SPREADING SMILES,GURGAON vs. ITO-WARD EXEMPTION-FARIDABAD, FARIDABAD

ITA 2314/DEL/2026Status: DisposedITAT Delhi13 May 2026AY 2022-238 pages
AI SummaryAllowed

What were the facts?

The assessee, a charitable trust, claimed exemption under Section 11. Its application for registration was initially rejected, but later restored by the ITAT. The Assessing Officer denied exemption and disallowed certain expenses, treating the assessee as an AOP. The CIT(A) upheld the AO's order, stating the registration was granted after the assessment year.

What did the Tribunal hold?

The Tribunal held that the doctrine of relating back applies, and the assessee is eligible for exemption under Section 11 and 12 as the final registration was granted for the original application. Capital expenditure incurred for infrastructure was also considered an application of income and allowable.

What were the issues?

Whether the assessee is eligible for exemption under Section 11 and 12 when registration is granted retrospectively. Whether capital expenditure on infrastructure is allowable as an application of income for charitable trusts.

Which sections of the Income-tax Act were involved?

Section 11,Section 12,Section 12A,Section 12AB,Section 143(3),Section 144B,Section 156,Section 164(1)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH ‘SMC’: NEW DELHI

Before: SHRI RAMIT KOCHAR

For Appellant: Shri M.R. Sahu, CA
For Respondent: Shri Manoj Kumar, Sr. DR
Hearing: 06.05.2026Pronounced: 13.05.2026

PER RAMIT KOCHAR, AM: This appeal in ITA No. 2314/Del/2026 for Assessment Year: 2022-23 has arisen form the learned CIT(A)’s appellate order dated 23.02.2026 passed u/s 250 of the Income-tax Act, 1961(In Short “the Act”) in DIN & Order No: ITBA/NFAC/S/250/ 2025-26/1086404620(1), which appeal in turn has arisen from the assessment order dated 13.02.2024 passed by the AO u/s 143(3) r.w.s 144B of the 1961 Act .

2.

Brief facts of the case are that the assessee filed its return of income u/s 139 for the impugned assessment year on 25.09.2022 , declaring income of Rs. NIL after claiming exemption. The case of the assessee was selected for framing complete scrutiny assessment , and the AO issued

The order continues below.

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