SMAI SATHAL DADI GAURI MANDIR SEVA SAMITI,BADYAN, RANGRAN vs. CIT EXEMPTION- CHANDIGARH, CHANDIGARH

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “G”, NEW DELHI SHRI RAMIT KOCHAR, ACCOUNTANT MEMBER AND BEFORE SHRI VIMAL KUMAR, JUDICIAL MEMBER ITA No. 4598/Del/2026, A.Y. 2025-26 Smai Sathal Dadi Gauri Vs. CIT(Exemption), Mandir Seva Samiti Chandigarh Dadi Gauri Mandir, Badyan Rangran, Hisar, Haryana �थायीलेखासं./जीआइआरसं./PAN/GIR No: ACBAS9788H Appellant .. Respondent Appellant by : Sh. Vir Sain Aggarwal, Advocate Sh. Rohit Kapoor, Advocate Respondent by : Shri Sher Singh, CIT(DR) Date of Hearing 30.06.2026 Date of Pronouncement 22.07.2026

O R D E R PER VIMAL KUMAR, JM: The appeal filed by the assessee is against the order dated 29.11.2024 of the Commissioner of Income Tax (Exemptions), Chandigarh [hereinafter referred to as “the CIT(E)”] under section 12A(1)(ac)(iii) of the Income Tax Act, 1961 (hereinafter referred to as “the Act”) rejecting the application since, provisional registration granted was bad.

P a g e | 2 ITA No. 4598/Del/2026 Smai Sathal Dadi Gauri Mandir Seva Samiti 2. Ld. Authorized Representative for appellant/assessee submitted that the appeal was filed on 31.01.2025 electronically and physically on 27.04.2026 due to illness of relative. There is no delay.

“1. That the appellant is a society duly registered as "Smai Sathal Dadi Gauri Mandir Seva Samiti” under the Haryana Registration and Regulation of Societies Act, 2012 (Registration No. 01735), having its registered office at Dadi Gauri Mandir, Badyan Rangran, Hisar, Haryana 125001 (Copy of certificate of registration is enclosed at page no. 1 of PB). 2. That the appellant-society was established for the management and administration of Dadi Gauri Mandir and other dharmic sathals in the village, including the development and maintenance of the Mandir Bhawan, organisation of the annual Dadi Gauri Mela on Krishna Janmashtami, receipt and application of donations, gifts, grants and sponsorships, and the carrying out of allied religious and charitable activities, in accordance with its Memorandum of Association (Copy of MOA is enclosed at page no. 2-20 of PB). 3. That the appellant had applied for provisional registration under section 12A(1)(ac) (iv) vide Form 10A dated 16.01.2024 and the same has been granted under section 12AB vide Form 10AC on 23.01.2024 (Refer page no. 21-22 of PB). Thereafter, form 10AB was filed on 26.06.2024 seeking regular registration under section 12A(1)(ac) (iii) of the Income-tax Act, 1961 (Refer page no. 23-31 of PB). 4. That the CIT(E) issued noticed the date 2024 and 07.11.2024. In response, the appellant filed reply on 13.11 2024 along with the requisite details. In the said reply, the date of commencement was stated as 14.09.2023, being the date of opening of donation box / first deposit of temple donations into the bank account. 5. That vide order dated 29.11.2024 in Form No. 10AD, the CIT(E) rejected the application mainly on the ground that the appellant had already commenced activities before grant of provisional registration and, therefore, provisional registration granted by CPC was bad in law(Refer page no. 49 of PB). The rejection was not based on any conclusive finding that the objects were non-religious, activities were non-genuine, or funds were applied for any non-permissible purpose.

