THE AMIR EDUCATION SOCIETY,FARIDABAD vs. DEPUTY COMMISSIONER OF INCOME TAX, CHANDIGARH

Brief facts of the case are that assessee is an education society, filed an application for registration under section 12A(1)(ac)(ii) of the Act on 26.08.2025 seeking registration under section 12AB of the Act. The ld. CIT(E) rejected the registration by observing that the applicant is working for the benefit of related parties u/s section 13(1)(c) read with 13(2) of the Act by giving them higher return on unsecured loans and rent for the premises. 4. Aggrieved by the order of the ld. CIT(E), the assessee filed this appeal before us. 5. Before us, learned Counsel for the assessee stated that the ld. CIT(E) has passed an order without providing adequate opportunity of being heard to the assessee and thereby violating the principles of natural justice and prayed for setting aside the order to the file of ld. CIT(E) for fresh adjudication.

Per contra, learned DR did not raise any serious objection and relied upon the order of authorities below. 7. We have heard the rival submissions and perused the material available on record. The assessee has claimed to be an educational society imparting education. There are plethora of judicial precedents such as the Hon'ble Allahabad High Court in the case of CIT v. Red Rose School [2007] 163 Taxman 19 (Allahabad); the Hon'ble ITAT, Delhi Bench in the case of Shishu Kalyan Educational Society Vs. CIT(Exemption), Chandigarh in ITA No. 2704/Del/2026 order dated 08.07.2026 and Pista Devi Education Society v. Commissioner of Income-tax (Exemptions) [2026] 185 taxmann.com 691 (Delhi - Trib.); the Hon'ble High Court of Karnataka in the case of Director of Income- tax v. Garden City Educational Trust [2010] 191 Taxman 238 (Karnataka); the Hon'ble Gujarat High Court in the case of Commissioner of Income-tax Exemption v. Jamiatul Banaat Tankaria [2024] 168 taxmann.com 35 (Gujarat) which mandates that at the time of granting approval for registration u/s 12AB, the CIT(E) is required to be satisfied only with regard to objects of the Trust and genuineness of activities of the Trust and whether it complies with such requirements of any other law and the Id. CIT(E) is not to act as an Assessing Officer. We find that the ld. CIT(E) has instead of concentrating on express provisions as enumerated in section 12AB(1), has examined the application of funds of the Trust for rejecting the registration. In any case, the assessee has pleaded that it was not accorded adequate opportunity of being heard. We are of the considered view therefore, that the issues of charitable activities being aligned to its objects and its genuineness, be set aside to the file of the ld. CIT(E) for fresh adjudication. The ld. CIT(E) is directed to give three effective and reasonable opportunities to the assessee to represent the case. The assessee is likewise directed to avail the opportunities and submit documents/evidence as required by the ld. CIT(E). The appeal of the assessee is decided in aforesaid terms. 8. In the result, appeal of the assessee in ITA No.3539/Del/2026 is allowed for statistical purposes. Order pronounced in the open court on 12.08.2026.