PCJAIN CHARITABLE FOUNDATION,JAIPUR vs. CIT EXEMPTION, CIT EXEMPTION

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ITA 1570/JPR/2025Status: DisposedITAT Jaipur25 August 2026AY 2025-264 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal found that the CIT(E) was incorrect in holding that the trust's activities were solely for a particular community, given its broad objects and the scholarships awarded to students of different backgrounds. The Tribunal set aside the CIT(E)'s order and directed a fresh assessment after providing the assessee with another opportunity for a hearing.

What were the facts?

The assessee's application for registration under Section 12AB was rejected by the CIT(E) on the grounds that it was not registered under the Rajasthan Public Trust Act and its objects were for the benefit of a particular community. The assessee later obtained RPT Act registration and argued that scholarships were awarded to students of various communities.

What were the issues?

Whether the rejection of registration under Section 12AB was justified based on the trust's objects and the beneficiaries of its activities, and whether registration under the Rajasthan Public Trust Act is a mandatory prerequisite for Section 12AB registration.

Which sections of the Income-tax Act were involved?

Section 12AB

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘B’ BENCH, JAIPUR

Before: Shri T.R. Senthil Kumar & Shri Prakash

For Appellant: Shri Sanjeev Mathur, CA
For Respondent: Shri Shravan Kumar

आदेश/ORDER

PER : T.R. SENTHIL KUMAR, JUDICIAL MEMBER:- This appeal is filed by the assessee as against the order dated 23.09.2026 passed by the Commissioner of Income Tax (Exemption), Jaipur, denying the registration u/s. 12AB of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) on the ground that the assessee has not got registration under Rajasthan Public Trust Act (RPT Act) and the object of the Trust are for the benefit of particular community.

I.T.A No. 1570/JPR/2026 Page No 2 PC Jain Charitable Foundation

2.

The Registry has noted that there is a delay of 342 days in filing the appeal and the assessee by way of notorized affidavit submitted that the Trustees did not check the e-mail account, therefore not noticed the rejection order passed by Ld. CIT(E). It is thereafter they found the rejection order and filed the appeal with a delay of 342 days which is not intentional and requested to condone the delay. Considering the above explanation, the delay of 342 days is hereby condoned.

3.

The Grounds of Appeal raised by the assessee are as follows:-

“1. On the facts and in circumstances of the case as well as law on the subject, the order passed by the learned Commissioner of Income-tax (Exemption) is illegal and against the law. 2. On the facts and in circumstances of the case as well as law on the subject, the learned Commissioner of Income-tax (Exemption) has erred in rejecting application for registration u/s 12AB of the Act without considering the fact that objects of the trust are not related to benefit of particular community. 3. On the facts and in circumstances of the case as well as law on the subject, the learned Commissioner of Income-tax (Exemption) has erred in rejecting application for registration u/s 12AB of the Act on the ground that trust is not registered with Devasthaan Vibhag, Jaipur where as the requirement of registering with Devasthan Vibhag is not mandatory as per Income-tax Act 1961. 4. The petitioner craves the right to add, alter or in any way amend the grounds of appeal.”

4.

Ld. Counsel for the assessee submitted that the assessee’s trust got registered under RPT Act vide Certificate of Registration dated 19.05.2025 and produced the copy of the same before us. Further, Ld. CIT(E) has made an observation that scholarships were given to the 35 students during the financial year out of which 25 students were of

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Jain Community and balance 10 students of other communities students, therefore the activities carried out substantially for the benefit of Jain Community thereby not granted registration u/s. 12AB of the Act. Ld. Counsel further brought to our notice the objects of the trust are not meant for particular community, it is meant for Public at large and more particularly clause (iii) of the object reads as follows:-

‘Grant of financial assistance including scholarships to poor and needy students and students of merit for furtherance of studies and for their sustenance.’

4.1. Thus, the scholarship given to the eligible students of various communities including two Muslim students and eight Hindu students. Therefore, the activities are not meant for particular community, but Public at large. It is therefore requested to set aside the matter back to the file of Ld. CIT(E) for grant of registration u/s. 12AB of the Act.

5.

Per contra, Ld. DR appearing for the Revenue supported the order passed by the lower authorities.

6.

We have considered the above submission of the assessee and perused the materials placed on record. The assessee trust after the rejection order passed by Ld. CIT(E), got Registration Certificate under RPT Act on 19.05.2025. It is further seen from the impugned order and the table of scholarships given to 35 students out of 10 students are other than the Jain Community. Thus, the Ld CIT(E) is not correct in holding that the activities of the Trust and the scholarships given to

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particular community only, whereas the objects of the Trust are not meant for a particular community. For this reason, the impugned order passed by the Ld. CIT(E) is hereby set aside with a direction to give one more opportunity of hearing to the assessee and thereafter pass a fresh order in accordance with provisions of law.

8.

In the result, the appeal filed by the assessee is hereby allowed for statistical purposes.

Order pronounced in the open court on 25-08-2026

Sd/- Sd/- (PRAKASH) (T.R. SENTHIL KUMAR) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated 25/08/2026 Dhananjay K., Sr. PS

आदेश क� ��त�ल�प अ�े�षत / Copy of Order Forwarded to:- 1. Assessee 2. Revenue 3. Concerned CIT 4. CIT (A) 5. DR, ITAT 6. Guard file. By order/आदेश से, सहायक पंजीकार आयकर अपील�य अ�धकरण, जयपुर

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