Commissioner Of Income Tax,Chennai v. Indomer Ananathichandramohancharitable Trustplot

IN THE HIGH COURT OF JUDICATURE AT MADRASDATED : 06.07.2021 CORAM THE HON'BLE MR.JUSTICE M. DURAISWAMYANDTHE HON'BLE MRS.JUSTICE R. HEMALATHATax Case Appeal No.506 of 2013 Commissioner of Income Tax,Chennai. ... Appellant Vs. Indomer AnanathiChandramohanCharitable TrustPlot 115, AlwarThirunagar AnnexeChennai – 600 087. ...Respondent Tax Case Appeal filed under Section 260A of the Income TaxAct, 1961 against the order of the Income Tax AppellateTribunal, Chennai "D" Bench, dated 21.01.2013 passed inI.T.A.No.1903/Mds/2012 preferred against the order of theDirector of Income Tax (Exemption) Chennai, dated 06.09.2012 inDIT(E)No.2(119)/11-12 against the order of Income Tax AppellateTribunal 'B' Bench, Chennai in I.T.A.No.55/mds/2012 order dated15.03.2012 For Appellant : Mr.J.Narayanaswamy Senior Standing Counsel For Respondent : Mr.T.Vasudevan for M/s.R.Janakiraman J U D G M E N T(Delivered by M.DURAISWAMY, J.) Challenging the order passed in I.T.A.No.1903/Mds/2012 onthe file of the Income Tax Appellate Tribunal, Chennai "D"Bench, the Revenue has filed the above appeal. https://hcservices.ecourts.gov.in/hcservices/ 2.The assessee trust was constituted by a Trust Deed dated16.03.2011 and had filed an application in Form-10A on19.05.2011 for registration under Section 12-AA. Whileprocessing the application, the Director of Income Tax(Exemptions) (“DITE” for brevity) issued a letter dated26.09.2011 calling for details and asking to show cause whyregistration under Section 12-AA on the ground that the objectclause 2(e) of the Trust Deed states about contribution of thefunds towards developing, renovating and maintaining the placesof worship, and clause 2(g) of the Trust Deed promotes Godconsciousness. The DITE rejected the application under Section12-AA on the ground that the objects of the Trust contains mixedobjects both religious and charitable as against the provisionsof Section 11(1)(a) which only allows exemptions to the Trustwhich is either charitable or religious and not both. 3.Aggrieved by the said order, the assessee filed an appealbefore the Income Tax Appellate Tribunal and the Tribunalallowed the appeal by following the decision of this Court inthe case of Arulmigu Kamakshi Amman Trust in T.C.A.No.643 of2011 dated 25.01.2012. The DITE, while giving effect to theorder of the Tribunal, granted registration to the Trust as“Public Religious Trust”. 4.Challenging the same, the assessee filed an appeal beforethe Income Tax Appellate Tribunal, and the Tribunal, by theimpugned order, directed the DITE to grant registration to theTrust as “Public Religious Trust”. 5.Aggrieved over the order passed by the Income TaxAppellate Tribunal, the Revenue has filed the above appeal. 6.The above appeal was admitted on the followingsubstantial question of law : “Whether on the facts and circumstances of the case,the Tribunal was right in holding that the assesseetrust is entitled for registration u/s.12AA as publiccharitable trust?” 7.While modifying the order passed by the DITE, theTribunal followed the judgment of the Division Bench of thisCourt, dated 25.01.2012, made in T.C.A.No.643 of 2011, wherein, https://hcservices.ecourts.gov.in/hcservices/ the Tribunal held as follows : “3.It was submitted by the Id.A.R. that the issuein this appeal was agains the action of the DIT inholding that the assessee was not eligible forregistration u/s.12AA of the Act on the ground thatone of the objects of the assessee speaks aboutdeveloping and maintenance of places of worship asalso promoting god consciousness. It was thesubmission that the issue was squarely covered by thedecision of the Hon'ble jurisdictional High Court ofMadras in the case of Arulmigu Kamakshi Amman Trust inTax Appeal No.643 of 2011 dated 25.01.2012 wherein theHon'ble jurisdictional High Court has held asfollows : https://hcservices.ecourts.gov.in/hcservices/ the Tribunal held as follows : “3.It was submitted by the Id.A.R. that the issuein this appeal was agains the action of the DIT inholding that the assessee was not eligible forregistration u/s.12AA of the Act on the ground thatone of the objects of the assessee speaks aboutdeveloping and maintenance of places of worship asalso promoting god consciousness. It was thesubmission that the issue was squarely covered by thedecision of the Hon'ble jurisdictional High Court ofMadras in the case of Arulmigu Kamakshi Amman Trust inTax Appeal No.643 of 2011 dated 