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Facts
The assessee, Valmik Kayastha Kelvani Fund, applied for registration under section 12AB of the Income Tax Act. The CIT(E) rejected the application, stating that the re-drafted trust deed was not approved by the Charity Commissioner and thus the activities could not be verified. This was after a previous appeal where the Tribunal had set aside the issue to the CIT(E).
Held
The Tribunal held that the assessee was carrying out activities as per audited financials, which matched the objects in the trust deed. Since the objects were for the general public and the CIT(E) could not point out any specific community-based expenditure, the rejection of the application was not justifiable.
Key Issues
Whether the CIT(E) was justified in rejecting the application for registration u/s 12AB when the assessee's activities matched the trust deed's objects and complied with previous tribunal directions, and whether the rejection order was barred by limitation.
Sections Cited
12A, 12AB
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, SURAT “DB” BENCH, SURAT
Before: Dr. BRR Kumar, Hon’ble & Ms. Suchitra Kamble
आदेश/ORDER Per Suchitra Kamble, Judicial Member:
This is an appeal filed against the order dated 21-05- 2025 passed by CIT(E), Ahmedabad for assessment year 2022-23.
The grounds of appeal are as under:- “(1) The order of the CIT(E) subsequent to the directions of the Tribunal is barred by limitation.
I.T.A No. 757/Srt/2025 Valmik Kayastha Kelvani Fund, A.Y.2022-23
(2) On the facts and circumstances of the case and under the law, the learned CIT(E) was not justified in rejecting application u/s. 12A.
(3) The appellant having complied with the directions of the Tribunal in the first round, the learned CIT(E) should have granted registration u/s. 12A.
(4) The learned CIT(E) was not justified in not following the directions of the Tribunal in the first round of acceptance of the redrafted Trust Deed, and rejecting the application u/s. 12AB.
(5) Without prejudice to the above, in absence of the Trust Deed, the learned CIT(E) ought to have accepted the objects stated under the PTR of the office of the Charity Commissioner and examined activities.
(6) The above grounds are prejudiced to one another.
(7) The appellant craves leave to add, alter or vary any of the grounds of appeal.”
The assessee has made an application u/s. 12AB of the Income Tax Act, 1961 seeking registration vide application dated 12-08-2022. The said application was rejected vide order dated 27-02-2023. Against the said order, the application filed an appeal before the Tribunal and vide order 17-07-2023, the Tribunal set aside the issue to the file of the CIT(E). The CIT(E) observed that the assessee was granted provisional approval in Form 10AC under sub-section (vi) of clause (ac) of sub-section (1) of section 12A on 18-11-2021 from A.Y. 2022-23. The assessee was called upon to file certain details and the applicant submitted re-drafted trust deed before the CIT(E). The CIT(E) rejected the application on the ground that the assessee submitted only re-drafted trust deed which was not approved by the Charity Commissioner and hence could not verify the activity. The applicant filed the present appeal before the Tribunal on the ground that the same issue was raised in first round vide notice dated 18-02-2025 and was accepted and the 2
I.T.A No. 757/Srt/2025 Valmik Kayastha Kelvani Fund, A.Y.2022-23
issue which was already been reviewed and accepted was again taken into consideration and rejected on the very same ground by the CIT(E). The ld. A.R. pointed out that the activities undertaken as per audited financials matches with the objects specified in the trust deed (PTR).
The ld. D.R. relied upon the order of the CIT(E).
We have heard both the parties and perused the material available on record. It is pertinent to note that the applicant was carrying out the activities as per the audited financials which are identical to that of the objects mentioned in the PTR as well as in the redrafted trust deed. From the perusal of the redrafted deed, the object are not restricted to one particular community only but for all communities without any discrimination based on caste, creed, gender or religion. The CIT(E) could not point out from the financials that the expenditure was incurred for specific community only and not to the general public at large. Thus, it will be appropriate to allow the application of the trust for registration u/s. 12AB. Thus, the rejection is not justifiable and the plea of the applicant is allowed.
In the result, the appeal filed by the applicant/appellant is allowed. Order Pronounced in open court on 02.04.2026
Sd/- Sd/- (Dr. BRR Kumar) (Suchitra Kamble) Vice President Judicial Member Ahmedabad : Dated 02/04/2026 आदेश क� ��त�ल�प अ�े�षत / Copy of Order Forwarded to:- 1. Assessee 3
I.T.A No. 757/Srt/2025 Valmik Kayastha Kelvani Fund, A.Y.2022-23
Revenue 3. Concerned CIT 4. CIT (A) 5. DR, ITAT, Surat 6. Guard file. By order, Assistant Registrar, Income Tax Appellate Tribunal, Surat a.k.
Strengthened preparation & delivery of orders in the ITAT 1) Date of dictation 03/02/2026 2) Date on which the typed draft is placed before the 05/02/2026 (Copy of Dictating Member & Other Member ITA No. 690-Srt-2025)
3) Date on which the approved draft comes to the Sr. /02/2026 P.S./P.S. 4) Date on which the fair order is placed before the /02/2026 Dictating Member for pronouncement 5) Date on which the fair order comes back to the Sr. /02/2026 P.S./P.S. 6) Date on which the file goes to the Bench Clerk /02/2026 7) Date on which the file goes the Head Clerk 8) Date on which the file goes to the Assistant Registrar for signature on the order 9) Date of Dispatch of the order