RAVI KANTA MUNISUBRAT DASS JAIN MEMORIAL TRUST,CHANDIGARH vs. COMMISSIONER OF INCOME TAX (EXEMPTIONS), CHANDIGARH

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ITA 109/CHANDI/2025Status: DisposedITAT Chandigarh04 August 2025AY 2211-11Bench: SHRI LALIET KUMAR (Judicial Member), SHRI MANOJ KUMAR AGGARWAL (Accountant Member)2 pages
AI SummaryRemanded

What did the Tribunal hold?

The tribunal set aside the impugned order of the CIT(E) and restored the application for de novo adjudication. The CIT(E) was directed to verify the assessee's claim that its religious expenditure did not exceed the 5% threshold permitted by Explanation 5B to Section 80G.

What were the facts?

The assessee, Ravi Kanta Memorial Trust, filed an appeal against the rejection of its application for approval under Section 80G(5)(iii) by the CIT(E). The CIT(E) had denied approval, invoking Explanation 3 to Section 80G, finding that many of the trust's objects were religious in nature.

What were the issues?

Whether the rejection of Section 80G approval based on religious objects was valid, considering the assessee's contention regarding the 5% expenditure threshold for religious activities under Explanation 5B.

Which sections of the Income-tax Act were involved?

Section 80G

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘B’ BENCH, CHANDIGARH

Before: HON’BLE SHRI LALIET KUMAR, JM & HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM

Ravi Kanta Munisubrat Dass Jain CIT (Exemption) बनाम/ Memorial Trust Chandigarh. H. No 85, Sector 2, Vs. Chandigarh-160011 �थायीलेखासं./जीआइआरसं./PAN/GIR No. AADTR-5663-F (अपीलाथ�/Appellant) : (��थ� / Respondent) अपीलाथ�कीओरसे/ Appellant by : Sh. Harish Nayyar (CA) – Ld. AR ��थ�कीओरसे/Respondent by : Smt. Kusum Bansal (CIT) – Ld. DR (virtual) सुनवाईकीतारीख/Date of Hearing : 29-07-2025 घोषणाकीतारीख /Date of Pronouncement : 04-08-2025 आदेश / O R D E R Manoj Kumar Aggarwal (Accountant Member) 1. Aggrieved by the rejection of an application seeking approval u/s 80G(5)(iii) of the Act vide impugned order dated 27.06.2024 of Ld. CIT(Exemption), Chandigarh, [CIT(E)], the assessee is in further appeal before us. Having heard rival submissions, the appeal is disposed-off as under.

2.

Upon perusal of para-3 of the impugned order, it could be seen that the approval has been denied by invoking Explanation-3 to Sec.80G which provide that Charitable purpose would not include any purpose the whole or substantially the whole of which is religious in nature. The Ld. CIT(E) arrived at a finding that the many of assessee’s objects were religious in nature and accordingly, the approval was denied. The Ld. AR seeks reconsideration of impugned application in the light of Explanation 5-B which provide that in case of an institution or fund which incurs expenditure which is of a religious nature for an amount not exceeding five per cent of its total income in that previous year then it shall be deemed to be an institution or fund to which the provisions of this section would apply. It is the submission of Ld. AR that the assessee has not breached this threshold limit.

3.

In view of foregoing, we set aside the impugned order and restore the application back to the file of Ld. CIT(E) for de novo adjudication, inter-alia, by verification of aforesaid averments as made by Ld. AR. No other ground has been urged in the appeal.

4.

The appeal stand allowed for statistical purposes. Order pronounced on 04-08-2025.

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