25.01.2012 wherein theHon'ble jurisdictional High Court has held asfollows : “We have carefully considered the above submission.For the purpose of making an application under Section12AA, the applicant must apply in Form 10. The saidForm prescribes the format of the notice ofaccumulation of income to be given by charitable andreligious trusts under Section 11[2] of the Act. Forthe purpose of availing the benefit of Section 11,registration is required. Section 11[1][a] reads asunder:- "11[1]. Subject to the provisions ofsections 60 to 63, the following income shallnot be included in the total income of theprevious year of the person in receipt of theincome-- [a] income derived from property heldunder trust wholly for charitable or religiouspurposes, to the extent to which such income isapplied to such purposes in India; and, whereany such income is accumulated or set apart forapplication to such purposes in India, to theextent to which the income so accumulated orset apart is not in excess of fifteen per centof the income from such property;" 6.From a reading of the above, it is clear thatthe income derived from the property held under trustwholly for charitable or religious purposes, shall notbe included in the total income of the Trust.Therefore, the said provision would be applicable toboth the Trusts established with the object ofcharitable as well as religious purposes. Therefore,Section 12AA of the Act does not make any difference between the Trusts created with the object ofcharitable and religious purposes and, even if theTrust is not created with both the objects, law doesnot make any disqualification for the trust to make anapplication for registration. Therefore, the Tribunalhas correctly applied the provision of law and allowedthe appeal, which finding is based on valid materialevidence. The finding of the Tribunal is not perverseand it is a question of fact. Therefore, we find noground to cause our interference into the order passedby the Tribunal. Accordingly, the order passed by theTribunal is confirmed and both the substantialquestions of law raised herein are answered againstthe Revenue.” It was the further submission that in view of thedecision of the Hon'ble jurisdictional High Court theassessee was entitled to be registered u/s.12AA of theAct. 4.In reply, the Id.D.R. Vehemently supported theorder of the DIT. It was the submission that theassessee trust had religious clauses in its objectsand consequently was not entitled to registrationu/s.12AA of the Act. 5.We have heard the rival submissions. As it isnoticed that the issue in this appeal is squarelycovered by the decision of the Hon'ble jurisdictionalHigh Court in the case of Arulmigu Kamakshi AmmanTrust (supra), the DIT is directed to grantregistration u/s.12AA of the Act.” 8.Mr.J.Narayanaswamy, learned Senior Standing Counsel,appearing for the appellant/Revenue, fairly submitted that theratio laid down by the Division Bench of this Court inT.C.A.No.643 of 2011 squarely applies to the facts andcircumstances of the present case. 5.We have heard the rival submissions. As it isnoticed that the issue in this appeal is squarelycovered by the decision of the Hon'ble jurisdictionalHigh Court in the case of Arulmigu Kamakshi AmmanTrust (supra), the DIT is directed to grantregistration u/s.12AA of the Act.” 8.Mr.J.Narayanaswamy, learned Senior Standing Counsel,appearing for the appellant/Revenue, fairly submitted that theratio laid down by the Division Bench of this Court inT.C.A.No.643 of 2011 squarely applies to the facts andcircumstances of the present case. 9.The Tribunal has rightly observed that there is no trustcalled “Public Religious Trust” and there can only be a “PublicCharitable Trust”, therefore, the order passed by the DITE on06.09.2012 granting registration to the Trust as “PublicReligious Trust” is erroneous and the same should be modified as“Public Charitable Trust”. The reasoning given by the Income https://hcservices.ecourts.gov.in/hcservices/ Tax Appellate Tribunal is just and proper. We do not find anyground much less any substantial question of law to interferewith the order passed by the Income Tax Appellate Tribunal. 10.Accordingly, this Tax Case Appeal is dismissed. Nocosts. Sd/- Assistant Registrar(CS) //True Copy// Sub Assistant Registrar mkn To 1. The Income Tax Appellate Tribunal, Chennai "D" Bench 2. The Commissioner of Income Tax, Chennai. 3. The Director of Income Tax(Exemption), Chennai. Tax Case Appeal No.506 of 2013 GM(CO)SU(27/07/2021)