AI Drafter 
TaxTMI 
TaxTMI 
2018 (12) TMI 1552
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....that the assessee is an ongoing entity and has been in operation for nearly 40 years. The appellant-society filed application before the CIT (E) for registration u/s 12A of the Act so as to be able to claim exemption u/s 11 of the Income-tax Act, 1961 (in short 'the Act'). It has been further submitted by the Ld. Counsel for the assessee that the Ld. CIT(E) rejected the application of the appellant assessee mainly for the reason that there was no dissolution clause in the Memorandum of Association ('MOA') / Trust Deed of the appellant assessee. The Ld. CIT(E) observed that in case of trust / society established for charitable or religious purposes, the income or any property of such trust or institution should be applied for such purposes only and that no part of income or any property of trust or the society should be used or applied directly or indirectly for the benefit of any person referred to in sub section (3) of section 13 i.e. the author of the trust or founder of the institution, any family member of such author or founder, any trustee of the trust or manager of the institution, any relative of such author or founder person or member trustee or manager and even an....
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....172-2740303 'SRI DASMESH ACADEMY TRUST No.SDA/Trust H.No. 60, Sector -5, Chandigarh No. SDA.MOA/2018 05 Feb 2018 To The Registrar, Registrar of Firms& Societies Punjab, Sectro 17, Chandigarh Sub:- ADDITON/ AMENDMENT TO "MEMORANDUM OF ASSOCATION" SRI DASMESH ACADEMY TRUST 1. Reference discussion held in your office in Jan 2018 on the subject 2. Following Registers containing Minutes of Board of Governess Meeting held since 1978 onwards are sent herewith addition desire:- 3. (a) Registrar containing Board of Governors Meeting from Ser No. 01 to 06. (b)Register containing Board of Governors Meeting from Ser No.07 to 19. 2. Last Meeting of Board of Governors was held on 15 May 2007 (MS-3) 3. Term of "Board of Governors was NOT extended further by the Members of the Dasmesh Trust. 4. During the meeting of Member of Sri Dasmesh Academy Trust held on 17 July 2017, under the Chairmanship of Sardar Parkash Singh Badal, it was decided to Add the amendment to Memorandum of Association vide Sub Hed (Item No. III) of the Minutes, Copy of Minute....
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....y instrument or transact any business of the Trust, any person as attorney of Trust with such powers as they may deem fit; (ix) to enter into any agreement Central Government or State governments for receiving grants. (x) to raise and borrow money on bonds, mortgages, promissory notes or other obligations or securities founded or based upon all or any of the properties and assets of the Trust or without any securities and upon such terms and conditions as they may think fit; (xi) to make, draw, accept, endorse and negotiate the Central Government and other promissory notes, bills, cheques or other negotiable instruments; (xii) to invest the funds of the Trust in or upon such securities as they may deem fit and from time to time transpose any investment (xiii) To make such rules and bye-laws as they may from time to time, consider to be necessary for regulating the management of the Academy and the affairs of the Trust; (xiv) to delegate all or any of its powers to the Governing Body or to anyone or more members of its body of its officers; and (xv) to do all such other sets and things as may be requisite in order to fur....
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....jab Defence & Security Relief fund Committee 4. Three Administrative Secretaries of Punjab Govt. (Education, Finance and Defence Services Welfare Deptt) as ex-officio Members 5. Two eminent educationists to be nominated by the Trust 6. Secretary of the Trust as Hony. Member Secretary of the Governing Body and 7. Director of the Academy. We the several persons, whose signatures, occupations and addresses are given hereunder, are desirous of being formed into an Association in accordance with the provisions of the Societies Registration Act, 1980, in pursuance of this Memorandum of Association and in testimony of this, we have subscribed our respective names and signatures hereto on the day of August in the year 2017 at Chandigarh. 1. S.Parkash Singh Badal Son of late S. Raghuraj Singh Vill & PO Badal Distt. Muktsar to generate Signature digitally. 2. S. Surjit Singh Rakhra S/o Sh. Kartar Singh Rakhra Palace, Patiala to genera....
