PONNUSAMY NADAR EDUCATION TRUST,CHENNAI vs. ACIT, CHENNAI

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ITA 2255/CHNY/2026Status: DisposedITAT Chennai21 August 2026AY 2023-245 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the subsequent development of obtaining valid registration covering the relevant assessment years nullified the basis for denying the Section 11 exemption. Therefore, the denial of exemption was incorrect.

What were the facts?

The assessee, a charitable trust, had its Section 11 exemption denied as its Section 12A registration was cancelled due to an inadvertent fresh application. Subsequently, the Tribunal set aside the cancellation order and the CIT(E) granted fresh registration.

What were the issues?

Whether the denial of exemption under Section 11 was justified when the assessee subsequently obtained valid registration under Section 12A.

Which sections of the Income-tax Act were involved?

Section 11,Section 12A,Section 143(1)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘C’ BENCH, CHENNAI

Before: SHRI GEORGE GEORGE K & SHRI GAGAN GOYAL

Hearing: 20.08.2026Pronounced: 21.08.2026

आदेश/ O R D E R PER GEORGE GEORGE K, VICE PRESIDENT: These appeals filed by the assessee are directed against two orders of Addl./JCIT(A)-12, Mumbai both dated 13.03.2026 passed under section 250 of the Income Tax Act, 1961 (hereinafter called ‘the Act’). The relevant Assessment Years are 2023-24 & 2024-25.

ITA Nos.2255 & 2256/CHNY/2026 - 2 - Ponnusamy Nadar Education Trust 2. Brief facts of the case are as follows: The assessee is a charitable trust registered u/s.12A of the Act, since 1989. For the assessment years 2023-24 & 2024-25, the assessee filed its returns of income claiming exemption u/s.11 of the Act. The returns were processed by CPC, Bengaluru and intimation u/s.143(1) of the Act was issued on 17.12.2025 and 23.12.2025, respectively, wherein the exemption claimed u/s.11 was denied.

3.

Aggrieved, the assessee preferred appeals before the First Appellate Authority (FAA). Before FAA, it was submitted that the assessee is an old charitable trust holding registration u/s.12A of the Act, since 1989 and had obtained registration u/s.12A(1)(ac)(i) for AYs 2022-23 to 2026-27 vide order dated 07.04.2022. Subsequently, based on the consultant’s erroneous advice that the registration was provisional, the assessee filed an application u/s.12A(1)(ac)(iii) on 15.09.2023, which was rejected by the CIT(E) on 06.03.2024 for non-compliance, resulting in cancellation of the existing registration. The assessee further submitted that appeals against the orders of the CIT(E) were pending before the Tribunal. The FAA, however, dismissed the appeals holding that the assessee did not have valid registration u/s.12A of the Act and, therefore, the CPC was justified in denying the exemption claimed u/s.11 of the Act.

ITA Nos.2255 & 2256/CHNY/2026 - 3 - Ponnusamy Nadar Education Trust 4. Aggrieved, the assessee is in appeals before the Tribunal. The Ld.AR submitted that the assessee is an old charitable trust holding registration u/s.12A of the Act, since 1989. Pursuant to migration to the new registration regime, the assessee applied in Form No.10A and was granted registration u/s.12A(1)(ac)(i) of the Act for A.Ys. 2022-23 to 2026-27 vide order dated 07.04.2022. Subsequently, based on an erroneous advice that the registration was provisional, the assessee inadvertently filed a fresh application in Form No.10AB on 15.09.2023. As the notices issued in the said proceedings were not responded to, the CIT(E) vide order dated 06.03.2024, rejected the application and cancelled the existing registration. Consequently, exemption u/s.11 of the Act was denied while processing the returns u/s.143(1) of the Act for A.Ys. 2023-24 and 2024-25. The Ld. AR further submitted that the assessee challenged the order of CIT(E) dated 06.03.2024 before the Tribunal in ITA No.267/CHNY/2026, wherein the Tribunal vide order dated 13.07.2026 had set aside the order of the CIT(E) and restored the matter for fresh consideration. Pursuant thereto, the CIT(E), vide order dated 06.08.2026, granted registration u/s.12AB(1)(b) of the Act for A.Ys. 2022-23 to 2026-27, recording that the assessee already had valid registration for the said period and that the fresh application had been filed inadvertently. Therefore, the Ld. AR submitted that the assessee now has valid

ITA Nos.2255 & 2256/CHNY/2026 - 4 - Ponnusamy Nadar Education Trust registration covering the relevant assessment years and, consequently, the basis for denial of exemption u/s.11 in the impugned intimations no longer survives. He, therefore prayed that the impugned orders be set aside and the exemption claimed u/s.11 be allowed.

5.

The Ld.DR was duly heard.

6.

We have heard rival submissions and perused the material on record. It is an admitted position that the assessee was granted registration u/s.12A(1)(ac)(i) of the Act for A.Ys. 2022-23 to 2026-27 vide order dated 07.04.2022. The subsequent cancellation of the registration arose on account of an inadvertent fresh application filed in Form No.10AB, which was rejected by the CIT(E) for non- compliance. We further note that the assessee challenged the order of CIT(E) dated 06.03.2024 before this Tribunal in ITA No.267/CHNY/2026, wherein the matter was restored to the CIT(E) for fresh consideration vide order dated 13.07.2026. Pursuant thereto, the CIT(E), vide order dated 06.08.2026, has granted registration u/s.12AB(1)(b) of the Act for A.Ys. 2022-23 to 2026-27, observing that the assessee already had valid registration for the said period and that the fresh application had been filed inadvertently.

ITA Nos.2255 & 2256/CHNY/2026 - 5 - Ponnusamy Nadar Education Trust Thus, the assessee trust possesses the registration covering the relevant assessment years. In view of the subsequent development, the very basis on which exemption u/s.11 of the Act was denied while processing the returns u/s.143(1) of the Act no longer survives. Accordingly, we set aside the impugned intimations and direct the AO/CPC to allow the exemption claimed u/s.11 of the Act, subject to verification of the other statutory conditions, if any.

7.

In the result, the appeals filed by the assessee are allowed for statistical purposes.

Order pronounced in the open court on 21st August,2026 at Chennai.

Sd/- Sd/- (जॉज� जॉज� के) (गगन गोयल) (GEORGE GEORGE K) (GAGAN GOYAL) लेखा सद�य/ACCOUNTANT MEMBER उपा�य� /VICE PRESIDENT चे�नई/Chennai, �दनांक/Dated, the 21st August, 2026 RSR, Sr.PS आदेश क� ��त�ल�प अ�े�षत/Copy to: 1. अपीलाथ�/Appellant 2. ��यथ�/Respondent 3. आयकर आयु�त /CIT, Chennai 4. �वभागीय ��त�न�ध/DR 5. गाड� फाईल/GF. By Order REKHA Digitally signed by REKHA SENTHIL RAJ SENTHIL Date: 2026.08.21 RAJ 17:10:45 +05'30'

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