TaxTMI 
TaxTMI 
2021 (11) TMI 380
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....enuineness of the activities carried out by the Trust in the applicant is not engaged in any charitable activity as such despite the fact that all relevant material was placed before him and thus the order being prejudiced and biased against all settled principles of law may kindly be ordered to be set aside and Registration granted to the appellant Trust. 2. On the facts and in the peculiar circumstances of the preset case the Ld. CIT was not at all justified in falsely holding that no books of accounts, vouchers or evidence of charity could be provided by the appellant Trust despite the fact that comprehensive reply along with all supporting material was duly placed before him and despite this the Ld. CIT has passed an order which is against the material available on record in a biased manner which is proved from the fact that on both the hearings i.e. 05-7-2018 and 08-08-2018, complete replies were filed and all relevant details provided as required but still the order was passed without even confronting as to which detail was not available or could not be supplied by the appellant Trust and thus the order is bad in law and void ab-initio and thus may kindly be ordered ....
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....such despite the fact that all relevant material was placed before him and thus the order being prejudiced and biased against all settled principles of law may kindly be ordered to be set aside and Registration granted to the appellant Trust. 2. On the facts and in the peculiar circumstances of the preset case the Ld. CIT was not at all justified in falsely fixed neither anybody attended nor any application for adjournment was filed. A reply was sent through speed post on 10-01-2019 which was received in the office of the CIT on 14-01-2019 which has been fully ignored. Through this reply it was informed that a comprehensive reply alongwith all its supporting documents are already in the records of Department, which were filed through letters dt.05-07-2018 and 08-08-2018 and accounts books were also produced on these dates. Still the order in question has been passed after ignoring the replies and complete records available with the Department, thus the order is bad in law and void ab-initio and thus may kindly be ordered to be quashed and Registration granted. 3. That the Ld. CIT failed to appreciate that the objects and the activities of the appellant Trust are c....
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....d for the various expenses with respect to various activities as claimed to have been carried out; that no bank statement had also been provided for verification of the activities of the Trust and so, the genuineness of the activities could not be verified; that no charitable activity had been carried on by the applicant and it had been doing a mere pretense of charity; that the applicant had failed to prove the genuineness of the activities which it claimed to have been carrying on; that in the Memorandum of the Trust, there were several objects; that however, failure of the applicant to corroborate them with satisfactory evidences placed fatal allegation on the genuineness of the activities of the applicant; that this clearly proved that the applicant had done a false declaration with respect to the objects set out in its Memorandum and it was not actually working towards their attainment; that therefore, the activities of the Trust were not in tandem with its Memorandum; that mere recital of the objects or activities without cogent or corroborative evidence was not sufficient by itself to enable the registering authority to arrive at the satisfaction mandated by law; that the ap....
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.... applicant's books of account and vouchers, which were duly produced before the ld. CIT (E); that so much so, that during the proceedings before the ld. CIT (E), he never expressed any doubt, nor raised any query in this regard; that the applicant is a newly formed Trust and as such, the genuineness of its activities is to be examined with reference to its objects and proposed activities, as held by the Hon'ble Supreme Court in the case of 'Ananda Social & Educational Trust vs. CIT' 426 ITR 340 (SC); that concerning the objection that the applicant had provided only its Trust Deed and no material which could throw some light on the applicant's activities, the afore-stated material constituted enough material concerning the activities carried out by the applicant; that this being so, the genuineness of the activities of the applicant ought not to have been doubted by the ld. CIT (E); that the ld. CIT (E) further erred in observing that the factum of the applicant's Memorandum containing several objects, in the absence of supporting material to corroborate them, was fatal to the genuineness of the activities of the applicant, proving that the applicant had made a false declaratio....
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.... accordance with its objects; that therefore, the impugned order is unsustainable in law, requiring to be cancelled; and that the applicant, in these facts and circumstances, be granted registration, as claimed. 4. Per contra, the ld. D.R. has placed strong reliance on the impugned order. It has been contended that as noted by the ld. CIT (E), the applicant miserably failed to provide sufficient material to corroborate and prove the claimed charitable nature of its objects and the genuineness of its activities; that despite having been provided timely opportunity, the applicant had remained unable to substantiate its claim; that as such, the order under appeal is a well-reasoned order, requiring no interference at all; and that therefore, the appeal of the applicant be ordered to be dismissed. 5. We have heard both the parties and have perused the material on record. The records of this case, as before the ld. CIT (E) were called for. They have been examined by the ld. D.R., as reported to us by her in the course of the virtual hearing. 6. The following Questionnaire (APB:24 & 25) dated 22.5.2018 was issued to the applicant-appellent: 7. The first objection made by the ....