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....gh Rakhra S/o Sh. Kartar Singh, Rakhra Palace, Patiala 3 S. Balwinder Singh Bhundar,M.P. Kothi No.256,Sector 11-A, Chandigarh 4 Air Marshal Manmohan Singh (Retd), PVAS, AVSM, Vr C, S/o S.Iqbal Singh, Kothi No.198, Sector 18A, Chandigarh 5 GP Capt Amarjeet Singh Gerewal, FRGS (Retd) S/o S.Dalip Singh, H.No. 5782, Duplex Modern Housing Complex, Manimajra (UT), Chandigarh 6 Dr Jasbir Singh Ahluawalia, IAS (Retd), S/o S.Kartar Singh Ahluawalia Kothi No. 1607, Sector 33, Chandigarh 7 S.Amarjeet Singh Sandh, IAS (Retd), S/o S.Gurbax Singh, 17-B, Model Town, Patiala 8 Smt.Satwinder Kaur Dhiliwal, Ex.MP, Kothi No. 965, Phase IV, SAS Nagar, (Mohali) 9 Mr Vishal Singh, S/o S. Satnam Singh, Kothi No.502, Sector 10-C, Chandigarh 9. Surprisingly, the said 'MOA,' whereby, the four persons as mentioned above have been decided to be admitted as members of the trust and who have put their signatures against their names conveying their consent for admitting them to membership of Trust, are themselves signatory of the said amended resolution. The fact on the file revels that the said resolution is not a valid resolution as the persons ....
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.... ix) to enter into an agreement with Central Government or state Governments for receiving grants; x) to raise and borrow money on bonds, mortgages, promissory notes and other obligations or securities founded or based upon all or any of the properties and assets of the Trust or without any securities and upon such terms and conditions as they may think fit; xi) to make, draw, accept endorsee and negotiate the Central Government and other promissory notes, bills, cheques or other negotiable instruments; xii) to invest the funds of the Trust in or upon such securities as they may deem fit and from time to time transpose any investment. xiii) to make such rules and bye-laws as they may from time to time, consider to be necessary for regulating the management of the Academy for the affairs of The trust; xiv) to delegate all or any of its powers to the Governing body or to anyone or more members of the its body or its officers; and xv) to do all such other acts and things as may be requisite in order to further the objects of the Trust. 4 (a) the signatories to this Memoraudum of Association may admit to the membership of the ....
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....A, Panaji 4 Air Chief Marshal Arjan Singh 7-A,Kautiyla Marg, New Delhi 5 Lt Gen Gartaj Singh, Kothi No. 80,Sector 5, Chandigarh 6 Sh. Balawant Singh, Finance Ministry, Punjab 7 Yagna Datt Sharma, M.P. 30, Dr.Rajendraprasad Road New Delhi 8 Dasant Singh Khalsa,M.P. 22, Westorn Court, New Delhi 9 Ravi Inder Singh, Speaker, PunjabVidhan Sabha, Chandigarh 10 Ajit Singh Sarhadi, Advocate General, Punjab Chandigarh 11 Maj.Gen A.K.Luthra, 32, Sector 4, Chandigarh Sd/- Witnesses" 11. Alongwith the said 'MOA' of 1978, there is attached amended Regulation, which reads as under:- "AMDNDED REGULATION GOVERING BODY 1. The Management of the affairs of the Sri Dasmesh Academy Trust will be entrusted to a Board of Governor, hereinafter referred to as 'The Board. 2. (a) The Board shall comprise of the following members:- 1 Chief Minister, Punjab Chairman Sd/ 2 Four member from amongst the Trustees to be elected by themselves Members Sd/ 1. Chief Minister, Punjab Chairman Sd/ 2. Four members from amongst the Trustees to be elected by....
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....d of the Educational Institution and other teaching staff, to fix their grade of pay, emoluments and other terms and conditions of service, to suspend, remove, dismiss or otherwise punish any officer of servant so appointed and to abolish any post when in the opinion of the trust it is no more required. POWERS AND DUTIES OF THE CHAIRMAN OF THE BOARD. 6 (a) The Chairman shall have power to convene meetings of the Board at any time when he considers it necessary. (b) In an emergency, which, in the opinion of the Chairman requires that immediate action should be taken, the Chairman shall take such action as he deems necessary but shall report his action to the Board at its next meeting. (c) The Chairman shall exercise such other powers as may be delegated by the Board. (d) In the absence of the Chairman, at any meeting of the Board, the Members present shall select one from amongst themselves to preside at the meetings. POWERS AND FUNCTIONS OF THE MEMBER SECRETARIES. (a) The Member Secretary of the Trust shall be the Chief Administrative officer of the trust and be responsible for the setting up of the entire campus and ca....
