KRISHNA SEN EDUCATIONAL TRUST,GURGAON vs. THE COMMISSIONER OF INCOME TAX (EXEMPTION), CHANDIGARH, CHANDIGARH

IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, CHANDIGARH VIRTUAL HEARING BEFORE HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM AND HON’BLE SHRI RAJESH DAMODARLAL SHARMA, JM 1. आयकरअपीलसं. / ITA No.1059/CHANDI/2026 & 2. आयकरअपीलसं. / ITA No.1071/CHANDI/2026 Krishna Sen Educational Trust CIT (Exemptions) बनाम/ House No. 31, National Media Centre Room No.1, 5th Floor NH – 8, Gurgaon, Haryana – 122002 CR Building, Himalaya Marg Vs. Sector – 17E, Chandigarh – 160017 �ायीलेखासं./जीआइआरसं./PAN/GIR No. AACTK-1057-F (अपीलाथ�/Appellant) : (��थ� / Respondent) अपीलाथ�कीओरसे/ Appellant by : Sh. Arvind Nair (CA) – Ld. AR ��थ�कीओरसे/Respondent by : Smt. Jaishree Sharma (CIT) - Ld. DR सुनवाईकीतारीख/Date of Hearing : 10-08-2026 घोषणाकीतारीख /Date of Pronouncement 12-08-2026 : आदेश / O R D E R Per Bench 1. Aforesaid appeals by assessee are connected appeals. First, we take up ITA No.1071/Chandi/2026 which arises out of an order passed by Ld. Commissioner of Income Tax (Exemption), Chandigarh, [CIT(E)] on 27-02-2026 granting registration to the assessee-trust u/s 12AB(1)(b) for AYs 2027-28 to 2036-37. The only grievance of the assessee is that it has been accorded the status of Religious Entity as

against the claim of the assessee that it was religious cum charitable trust. 2. During hearing, it is the contention of Ld. AR that the assessee is engaged in providing relief to the poor, education and working for public welfare. It has been stated that the status of the assessee has been accorded as religious entity because the assessee had certain objects which refer to activities such as worship, yoga and meditation without appreciating the fact that these activities were incidental and not the main purpose of the trust. The trust is only engaged in providing educational support and welfare activities for poor and under-privileged girls which is the predominant and real activity undertaken by the assessee-trust. The same is also evident from assessees’ financial statements. The Ld. AR also referred to extensive documentary evidences which are placed in the paper-book. The Ld. AR contended that the impugned orders do not identify any expenditure incurred on religious activity. Therefore, the conclusion of Ld. CIT(E) is against the facts and circumstances of the case. The Ld. AR also stated that no effective opportunity of hearing was granted by Ld. CIT(E) before holding the assessee-trust to be a religious entity and therefore, the stated facts could be considered again by Ld. CIT(E). The Ld. CIT-DR opposed any interference in the impugned order. 3. Upon careful consideration of assessee’s paper-book and financial statements, we find substantial force in the argument of Ld. AR and accordingly, inclined to accept the plea of Ld. AR. Apparently

the issue that the assessee was a religious entity was nowhere been confronted to the assessee which was in violation of the principles of natural justice. When the financial statements and other documents were duly been furnished by the assessee along with its nature of activities wherein the assessee claimed its status to be a charitable entity, Ld. CIT(E) could not have held the assessee to be religious entity without confronting specific issues to the assessee. Therefore, we set aside the impugned order for de novo consideration of Ld. CIT(E) in the light of assessee’s financial statements and other documents with a direction to the assessee to plead and prove its case forthwith. The appeal stand allowed for statistical purposes. 4. In ITA No.1059/Chandi/2026, the assessee is aggrieved by denial of approval u/s 80G(5)(ii). The approval has been denied on the ground that assessee’s object clause of Memorandum of Association include religious activities. However, no factual examination of financial statements has been done and the conclusion is not based on actual facts. No doubt, Explanation-3 provides that charitable purpose does not include a purpose which is wholly or substantially wholly of a religious nature. However, sub-section (5B), which has non-obstante clause, deems an institution to continue to satisfy the requirement of Section 80G(5) wherein religious-nature expenditure in a previous year does not exceed five per cent of trust’s total income for that year. No such exercise has been carried out in the impugned order and no such findings have been brought on record. Under these circumstances, we set aside the impugned order and restore this

appeal also back to Ld. CIT(E) on similar lines. The appeal stand allowed for statistical purposes. 5. Both the appeals stand allowed for statistical purposes. Order pronounced on 12th August, 2026

-Sd- -Sd- (RAJESH DAMODARLAL SHARMA) (MANOJ KUMAR AGGARWAL) JUDICIAL MEMBER ACCOUNTANT MEMBER AS Dated: 12.08.2026 आदेश की �ितिलिप अ�ेिषत /Copy of the Order forwarded to : 1. अपीलाथ�/Appellant 2. ��थ�/Respondent 3. आयकरआयु�/CIT 4. िवभागीय�ितिनिध/DR 5. गाड�फाईल/GF

BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL KENDRIYA SADAN, SECTOR – 9A CHANDIGARH