TATA EDUCATION TRUST,MUMBAI vs. ASSISTANT COMMISSIONER OF INCOME TAX-17(3), MUMBAI

ITA 4835/MUM/2024Status: DisposedITAT Mumbai10 October 2025AY 2017-1827 pages
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What did the Tribunal hold?

The Tribunal decided that a charitable trust registered under Section 12A and eligible for exemption under Section 11 of the Income Tax Act, 1961, can also claim exemption under Section 10(34) and Section 10(35) of the Act on dividend income and income from units, respectively. The Tribunal relied on its own Coordinate Bench's decision in the assessee's own case for AY 2012-13, which held that the exemption under Sections 10(34) and 10(35) is admissible. The Tribunal found the CIT(A)'s reliance on the Madras High Court decision in CIT vs. Working Women's Forum to be misplaced, as that case did not deal with Sections 10(34) and 10(35). Consequently, the denial of exemption under Sections 10(34) and 10(35) by the AO and upheld by the CIT(A) was reversed. For AY 2017-18, the Tribunal noted that the grounds raised by the Department were misconceived as the CIT(A) had not granted relief regarding exemption under Section 11 or Sections 10(34) and 10(35). The Tribunal also referred to its decision in ITA No. 4156/Mum/2024 concerning grounds related to Section 12A registration, Sections 11 to 13, Section 10(35), Section 80G, and Section 80GGA, stating that the decision therein would apply mutatis mutandis. The assessee's appeals, except for one which was infructuous, were partly allowed, and the Revenue's appeals were dismissed.

What were the facts?

The Income Tax Appellate Tribunal (ITAT), Mumbai Bench, heard nine appeals filed by Tata Education Trust (assessee) and the Department concerning assessment years 2013-14 to 2017-18. The appeals arose from orders passed by the National Faceless Appellate Centre (NFAC), Delhi. The primary dispute revolved around the assessee's claim for exemption on dividend income and income from units, and the applicability of Section 11 of the Income Tax Act, 1961. The Assessing Officer (AO) denied exemptions under Sections 10(34) and 10(35), holding that the trust violated Sections 13(1)(d) and 13(2)(h) due to investments in Tata Sons Ltd. shares and that income should be taxed at the maximum marginal rate. The Commissioner of Income Tax (Appeals) [CIT(A)] upheld the AO's reasoning on violations but granted partial relief by taxing only dividend income at the maximum marginal rate, while other incomes were taxed at the normal rate.

What were the issues?

1. Whether the assessee, a charitable trust registered under Section 12A, is eligible to claim exemption under Section 10(34) and Section 10(35) of the Income Tax Act, 1961, on dividend income and income from units, respectively, when it is also claiming exemption under Section 11 of the Act. - Assessee's contention: Exemption under Sections 10(34) and 10(35) cannot be rejected solely because the assessee is a Section 12A registered trust claiming Section 11 exemption. The CIT(A) wrongly applied the decision in CIT vs. Working Women's Forum, as that case did not involve Sections 10(34) and 10(35) and was for different assessment years. The assessee's own case for AY 2012-13 was decided in its favour by a Coordinate Bench. - Revenue's contention: The Departmental Representative supported the reasoning of the departmental authorities but agreed that the issue was covered by the Coordinate Bench decision relied upon by the assessee. 2. Whether the assessee's registration under Section 12A of the Act was still in force for AY 2017-18, and consequently, whether Sections 11 to 13 of the Act were applicable. - Assessee's contention: The CIT(A) erred in concluding the registration was in force, disregarding the Tribunal's order that registration ceased from March 20, 2015. Sections 11 to 13 should not apply as registration was surrendered on February 19, 2015. If registration was active, the benefit of Section 11 should have been granted. The CIT(A) also erred in denying exemption on income from units under Section 10(35), deduction under Section 80G and 80GGA, and upholding interest under Section 234B. - Revenue's contention: The CIT(A) erred in concluding that the registration was in force, disregarding the Tribunal's order. Sections 11 to 13 should not be applicable as registration had ceased. The CIT(A) also erred in upholding the denial of exemption on income from units, denying deduction under Section 80G, and denying deduction under Section 80GGA.

Which sections of the Income-tax Act were involved?

Section 10(34),Section 10(35),Section 11,Section 12A,Section 13(1)(d),Section 13(2)(h),Section 154,Section 234B,Section 234C,Section 80G,Section 80GGA

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IN THE INCOME TAX APPELLATE TRIBUNAL “E” BENCH, MUMBAI BEFORE SHRI SAKTIJIT DEY, VICE PRESIDENT AND SHRI NARENDRA KUMAR BILLAIYA, ACCOUNTANT MEMBER ITA No. 4282, 4283, 4156, 4496, 4727, 4835, 4852, 4419, 4873/Mum/2024 (Assessment Years: 2014-15, 2013-14,)

Circle-2(1), Mumbai-400001 Mumbai (Appellant) : (Respondent) PAN NO. AAATT 9835A ITA No. 4156, 4496, 4727 & 4835/Mum/2024 (Assessment Years:2015-16, 2016-17 & 2017-18)

Tata Education Trust Vs.

Asst. Commissioner of Income Tax-17(3)

Kautilya Bhavan, Bandra Kurla Complex, Mumbai-400 051 Mumbai-400001 (Appellant) : (Respondent) PAN NO. AAATT 9835A ITA No.4852, 4419, 4873 /Mum/2024 (Assessment Years:2013-14, 2014-15 and 2017-18)

Asst. Commissioner of Income Tax- Vs. 26(1), Room No. 249, 2nd Floor Kautilya Bhavan, BKC, Mumbai-400 051 Mumbai-400001 Tata Education Trust, 2nd Floor, Bombay House, 24, Homi Mody Street, Fort, (Appellant) : (Respondent) PAN NO. AAATT 9835A Appellant by Shri P.J. Pardiwala a/w Shri Sukhsagar & Shri Atul Suraiya Respondent by Shri Ritesh Mishra, CIT DR (Appellant) (Respondent)

Date of Hearing 29.09.2025 Date of Pronouncement 10.10.2025 2

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