ITO(E) WARD-2 AHMEDABAD, AHMEDABAD vs. SHREE ASANDAS B MURJANI EDUCATION TRUST, AHMEDABAD

The grounds of appeal are as under:-

The assessee made an application in Form 10A for registration u/s. 12AA of the Income Tax Act, 1961 on 23-02- 2019 for assessment year 2019-20 before the Assessing Officer. The Assessing Officer has not made any inquiry or asked for document till 05-08-2019 and on 05-08-2019 issued some letter which was received by the assessee. Thereafter on 30-08-2019, the Assessing Officer issued another letter which was received by the assessee and in compliance to the said letter, the assessee filed detailed submission on 10-09-2019. However, without considering the same, the Assessing Officer rejected the application of registration u/s. 12AA of the Income Tax Act, 1961 on 19-09-2019. The assessee again applied for registration u/s. 12AA of the Act on 23-10-2019 and the Assessing Officer granted the registration u/s. 12AA on 20-03-2020 w.e.f. assessment year 2020-21 instead of assessment year 2019-20. Since the assessee was not granted registration u/s. 12AA for assessment year 2019-20, the assessee filed return of income for assessment year 2019-20 on 22-10-2019 by declaring total income at nil. The same was processed and the assessee’s case was selected for scrutiny under reason that registration/approval under various sections of Income Tax Act have not been granted or cancelled/withdrawn. Accordingly, notice u/s. 143(2) of the Income Tax Act, 1961 was issued on 30-09-2020. Further notices u/s. 142(1) of the Act along with detailed questionnaire were issued on 30-07-2021, 25-08-2021 and 27-08-2021. In response to the notices issued u/s. 143(2) of the Act, the assessee trust vide letter dated 13-10-2020 submitted a copy of certificate u/s. 12AA of the Income Tax Act, 1961 issued by the 2 & 1224/Ahd/2025 Shree Asandas B Murjani Education Trust, A.Y. 2019-20 CIT(E) on 20-03-2020. Since the assessee has not been granted registration u/s. 12AA for assessment year 2019-20, the assessee was treated as a AOP(BOI). After taking cognizance of the assessee’s submissions, the Assessing Officer observed that the assessee has made revenue expenditure towards application of income for charitable or religious purposes or of the stated objects of the trust/institution to the tune of Rs. 2,45,00,281/- and claimed exemption u/s. 11(1)(c) of the Income Tax Act, 1961. Since the assessee was not a valid trust for assessment year 2019-20 due to non-possession of certificate u/s. 12AA of the Act, therefore claim of exemption u/s. 11(1)(c) of the Act remains invalid. Thus, the expenditure amounting to Rs. 2,45,00,281/- was disallowed and the amount is restricted to its voluntary contribution of Rs. 2,32,83,394/- which was received by the assessee trust during the year under consideration.

The ld. D.R. relied upon the order of the Assessing Officer as well as the order of the CIT(A). He submitted that the CIT(A) was not justified in deleting addition on account of denial of exemption u/s. 11(1)(c) of the Act.

The ld. A.R. relied upon the order of the CIT(A). & 1224/Ahd/2025 Shree Asandas B Murjani Education Trust, A.Y. 2019-20 We have heard both the parties and perused all the 7. relevant material available on record. Since the assessee has been granted registration u/s. 12AA as per the directions of the Hon’ble Tribunal in assessee’s own case for assessment year 2019-20 order dated 13-12-2023, the CIT(A) was right in directing the Assessing Officer to grant exemption u/s. 11(1)(c) of the Income Tax Act for assessment year 2019-20. There is no need to interfere with the findings of ld. CIT(A). Hence, the appeal of the Revenue being is dismissed.

In the result, both the appeals of the Revenue are dismissed.