C L SHAH CHARITABLE TRUST,VADODARA vs. THE CIT(EXEMPTION), AHMEDABAD

The assessee, in this appeal, is aggrieved by the order of the CIT(E) in rejecting the application of the assessee for regular/final approval under clause (iii) of first proviso to sub-section (5) of Section 80G of the Income Tax Act, 1961 (in short “the Act”) C.L. Shah Charitable Trust vs. The CIT (Exemption)

Before us, the Ld. Counsel for the assessee has submitted that the ld.CIT(E) got the impression from the accounts of the assessee that the assessee had incurred expenditure on religious purpose more than the prescribed limit. She has submitted that the Accountant of the assessee has wrongly mentioned the head of expenditure as donation for religious, whereas, the donation made by the assessee was not for any religious purpose, rather for charitable purposes. That it was a case of accounting mistake only. She has requested that the assessee has a fair case on merits. She has submitted that the matter may be remanded to the CIT(E), so that the Ld.CIT(E) can be apprised about the true and correct facts of the case.

The ld.DR, on the other hand, has relied upon the findings of the Ld.CIT(E). C.L. Shah Charitable Trust vs. The CIT (Exemption)

Considering the rival submissions, in our view, the interests of justice will be well served, if the assessee is given an opportunity to present its case before the Ld.CIT(E) and to demonstrate that the alleged expenditure on account of donation for religious purpose was, in fact, not for religious purpose and further to explain the purpose of loan of Rs.10 lakhs given in last three financial years to Shri Pancheshwar Mahadev Trust. The assessee will furnish all the requisite details/documents and explain its case before the Ld.CIT(E) and the Ld.CIT(E), after considering the same, will decide the application of the assessee afresh within six months from the date of receipt of copy of this order.