AI Drafter 
TaxTMI 
TaxTMI 
2018 (3) TMI 887
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....Act. 3. Briefly stated the facts, are that, the assessee in the present case is a trust and engaged in the activity of providing medical facilities. The trust was created on 7th December, 1987 with the main object to provide medical facilities through the construction of building and running & maintaining of hospitals / Nursing Homes / Health Centers either at its own or through other trust, societies or institution etc. Subsequently, the assessee was granted certificate of registration under Section 12A of the Act by the Commissioner of Income Tax (Exemption) vide order no. CIT-VI / TE (207) / 88 / 1391 dated 27th December, 1988. Similarly, the assessee was also granted registration certificate under Section 80G(5)(vi) of the Act by the DIT (Exemption) vide order dated 25.11.2008. The registration certificate under Section 80G(5)(vi) was applicable from assessment year 2009-10 onwards and the same is valid till it is cancelled. 4. The trust was created under the legal obligation imposed by the Haryana Government in connection with the allotment of land to DLF Limited (formerly known as DLF Universal Limited). It was directed by the Haryana Government to provide the medical f....
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....ruction of the hospital. All the activities carried out by the assessee are in pursuance to the objects permitted in the trust deed and there was no alternation / modification in its object clause since the inception of the trust. However, the AO disregarded the contention of the assessee by observing that the assessee is not carrying out any charitable activity and accordingly, the exemption claimed by the assessee under section 11 & 12 of the Act was denied to the assessee. 11. Aggrieved assessee preferred an appeal to learned CIT(A). The assessee before the learned CIT(A) submitted that the assessee has been claiming exemption under Section 11 and 12 of the Act since the inception of the trust and it was not denied till date except in the assessment years pertaining to 1991, 1992-93, 1994-95, 1996-97, 1997-98 and 2002-03. But subsequently it was allowed by the higher appellate authorities including the Hon'ble Delhi High Court in the own case of the assessee. 12. All the activities were carried out by the assessee in terms of its object as specified in the trust deed dated 7th December, 1987. As per the object clause, the land was given to the outsiders for medical activit....
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....s shall also be held for the same object" It is now to be analysed and considered, whether the activities of the trust have been within the above defined parameters. In this context, it is imperative to mention and note that at no time after the original trust Deed was formulated and registration granted u/s 12A in the year 1988, the objects of the trust have been neither altered nor amended nor substituted. It is also an admitted fact on record that the activities of the trust as stated above, have been tested at various judicial forum including High Court of Delhi and have successfully stood the test of appeal, as stated herein above. I have perused the Trust deed and have no hesitation in agreeing with the appellant and in stating that clause clearly gives the power to the Trustee for leasing/sale of the medical sites to other persons, trusts, societies or institution for providing medical facilities to the persons residing in DLF City, Gurgaon. It is observed that the main reason for the Assessing Officer to conclude that the appellant was not carrying out the charitable activity, was that it was not running itself any hospital, etc. However, as expla....
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....s Association [1980] 121 ITR 1 (SC) ii. Sole Trustee, Laka Shikshana Trust vs. CIT [1975] 101 ITR 234 (SC). iii. American Hotel & Lodging Association, Educational Institute v. CBDT [2008] 301 ITR 86 (SC). iv. CIT vs. Andhra Chamber of Commerce, (1964) 55 ITR 722, 729 (SC). make it abundantly clear that income derived by Appellant Trust from any sources, is utilized or accumulated for carrying out the object of the trust of charitable activities, exemption U/s 11 & 12 cannot be denied to the appellant's Trust. Consequently, on facts, in law and deriving support from the judicial decisions (Supra), I have no hesitation in direction the Assessing Officer to allow the appellant Trust the benefit of exemption U/s 11 & 12 of the Act." 15. Being aggrieved by the order of the learned CIT(A), Revenue is in second appeal before us. The learned DR before us submitted that the activities of the trust are not charitable in nature therefore the benefit of exemption under Section 11 cannot be given to it. The learned DR in support of his claim relied on the order of Hon'ble Delhi Tribunal in the case of Devki Devi Foundation vs. DIT (Exemption) reported i....
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....that the Tribunal had correctly appreciated the law and has come to the conclusion that the respondent assessee was entitled under Section 11(5)(x) to invest in immovable property out of the funds which were surplus with it. The Tribunal has also concluded that there was no evidence on the part of the department that the assessee had applied the rent received from the commercial property for non-charitable purpose. That being the case, the registration under Section 12A could not have been cancelled. We do not find any substantial question of law which arises for our consideration." 17. The learned AR vehemently supported the orders of the learned CIT(A). 18. We have heard the rival contentions and perused the materials available on record. In the instant case, the benefit claimed by the assessee under Section 11 / 12 of the Act was denied by the AO on the ground that the activities of the trust were not chargeable in nature. 18.1 It is undisputed fact that there was no change in the object clause of the trust since its inception. On the basis of same objects Clauses, the trust was granted registration under Section 12A / 80G of the Act. The assessee during the year has so....
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.... the Hon'ble ITAT in the group case of the assessee has decided the issue in favour of assessee in the identical facts and circumstances in ITA No. 57/Del/2013 in the case of ITO vs. DLF Qutub Enclave Complex Educational Charitable Trust vide order dated 20-8-2014. The relevant extract of the order is reproduced below:- "We find that this issue before us is no longer res-integra. The coordinate Bench in the case of the assesse for assessment year 1994-95 has held that the assessee is entitled to exemption u/s 11 & 12 of the Act. It was held that letting out the school building was aimed at providing assistance in imparting education, which is undisputably for a charitable object. It was held there as under:- In view of the above decision, the assessee trust was justified in letting out the school building to the other educational trust and, therefore, it can be said that the leasing activity as well as the income earned through such activity was in furtherance of the objects and ideals of the trust. The leasing activity was also aimed at providing assistance in imparting educational which was undisputedly a charitable object. Thus, the finds of the Id CIT(A) are t....