P a g e | 3 ITA No. 4598/Del/2026 Smai Sathal Dadi Gauri Mandir Seva Samiti Rejection of Form 10AB merely on alleged defect in provisional registration is bad in law (Submission to Ground No.6) 6. That the jurisdiction of CIT(E) while considering an application under section 12AB is confined to examining the objects of the institution, genuineness of its activities and compliance with such other laws as are material for achieving its objects. In the present case, no adverse finding has been recorded on any of the above statutory parameters. The application has been rejected only because, according to the Ld. CIT(E), provisional registration ought not to have been granted earlier since the activities had already commenced. Such an approach is legally unsustainable. Once provisional registration had been granted and the appellant thereafter filed Form 10AB for regular registration, the Ld. CIT(E) was required to decide the application on merits under section 12AB. The earlier provisional registration could not be indirectly reviewed or nullified while deciding the application for regular registration. Therefore, rejection of Form 10AB solely on the ground that provisional registration was allegedly granted wrongly is contrary to the statutory scheme and liable to be quashed. No finding that objects are non-religious or activities are non-genuine (Submission to Ground No.6) 7. That although the impugned order initially states that the documents were not sufficient to verify genuineness, the ultimate basis of rejection is only the alleged wrong grant of provisional registration. After the appellant filed reply on 13.11.2024, the Ld. CIT(E) has not pointed out any specific defect in the objects, activities, bank statement, donations, books, or temple management records. The appellant is engaged in management of a public religious temple, receipt of temple donations through donation box and application thereof towards religious and temple-related activities. No material has been brought on record to show that the appellant is carrying on any bogus, commercial, non-genuine or non-religious activity. Thus, in absence of any adverse finding on genuineness of activities or charitable/religious objects, the rejection of registration is wholly unjustified. Wrong selection of clause, if any, is only a technical and curable defect (Submission to Ground No.4,5) 8. That even assuming, without admitting, that the appellant ought to have applied under section 12A(1)(ac)(vi)(B) instead of the clause under which provisional registration was granted under section 12A(1)(ac) (vi) (A), the same is at best a technical or clerical defect. A bona fide technical mistake in selecting a sub-clause cannot be treated as fatal where the appellant is otherwise eligible for registration and no mala fide intention has been alleged. The substance of the matter is that the appellant is a genuine religious society managing a temple.

P a g e | 4 ITA No. 4598/Del/2026 Smai Sathal Dadi Gauri Mandir Seva Samiti 9. The CIT(E) has also not recorded any finding that the appellant had claimed exemption under section 11, section 12 or section 10(23C) in any earlier year in violation of section 12A(1)(ac) (vi) (B). Therefore, even the statutory mischief contemplated under the provision has not been shown to exist. In such circumstances, the Ld. CIT(E) ought to have treated the application under the correct provision, permitted rectification of the technical defect, or called upon the appellant to file the application under the correct clause. Straightaway rejection defeats substantive justice. Supersession of earlier registration without invoking section 12AB(4) is without jurisdiction (Submission to Ground No.2,3) 10. That the Ld. CIT(E) has further erred in observing that the rejection shall supersede any registration granted under section 12AB by any authority at any earlier time. That cancellation or withdrawal of registration can be done only in accordance with section 12AB(4), upon existence of a specified violation and after following the mandatory procedure prescribed therein. In the preseri case, no specified violation has been alleged, much less established. There is no finding that activities are not genuine, that activities are not being carried out in accordance with objects, that income has been applied for private benefit, or that any law material to the objects has been violated. Therefore, the observation that earlier registration shall stand superseded is beyond jurisdiction and deserves to be set aside. Denial of Specific and Meaningful Opportunity Before Rejection of Registration (Submission to Ground No.7) 11. That the impugned order is also vitiated for want of a specific and meaningful opportunity. The notices issued were general questionnaire notices calling for documents and details. The appellant was not specifically confronted that the application would be rejected on the ground that provisional registration granted by CPC was bad in law or that the application under section 12A(1)(ac) (ii) was not maintainable. Thus, the appellant was denied an effective opportunity to explain that the alleged defect was purely technical, curable and not fatal to grant of regular registration. On this ground also, the impugned order is liable to be quashed.” 4. Reliance was placed on the judgment of Vir Sewa Mandir Versus CIT(Exemption), New Delhi, reported in 2024(9) TMI 1510-ITAT Delhi (ITA No. 1556/Del/2024 dated August 9, 2024).

P a g e | 5 ITA No. 4598/Del/2026 Smai Sathal Dadi Gauri Mandir Seva Samiti 6. From examination of the record in light of aforesaid rival submission, it is crystal clear that the Ld. CIT(E), vide impugned order dated 29.11.2024, rejected the application for registration u/s 12A(1)(ac)(iii) of the Act, since the provisional registration was bad in law. Ld. CIT(E) rejected the application on the ground that the assessee has already commenced activities before grant of provisional registration. Ld. CIT(E) had not issued any show cause notice prior to rejection of application. The appellant /assessee has claimed that non- issuance of show cause notice and non-granting of opportunity to explain the activities is unjust to the chargeable activities of the applicant.

Order pronounced in the open court on 22.07.2026

Sd/- Sd/- (RAMIT KOCHAR) (VIMAL KUMAR) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 22.07.2026

P a g e | 6 ITA No. 4598/Del/2026 Smai Sathal Dadi Gauri Mandir Seva Samiti Binita, Sr. PS Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI