UDYA DBANU SAHASRABHA FOUNDATION,MUMBAI vs. CIT (EXEMPTIONS), MUMBAI

These are two appeals preferred by the Assessee which were heard together and are being disposed of by way of a common order since the grounds raised arise from common factual matrix. 2. We would first take up ITA No.1231/Mum/2025 which has been preferred by the Assessee against the order, dated 27/01/2025, passed by Commissioner of Income Tax (Exemption), Mumbai

The Assessee has raised following grounds of appeal : “1. That the learned CIT(Exemption) erred in disregarding the fact that the Appellant is carrying out genuine charitable activities within India and there is no intention of carrying charitable activities outside India.

That the learned CIT(Exemptions) failed to appreciate that the Appellant has duly complied with providing all necessary documents to establish its eligibility for registration under Section 12A and approval under Section 80G.

That the rejection order is causing the hardship to the Appellant in conducting the charitable activities.

The Appellant has placed application for modification in its Object Clause of the Memorandum of Association (MOA) to Ministry of Corporate Affairs (MCA).

That the Appellant reserves the right to raise additional grounds at the time of hearing.”

The relevant facts in brief are that the Assessee is a charitable organization established on 16/05/2023, with the primary objective of education, relief of poor, medical relief and upliftment of the society and its people through its activities. The Assessee filed an application in Form 10AB under Section 12A(1)(ac)(iii) on 11/07/2024 before the Ld. CIT(E) seeking registration under Section 12AB of the Act. The CIT(E) rejected the aforesaid application vide order dated 27/01/2025 which has been impugned by way of the present appeal. It emerges that the rejection order was primarily based on the following reasons given by the Learned CIT(E):

2. The use of such words above referred objects in the MOA/trust deed clearly conveys its intention to utilise fund outside India, thereby leaving open the possibility for future endeavours, which may involve expenditure outside the country. The applicant Trust ought to have amended these clauses to align with the provisions of the Income Tax Act. However, it has failed to do so.”

The primary contention advanced on behalf of the Assessee is that the application filed by the Assessee for seeking approval under Section 12AB of the Act was rejected by the Learned CIT(E) on the ground that Memorandum of Association of the Assessee Company contained clauses conveying intention to utilized funds for charitable purpose outside India. During the appellate proceedings before the Tribunal,

Per contra Learned Departmental Representative submitted that at the relevant time the Memorandum of Association of the Assessee- Company that reflect intention to carry out the charitable activities outside India and therefore, the CIT(E) was justified in rejecting the application.

We have heard both the sides and have perused the materials on record. Given the facts and circumstances of the present case, we deemed it appropriate and in the interest of justice to set aside the impugned order passed by the Learned CIT(E) and restore the matter back to file of CIT(E) with the directions to adjudicate the application afresh after taking into consideration the amended Memorandum of Association in accordance with law. The Assessee is directed to file all the necessary documentary evidence in support of charitable activities of the Trust and amended Memorandum of Association before the Learned CIT(E). In terms of aforesaid, Ground No 1 and 4 are treated as allowed for statistical purposes while all the other Grounds raised by the Assessee are hereby dismissed as having been rendered infructuous.

In result in terms of paragraph 7 above, the present appeal preferred

The Assessee has raised following grounds of appeal : “1. That the learned CIT(Exemption) erred in disregarding the fact that the Appellant is carrying out genuine charitable activities within India and there is no intention of carrying charitable activities outside India.

That the learned CIT(Exemptions) failed to appreciate that the Appellant has duly complied with providing all necessary documents to establish its eligibility for registration under Section 12A and approval under Section 80G.

That the rejection order is causing the hardship to the Appellant in conducting the charitable activities.

The Appellant has placed application for modification in its Object Clause of the Memorandum of Association (MOA) to Ministry of Corporate Affairs (MCA).

That the Appellant reserves the right to raise additional grounds at the time of hearing.”

On perusal of impugned order, we find that the application filed by the Assessee for approval under Section 80G of the Act was rejected on account of rejection of application for registration under Section 12AB of the Act. Since we have set aside the order, dated 27/01/2025, whereby the application filed by the Assessee under Section 12AB of the Act was rejected by the Learned CIT(E), we deem it appropriate and in the interest of justice to set aside impugned order, dated 27/01/2025, with the directions to the Learned CIT(E) to decide the application under consideration filed for seeking approval under ITA No. 1230 & 1231/Mum/2025 Assessment Year: 2024-25

In result in terms of paragraph 11 above, the present appeal preferred by the Assessee is treated as allowed for statistical purposes.

In conclusion, both the appeals of the Assessee are treated as allowed for statistical purposes.

अपीलाथŎ/ The Appellant 2. ŮȑथŎ/ The Respondent. 3. आयकरआयुƅ/ The CIT 4. Ůधान आयकर आयुƅ / Pr.CIT 5. िवभागीयŮितिनिध ,आयकरअपीलीयअिधकरण ,मुंबई/ DR, ITAT, Mumbai 6. गाडŊफाईल