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TMI Blog2016 (3) TMI 45X X X X Extracts X X X X X X X X Extracts X X X X ..... red a commercial activity there will not be any trust working in commercial atmosphere. Since the Assessing Officer has not verified on the grounds of commercial expediency, we are of the opinion that the matter has to be examined. So considering the facts and circumstances we set aside the Revision order u/s.263 of CIT(E) for limited purpose to the file of the Assessing Officer to verify the process of tender and applications and whether actions of the trust are in the nature of profit motive and the assessee should be provided adequate opportunity of being heard and file documents to support their contentions and the Assessing Officer shall pass the order on merits. - Decided partly in favour of assessee for statistical purpose - I.T.A. No.1221/Mds/2015 - - - Dated:- 22-1-2016 - SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SHRI G. PAVAN KUMAR, JUDICIAL MEMBER For The Appellant : Shri. S. Sridhar, Advocate For The Respondent : Shri. V. Vivekanandan, CIT, DR ORDER PER G. PAVAN KUMAR, JUDICIAL MEMBER: The appeal filed by the assessee is directed against the Revision order u/s.263 of the Act of Commissioner of Income-tax (Exemptions), Chennai in CIT (E)No.2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s found that there is no specific direction for making corpus donation and denied exemption u/s.11(1)(d) of the Act passed assessment order u/s.143(3) of the Act dated 30.11.2012. 4. The ld.CIT(E) under revisionary powers issued notice for initiation of proceedings u/s.263 of the Act. The ld.CIT(E) relied on income and expenditure account were the assessee has shown contributions received towards Solid Waste Management Implementation ₹ 2,05,43,133/- and also found that expenses were debited to the income and expenditure account on account of awareness expenses, project management expenses. The ld.CIT(E) on perusal of the trust deed and the objects of the trust came to a unilateral conclusion objects are of general public utility and made distinction with the amended provisions u/s.2(15) of the Act effective from 01.04.2009 and relied on the decision of ITAT, Panaji Bench and concluded that the institution which incorporated for charitable purpose cannot have profit motive and compared that the assessee trust has received big contribution and the same was not assessed u/s.143(3) of the Act and considered the assessment is erroneous and prejudicial to the interest of the Rev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... table purpose as against receipts of waste management service. Assessee trust claimed expenditure referred above and concluded that the order of the Assessing Officer is not erroneous and not prejudicial to the interest of the Revenue. The CIT(E) though considered the objects but dissented as work agreement was entered by the trust with various Municipalities are in the nature of works contract and profit motive and made a categorical finding that the assessee has participated in Tender process like any similar commercial activity and shall not take shelter under the Charitable Trust. The ld. CIT(E) consider the waste solid management is not charity and treated the activities of the trust as commercial activities and not as preservation of environment. Further without considering the itoto of submissions that the trust is creating civic awareness of healthier environment by sanitation and waste management but presumed that the predominant activity of the trust is to undertake commercial activities and accordingly cancelled the assessment order and directed the Assessing Officer redo the assessment.. Aggrieved by the order of the CIT(E) u/s.263 of the Act assessee assailed an appeal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tees. Therefore, any action of the trust are within four corners of byelaws and has not violated any clause of trust and to support the case relied on the decision of Panaji Tribunal Bench in the case of Entertainment Society of Goa vs. CIT (2013) 34 taxmann.com 210 and pleaded for squashing the Revision order passed by CIT(E) and allow the appeal. 6. Contra to the submissions, the ld. Departmental Representative relied on the income and expenditure account referred at Page Nos. 48 49 of paper book and drew attention to the statement of depreciation that there is no asset purchased by the company and most of the assets being tricycles and the trust has violated the provisions of Sec.2(15) of the Act and the activities are not charitable in nature and relied on the CIT(E) order and pleaded for dismissal of appeal. 7. We heard the rival submissions of both the parties, perused the material on record and judicial decisions cited. The assessee trust is registered and obtained registration u/sec. 12A and approval under Sec. 80G of the Act. On perusal of the trust deed, the objects are more service oriented and the trust is in the third year of operation after registration. The a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in favour of the society. The trust being registered under the state laws and the Director of Income Tax (Exemption) granted Registration exemption under 12A and 80G and the accounts are Audited and accepted by the Income Tax Department for earlier years. The surplus generated is only incidental. It is apparent from the facts and evidence produced the assessee s main object is only waste solid management and other objects are incorporated for future prospects. Therefore, the contention of the CIT(E) on the ground of noncharitable purpose cannot be accepted. Further, procedure for applying tender is based on the contributor terms and such activities if considered a commercial activity there will not be any trust working in commerical atmosphere. Since the Assessing Officer has not verified on the grounds of commercial expediency, we are of the opinion that the matter has to be examined. So considering the facts and circumstances we set aside the Revision order u/s.263 of CIT(E) for limited purpose to the file of the Assessing Officer to verify the process of tender and applications and whether actions of the trust are in the nature of profit motive and the assessee should be provide ..... X X X X Extracts X X X X X X X X Extracts X X X X
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