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....t, i.e., the second party to the Trust Deed, that is the lessee, from Dr. Ashok Kumar Agarwal, that is, the first party thereto, or, the lessor. This explicit recital and stipulation is a stark direct contrast in black and white, to the illegal surmisical and conjectural speculation of the ld. CIT (E) that there would be any option available to the applicant-Trust-lessee to transfer the land with the construction thereon, back to the lessor, at the termination of the lease. This observation of the ld. CIT (E) is, therefore, but a result of complete non-reading of the material evidence brought on record by the applicant before the ld. CIT (E), in the shape of the concerned Lease Deed. 9. In item no.20 (APB:25), the Questionnaire states "please produce the copy of the bank statement/passbook as on date". In response, vide item no.20 (APB:27) of its Reply dated 5.7.2018, the applicant stated that "the Bank Statement is enclosed". 10. The ld. CIT (E) has next objected that the applicant failed to showcase the books of account, the vouchers and bank statement. In this regard, item no.21 (APB:27) of the Questionnaire states as follows: "Please produce all relevant papers/d....
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.... "3) We are carrying on an educational institution at Meeranpur Katra, Distt. Shahjahanpu. At present we are running classes Nursery to class VIII and it is projected that year by year we will extend it to class XII." 16. Then, in paragraph 24 (APB:27) of the said Reply, it was stated that since it is the first year, only building construction was in progress and during financial year 2017-18, the education activities have been performed. 17. Further, the activities of the applicant are also evident from the applicant's audited accounts for the years ended in 2016-17 (APB:19-23) and 2017-18 (APB:77-82). It is also remarkable, as contended on behalf of the applicant, that during the proceedings before the ld. CIT (E), he did not show any dissatisfaction, nor expressed any doubt, nor raised any query to the applicant concerning the charitable nature of the objects of the applicant and the genuineness of its activities, and it was only in the order under appeal that such objection was raised unilaterally for the first time, to the prejudice of the applicant. 18. Pertinently, as rightly contended, in 'Ananda Social & Educational Trust vs. CIT' [2020] 426 ITR 340 (SC), the ....
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....ed 20.8.2018. Since we have considered the issue relating to grant of registration to the applicant under consideration, under section 12A of the Act, while dealing with the Grounds raised in ITA No.642/LKW/2018 and have directed to forthwith grant registration to the assessee under section 12A of the Act, the appeal of the assessee in ITA No.158/LKW/2019 has become infructous and hence the same is dismissed as infructous. 22. In the result, the appeal of the assessee in ITA No.642/LKW/2018 is allowed and the appeal of the assessee in ITA No.158/LKW/2019 is dismissed as infructuous. Order pronounced in the open Court on 02/11/2021. ============= Document 1 24 GOVERNMENT OF INDIA MINISTRY OF FINANCE OFFICE OF THE COMMISSIONER OF INCOME TAX (EXEMPTIONS), 5TH FLOOR, SOUTH BLOCK, T.C./46V, U.P.S.C.I.D.C. LTD, VIBHUTI KHAND, GOMTINAGAR, LUCKNOW-226010 TELE/FAX: 0522-2724907/14 F.No. CIT(E)/LKO/12A/1457/2018-191957 Dated: 22-May-18 To, The President/Secretary/Trustee, Ashok Kiran Charitable Trust, 35-C-8, Sir, Rampur Garden, Bareilly, UP Sub: Your application for registration u/s 12A of the Income Tax Act, 1961 (PAN No. AAFTA2618B) Hea....
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....2(15) of the Income Tax Act, 1961. Please furnish your telephone number and e-mail address. Please specify the category of charitable purposes provided in section 2(15) of the Income-Tax Act, 1961 in which your case falls, i.e., whether your objective is relief of the poor/ education/ yoga/ medical relief preservation of environment (including watersheds, forests and wildlife) preservation of monuments or places of artistic/historic interest/ advancement of any other object of general public utility/religious activities. Please furnish details of charitable activities carried out during the last three years along with supporting evidences. 25 15. 16. 17. 18 19. Your Trust Deed/ Memorandum of Association does not have Irrevocability Clause. Please include this clause in your Trust Deed/ Memorandum of Association and file a certified copy of the amended Trust Deed/ Memorandum of Association. Your Trust Deed/ Memorandum of Association does not have a clause that the beneficiaries are a section of the public and not specific individuals. Please include this clause in your Trust Deed/ Memorandum of Association and file a cer....
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