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....members so the Trusts and the Board will be reimbursed by the Trust and the Academy their travelling allowance in respect of the journey undertaken to attend such committees thereof, or in connection with the business of the Trust and the Academy as may be provided in the rules to be made in this behalf by the Trust and the Board. Non-official Members shall not be entitled to get any other remuneration. 12 The trust and the Board shall cause regular accounts to be kept of all its moneys and properties and to have them audited by qualified auditors. 13 Such other matters as have not been provided for above will be regulated by rules to be made by the Trust. It is certified that this is a true copy of the Regulations' of the Trust. Sd/- (Parkash Singh Badal) Chairman Sri Dasmesh Acadmy Trust. Sd/ AIR chief marshal ARJAN SINGH Member, Sri Dashmesh Academy Trust Sd/- Sardar Basant Singh Khalsa Member, Sri Dashmesh Academy Trust Major General Sd/- A.K. Luthera Member, Sri Dashmesh Academy Trust" 12. It is pertinent to mention that the said clause 4 (e) till date has not b....
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....structed from the 100% finances obtained from the Government of Punjab and Ministry of Defence, Government of India. Even it has been further mentioned that the corpus fund was contributed initially at the time of incorporation by the Punjab Government to the tune of Rs. 2,00,00,000/- and by the Punjab Defence and Security Relief Fund Committee of Rs. 70,00,000./-. It has been further claimed that the trust has been 100% financed by the Government. Further, in the letter dated 16.2.2017 addressed to the ACIT (Exemptions) it has been further claimed by the assessee society that the entire capital cost (100%) of the school / academy met by the Ministry of Defence and the Government of Punjab and further they send regularly the grants for all specific needs to meet capital or Revenue expenditure of the trust. That since the "said trust is baby of the Central and State Government" (emphasis supplied by us) and most of the governing body members are Ex-officio members viz. Chief Ministers of Punjab, one Member of Punjab Defence & Security Committee, three Administrative Secretaries of Punjab Government (Education, Finance & Defence) etc, and, therefore, it has been claimed that the trus....
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....The assessee claims deductions u/s 10(23C)(iiiab) of Income Tax Act since it is 100% financed by Govt. 12. The details of cash deposits in bank for a period from 08.11.2016 to 31.03.2017 the deposits pertains to the fee of the students. 13. The salary details for the last three years are attached as Armexure 'E' along with the deduction of TDS. 14. The copies of financial statements for the last 3 years are attached as Annexure 'F'. 15. No donation has been received during the Asstt. Year 2016-17. 16. The trust is pi-rely and educational institute. 17. The assessee has filed application u/s 11&12 in 1981, being explained earlier in para No. 7. 18. The copy of the Asstt. Orders u/s 143(3) of Income Tax Act for the Asstt, Year2012-13 is attached as Annexure 'G'. 19. There is no branch of the trust. I hope the documents and information are in order. Thanking you Yours Sincerely, Sd/- (CA. SANJEEV -MEHAN) For & on behalf of Assessee "16th June, 2017 The Asstt. Commissioner of Income Tax (Exemptions) CHANDIGARH ....
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....hat in case of the dissolution of the trust/society it shall be taken over by any other society with similar object or the Govt shall have the right to take it over". 8. Now the government advised trust to be self-sufficient without the Govt grants and thus a need has been arisen to get the trust registered u/s 12AA of Income Tax Act. In view of the above it is hereby prayed that the trust be registered u/s 12AA of Income Tax Act. Thanking you Yours sincerely, Sd/- (CA. SANJEEV MEHAN) For & on behalf of Assessee" 14. However, in the letter dated 5.2.2018 addressed to the Registrar of Firms and Societies, it has been mentioned that the last meeting of the Board of Governors was held on 15.5.2007 and thereafter the term of Board of Governors was not extended further by the members of 'Sri Dashmesh Academy Trust'. The above contents of the letter dated 05.2.2018 reveals that there is no Board of Governors formed after 15.5.2007 and even the intimation regarding the above is given to the Registrar, Firms and Societies after 11 years i.e. vide letter dated 5.2.2018, only when the Trustees got awaken up to add the....
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.... Income Tax (E) vide letters dated 12.6.2017 and 16.6.2017, it has been pleaded that the land to the Trust has been allotted by the Government of Punjab by way of Special Gazette Notification. That the assessee Trust was formed by Ministry of Defence and Government of Punjab to educate the children of serving and Ex-Defence personnel and the poor children of the area. That the trust receives / received grants from the Punjab Govt. and Ministry of Defence. That the assessee has been claiming deduction u/s 10(23C) (iiiab) of the Income Tax Act since it is 100% financed by the government. That the entire capital cost (100%) of school / academy has been met by Ministry of Defence & Government of Punjab and further that they regularly send the grants for all specific needs to meet the capital and Revenue expenditure. That the trust has not been accepting any grants or donations from the other parties, except at one time SGPC has sent certain grant for specific capital expenditure. That the trust is 100% financed by the Central and State Government. It has also been pleaded in the letter dated 16.6.2017 that the trust is baby of the Central and State Government and the most of the Govern....