TaxTMI 
TaxTMI 
2021 (8) TMI 421
X X X X Extracts X X X X
X X X X Extracts X X X X
....o be applied on aims and objects of the trusts in revenue and capital account. The registration under s.12AA(1)(b) of the Act was granted to the assessee on 07.11.2007 to enable the assessee to avail the concessions and tax benefits available to charitable trust. However, a show cause notice under s.12AA(3) of the Act dated 13.06.2018 was issued to the assessee seeking to withdraw the registration so granted in the light of the assessment order passed by the AO under s.143(3) r.w.s. 147 of the Act dated 28.12.2017 concerning A.Y. 2011-12 and consequent report of the AO to the CIT(E). 3.1 As per the show cause notice, the CIT(E) alleged receipts of ingenuine donation from Herbicure Healthcare Bioherbal Research Foundation (HHBRF) and Sethi Trust aggregating to Rs. 70 Lakhs. Accordingly, the status of the assessee as trust was sought to be revoked to deny the benefits under s.11 of the Act by cancellation of registration of trust granted under s.12AA of the Act. 3.2 Not satisfied with the written and oral submissions made on behalf of the assessee in its defense, the CIT(E) passed an order under s.12AA(3) of the Act whereby it was concluded that the activity of the assessee is ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....f Central Excise (2015) 281 CTR 0241 (SC). It was thus contended that the action of the CIT(E) is a nullity and a complete non-starter having regard to the serious breach of violation of principles of natural justice. 5.4 It was further contended that no independent enquiry was made and no evidence was brought on record by the CIT(E) while taking the drastic action against the assessee of cancellation of registration with retrospective effect. No attempt was made to show any connection between the donor trust or so called broker and the assessee trust. No corroborative evidence was brought on record while coming to a harsh conclusion alleging indulgence of assessee trust in money laundering and receiving bogus donation. The CIT(E) further failed to take note of the fact that donor HHBRF was having sufficient creditworthiness showing receipt of Rs. 16.01 Crore out of which a donation of Rs. 65 Lakhs was parted with the assessee trust to promote pious charitable activities. It was further pointed out that the donor Sethi Trust was having total receipt of Rs. 3.59 Crores out of which donation of Rs. 5 Lakhs was given to the assessee trust. These facts when taken into account wou....
X X X X Extracts X X X X
X X X X Extracts X X X X
....er dated 24.09.2010. 5.8 As regards the other donor, namely, Sethi Trust, it was submitted that no reference has been made to any trustee of the trust adverse to the assessee. 5.9 The learned counsel accordingly urged for reversal of impugned cancellation order and restoration of registration certificate. 6. The learned DR for the Revenue, on the other hand, submitted that the impugned cancellation order dated 28.12.2018 is self-explanatory and he thus sought to rely thereupon. In furtherance, the learned CIT-DR pointed out that the activities of the assessee trust are clearly not genuine in the light of bogus donation of Rs. 65 Lakhs received from HHBRF and Rs. 5 Lakhs from Sethi Trust parties totaling to Rs. 70 Lakhs in F.Y. 2010-11 relevant to A.Y. 2011-12. The learned DR accordingly submitted that the registration to the assessee trust could not continue in the light of the ingenuine activities detected and consequently, the CIT(E) has rightly withdrawn and cancelled the registration granted under s.12AA of the Act and consequently to deny the tax benefits available under s.11 of the Act. 7. We have carefully considered the rival submissions and perused the material....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ceived bogus donation of Rs. 65 lakhs from HHBRF and Rs. 5 Lakhs from Sethi Trust aggregating to Rs. 70 Lakhs in AY 2011-12. The solitary allegation labeled by the CIT(E) is primarily based on assessment order dated 28.12.2017 under s.143(3) r.w.s. 147 of the Act passed by the AO. ii. The allegation of receiving the bogus donation is only and only based on some non-descript and vague information received by the CIT(E), Kolkata vide letter dated 28.10.2015 in respect of donors as evident from the cancellation order. This information received by the department from its counterpart led to reassessment for A.Y. 2011-12 to deny tax benefits available under s.11 of the Act. The addition in the re-assessment proceedings for A.Y. 2011-12 was primarily made on the basis of statement of one of the Directors HHBRF recorded under s.133A of the Act by Investigation Wing, Kolkata in the course of survey proceedings on the donor. Such a vague and non-descript statement and that too recorded under s.133A of the Act does not carry any evidentiary value, in the absence of any tangible evidence to corroborate the assertions made against the deponent in the light of the decision of the Hon'bl....