Commissioner Of Income Tax v. M/S Geetanjali Education Society

Commissioner of Income Tax v.M/s Geetanjali Education Society Date of order : 18.08.2008 HON'BLE THE CHIEF JUSTICE MR. NARAYAN ROYHON'BLE MR. JUSTICE SANGEET LODHA Mr. K.K.Bissa for the appellant Heard learned counsel for the appellant. This appeal is directed against order dated 8.11.2007 passed by the Income Tax Appellate Tribunal, Jodhpur Bench, affirming theorder passed by the Commissioner of Income Tax (Appeals), settingaside the assessment order made against the assessee society. The Assessing Authority assessed the society ignoring thedonations given by different persons in favour of the society, holdingthe donors as bogus. The Commissioner of Income Tax (Appeals)reversed the order of assessment holding that all the donors wereneither examined nor some of them examined, were not allowed to becross examined to come to a conclusion as to whether they werebogus donors. It clearly held that in case there were some bogusdonors and donation was found to be not genuine, registration of theassessee under section 12AA could have been cancelled/withdrawn. The Appellate Tribunal on appreciation of facts and pleadingsof the parties concurred with the views of the Commissioner ofIncome Tax (Appeals) and reiterated the same view and held that thedonors could not have been declared to be bogus , as on totality of it the donors were not examined nor those who were examinedwere allowed to be cross examined. It further held that since thesociety is a registered society under the provisions of section 12AA ofthe Income Tax Act, it enjoyed the exemption as provided underSection 11 of the Act. On close scrutiny of the findings recorded by theCommissioner of Income Tax and Appellate Tribunal, we are of theview that the donations given in favour of the society could not havebeen held to be bogus without examining the donors and subjectingthem to cross-examination. The veracity of genuineness must betested at the touch stone of evidence and not otherwise. We aresatisfied that registration of the society has not been withdrawn evenon account of finding the donors as in-genuine. If the registration isallowed, the society would be entitled to get the exemption asprovided under section 11 of the Act. In the given facts andcircumstances of the case, therefore, the finding recorded by theCommissioner of Income Tax (Appeals) and Appellate Tribunal, inour view, cannot be faulted. This appeal is accordingly dismissed. (SANGEET LODHA),J. (NARAYAN ROY), C.J. mathur/