THE KUSUM BHATIA FOUNDATION,CHANDIGARH vs. THE HONBLE COMMISSIONER OF INCOME TAX (EXEMPTIONS), CHANDIGARH

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ITA 1145/CHANDI/2026Status: DisposedITAT Chandigarh03 August 2026AY 2026-272 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal found that the assessee's financial statements showed expenses on medical and welfare activities, with no expenditure on religious activities. Since no proper opportunity for hearing was given before the categorization, the order was set aside.

What were the facts?

The assessee-trust applied for registration under Section 12AB(1)(b) and was granted registration as a Religious Entity by the CIT(E). The assessee contended that it should be classified as a charitable trust, not a religious entity.

What were the issues?

Whether the assessee-trust was correctly classified as a Religious Entity instead of a charitable trust, and if proper opportunity of hearing was provided.

Which sections of the Income-tax Act were involved?

Section 12AB(1)(b)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “B” BENCH, CHANDIGARH

Before: HON’BLE SHRI LALIET KUMAR, JM & HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM

आदेश / O R D E R Manoj Kumar Aggarwal (Accountant Member) 1. Aforesaid appeal by the assessee arises out of an order passed by Ld. Commissioner of Income Tax (Exemption), Chandigarh, [CIT(E)] on 12-02-2026 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 charitable trust. Having heard rival submissions, the appeal is disposed-off as under.

2.

From assessee’s financial statements for 31-03-2025 as placed on record, it would appear that the assessee is incurring medical expenses and children & welfare expenses. No expenditure on religious activity is noted in the same. Apparently, the categorization of the assessee as religious trust is not borne out of the facts on record. Since no effective opportunity of hearing has been granted by Ld. CIT(E) to the assessee before such categorization, we set aside the impugned order and restore the issue of registration back to the file of Ld. CIT(E) for de novo consideration with a direction to the assessee to plead and prove its case forthwith. 3. The appeal stand allowed for statistical purposes. Order pronounced on 03rd August, 2026

-Sd- -Sd- (LALIET KUMAR) (MANOJ KUMAR AGGARWAL) JUDICIAL MEMBER ACCOUNTANT MEMBER AS Dated: 03-08-2026 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

ASSISTANT REGISTRAR

ITAT CHANDIGARH

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