TaxTMI 
TaxTMI 
TaxTMI 
2021 (10) TMI 658
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....he year the assessee claimed deduction under Section 35(1)(ii) of the Act of Rs. 17,50,000/- by making a donation of Rs. 10,00,000/- to M/s. Herbicure Healthcare Bio Herbal Research Foundation at Kolkata and claimed deduction @ 1.75 times of the donation under Section 35(1)(ii) of the Act. The Assessing Officer confronted the assessee about the report of the Investigation Wing, who carried detailed enquiries at the premises of the donee and recorded the statement of its founders and trustees. Based on the report which shows that bogus donation of Rs. 253.06 crores was taken by above donee. Shri Swapan Ranjan Dasgupta, Director of the above trust have also confessed having accepted 5% commission for facilitating the bogus donation. Based on this information the Assessing Officer questioned the assessee. Copy of the statement of Mr. Swapan Dasgupta was also given to the assessee. The assessee submitted that it has produced the relevant information and certificates. Assessing Officer rejected the contention of the assessee and stated that name of the assessee figures at serial No. 239 of the list of beneficiaries prepared by the DGIT, Kolkata. He further held that the research organiz....
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....rity at the time of donation to the respective institutes for claiming of the deduction. The retrospective withdrawal and cancellation of the certificate will not have any impact upon the assessee, who has acted upon it when it was valid and operative. Therefore, he submitted that the orders of the lower authorities in denying the deduction claimed by the assessee under Section 35(1)(ii) of the Act of Rs. 17,50,000/- by giving a donation of Rs. 10,00,000/- to M/s. Herbicure Healthcare Bio Herbal Research Foundation are not sustainable. 6. The ld. DR vehemently supported the orders of the lower authorities. It was submitted that the donee itself has categorically stated that such donations are bogus, the beneficiaries are identified where the list of beneficiaries with their Permanent Account Number, the amount of donation are also annexed to the survey report. He submitted that the survey report itself shows that the beneficiary or bogus donor taken accommodation entries of more than Rs. 253 crores from the above foundation and Mr. Shri Swapan Ranjan Dasgupta, founder Director has accepted 5% of the commission for facilitating the bogus donation does not help the case of the asses....
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....ized of the matter of one of the trust which were covered in the survey report of the investigation wing Calcutta. Honourable Supreme Court held as Under:- "3. In a survey conducted on an entity named School of Human Genetics and Population Health, Kolkata under section 133A of the Act, it was prima facie observed that the Trust was not carrying out its activities in accordance with the objects of the Trust. A show cause notice was, therefore, issued by the CIT on 4-12-2015. 4. In answer to the questionnaire issued by the Department, Shri Rabindranath Lahiri, Managing Trustee of the Trust gave answers to some of the questions as under: "Q.11. Please confirm the authenticity of the abovementioned Corpus Donation. Ans. A major part of the donations that were claimed exemption u/s 11(1)(d) were not-genuine. The donation received in F.Ys. 2008-09, 2009-10 and 2010-11 were genuine Corpus Donation received either from the Trustees or persons who were close to the Trustees or persons who were close to the Trustees. In F.Ys. 2011-12 and 2012-13 a part of the donation were genuine like the earlier years. However, a major part of the donations received in these two F.Ys. viz. 2011-12....
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....on-I" and "Donations-II" having total amount of Rs. 6,03,07,550/- is bogus and out of which Rs. 5,96,29,973/- was returned back through RTGS to the above mentioned seven (7) persons following the instructions of the mediators." 5. On the basis of the material on record, the CIT came to the following conclusions: "6.1. The intention of the legislature to grant registration u/ss 12AA and 80G, to give the benefit u/s 11 to encourage medical relief to the poor and needy persons, promote education among masses and support to the poor section of the society. But time and again these provisions have been misused for personal need and for benefit of trustees/members of the trusts and societies. Survey u/s. 133A conducted in the case of assessee elaborates the nature and volume of transactions in the alleged activities. 6.2. Looking at the volume and depth of the illegal activities performed and indulged by the society to use the provisions of the I.T. Act providing support and encouragement to the organizations for doing the benevolent activities, assessee society not only opened the pandora's box defying the sole benevolent purpose of provisions as per the I.T. Act, but also cha....
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....porate bodies as well as from individuals. In the said statement it was explained that there were about nine brokers who used to bring donations in the form of cheque/RTGS to SHG and PH. The Donations received would be returned by issue of cheque/RTGS in the name of companies or organization specified by the nine brokers. SHG and PH would receive 7 or 8% of the donations amount. It was also stated in such statement since the assessee was entitled to exemption u/s 80G and u/s 35 of the Act their organization was chosen by the brokers for giving donations to SHG and PH as well as for giving donations by SHG and PH. Till now the Assessee's name did not figure in the statement recorded on 27-1-2015. However, pursuant to the Survey in the case of SHG & PH proceedings for cancellation of registration u/s 12A of the Act granted to them were initiated. In such proceedings, Smt. Samadrita Mukherjee Sardar (in a letter dated 24-8-2015) had given a list of donations which were given by them after getting cash of equivalent amount. It is not disputed that the name of the assessee figures in the said list and the fact that SHG & PH to the Assessee were against cash received from them in Fin....
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....horities cited before the adjudicating bodies below, we say that the respondent revenue has not been able to establish the case so as to warrant cancellation of the registration of the appellant trust under section 12AA(3) of the Act. The respondent also has not been able to prove any complicity of the appellant trust in any illegal, immoral or irregular activity of the donors. In that view of the matter, we answer the question (i) in the order dated 4th July 2018 in the negative and in favour of the assessee. We have not found it necessary to go into the issue raised in question (ii). The order of cancellation of the registration of the trust is set aside. The respondent is directed to restore its registration within three weeks of communication of this order. However, this will not bar any action against the appellant in respect of any future activities. The appeal is hereby allowed to the extent above." 10. In this appeal, we have heard Mr. N. Venkataraman, learned ASG in support of the appeal and Mr. Rana Mukherjee, learned Senior Advocate for the Trust. It is submitted by the learned ASG that the answers given to the questionnaire clearly show a definite tendency on ....