnished u/s 133A of the Act that i....
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.... our attention to the fact that in the said statement the founder director had specifically referred to a period from which bogus donations were received by HHBHRF viz., after A.Y.2010-11.He drew our attention to the fact donation was given to the assessee by HHBHRF through cheque dated 03.03.2011 which was admittedly prior to the period in which bogus donations were received by HHBHRF. According to him the statement recorded at the time of survey based on which the impugned order was passed was not incriminating, so far the assessee is concerned. According to him therefore the very basis on which the impugned order has been passed by the Ld. CIT(Ex), Kolkata is unsustainable. His next submission was that there was no other incriminating material on the basis of which it can be concluded that the assessee gave cash and in return got donation of Rs. 5 lakhs and it was the assessee who arranged through the brokers for getting bogus donations. It was also his submission that there is no evidence of the assessee having indulged in money launderings. The assessee brought to our notice that assessee has been carrying out charitable activities. 13. According to the ld. AR, the ld....
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....prior to 31.03.2011 there is no reference to such donations given or received by HHBHRF being in the nature of bogus donations. The assessee had received the donation from HHBHRF on 03.03.2011. It is therefore not possible to place reliance on the statement recorded at the time of survey and come to a conclusion that the assessee has been indulging in money laundering. 16. In answer to question no.23 Shri Swapan Ranjan Dasgupta founder director of HHBHRF has made reference to certain middle men who are engaged in money laundering using HHBHRF as a medium for money laundering. There is no evidence brought on record to show any connection between those brokers and the assessee. In the absence of such corroborative evidence, it is not possible to come to any conclusion that the assessee indulged in money laundering and that the donation received by the assessee from HHBHRF was a bogus donation. In fact on identical facts this Tribunal in the case of Sri Mayapur Dham Pilgrim and Visitors Trust (supra) came to the conclusion that cancellation of registration u/s 12AA cannot be sustained. In fact in the case of Sri Mayapur Dham Pilgrim and Visitors Trust (supra) the factual posi....