Tilok Tirath Vidyavati Chhuttani Trust Vs CIT (Punjab and Haryana High Court)
Punjab and Haryana High Court held that rejection of claim of exemption under section 80G not based upon any substantial evidence is not tenable in law. Accordingly, writ petition is allowed.
Facts- While considering the application for renewal of exemption u/s. 80G of the 1961 Act and the income tax returns for the Assessment Year 1996-97, the Commissioner of Income-tax issued a show cause notice dated 17.02.1999, to the petitioner-Trust, inter alia, mentioning therein that it was noticed that the petitioner-Trust was not working for the objects for which it was created. In the said show cause notice, it was further pointed that the petitioner-Trust had donated Rs. 29,00,000/- to a society, namely, Sardarni Uttam Kaur Charitable Society, and its objects were not in any way connected with the objects of the petitioner-Trust.
The Commissioner of Income-tax, Chandigarh, passed a detailed order dated 24.09.1999 thereby rejected the application of the petitioner-Trust for continuation of approval of exemption u/s. 80G of the 1961.
Conclusion- The petitioner – Trust runs only one “Chhuttani Medical Centre”. Therefore, the donations made to it cannot be doubted merely for the reason that the donations in other years are of smaller amount. Respondents have not taken note of the fact that the petitioner – Trust had been making donations to Sardarni Uttam Kaur Charitable Society, which is also registered under Section 12-A of the IT Act and had been granted exemption under Section 80-G of the IT Act. Neither from the record, nor anything pointed out by the respondents that their action is in pursuance to the complaint from any person/organization/society, to which the medical services are being provided by the petitioner – Trust.
