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Facts
The assessee, Maa Narmada Ganga Annakshetra, applied for registration under Section 80G(5) of the Income Tax Act, which was rejected by the CIT(Exemption). The CIT concluded that no expenditure on charitable activities was proven and expressed dissatisfaction with the genuineness of activities, despite the assessee claiming to have submitted extensive documentary evidence.
Held
The Tribunal noted that the assessee's accounts were audited and found it appropriate to restore the matter to the CIT(Exemption). The assessee was directed to furnish any additional relevant material required by the CIT to establish that funds were spent on the charitable activities for which provisional registration had been granted.
Key Issues
Whether the CIT(Exemption) was justified in rejecting the assessee's application for 80G registration due to lack of satisfaction regarding the genuineness of charitable activities and proof of expenditure, especially when the assessee asserted that all relevant documents had been submitted.
Sections Cited
80G, 80G(5), 12A
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, LUCKNOW ‘B’ BENCH, LUCKNOW
A.Y. 2025-26 Maa Narmada Ganga Annakshetra, vs. CIT, Exemption Etra D 6 Ugrasen Nagar, Haridwar Road Rishikesh 249202, Uttarakhand PAN: AAETM6243R (Appellant) (Respondent) Assessee by: Sh. Jitendra Wadhwa, C.A. Revenue by: Sh. H.S. Usmani, CIT DR Date of hearing: 11.08.2025 Date of pronouncement: 28.08.2025 O R D E R PER NIKHIL CHOUDHARY, A.M.: This is an appeal filed by the assessee against the order of the ld. CIT(Exemption), rejecting the application of the assessee for registration under section 80G of the Income Tax Act, 1961. The grounds of appeal are as under: - “1) That having regard to the facts and circumstances of the case, the Ld. CIT Exemptions has erred in law and on facts in rejecting the application of the assessee for registration U/s 80G of Income Tax Act, 1961. 2) That having regard to the facts and circumstances of the case, the Ld. CIT Exemptions has erred in law and on facts in rejecting the application of the assessee on the ground that he is unable to arrive at the satisfaction about the charitable nature of activities whereas the assessee had tried to submit all the possible documents available with it to prove the genuineness of the charitable activities of the institution. 3) That having regard to the facts and circumstances of the case, the Ld. CIT Exemptions has erred in law and on facts in stating in the rejection order that the assessee has failed to furnish the documentary evidences such as photos, news coverage by media whereas the assessee has submitted all these documents in its reply dated 11.11.2024 vide acknowledgment No. 691756331111124 which clearly establish the fact that assessee fulfill the aims & objects which is mentioned in the Trust Deed.
1. Maa Narmada Ganga Annakshetra A.Y. 2025-26 4) That having regard to the facts and circumstances of the case, the Ld. CIT Exemptions has erred in law and on facts in rejecting the application without considering the all the relevant documents such as photographs, Financials, Bank statement, Trust deed, declarations produce by the assessee in the reply. 5) That having regard to the facts and circumstances of the case, the Ld. CIT Exemptions has erred in law and on facts in framing the order by not following the Principles of Natural Justice. 6) That the appellant craves the leave to add, modify, amend or delete any of the grounds of appeal at the time of hearing and all the above grounds are without prejudice to each other.”
2. The facts of the case are that the assessee filed an application for the registration of the trust under section 80G(5) of the Income Tax Act, 1961 on 28.05.2024, in Form No.10B, as per the provisions of Rule 17A of the Income Tax Rules, 1962. In response to the notices issued to the assessee, the assessee was required to furnish documentary evidences to substantiate the charitable activities carried out by it in the recent past. In response, the assessee filed a part reply. From examination of this part reply, the ld. CIT(Exemption) concluded that no expenditure had been incurred on charitable activities, as per the objects mentioned in the trust deed and no supporting bills and vouchers had been filed in support of its claim. The assessee was issued a questionnaire and asked to submit the same but the ld. CIT(Exemption) records that the same was not complied with. As a result, he held that the genuineness of charitable activity could not get established. He, therefore, concluded that the activities of the society that are claimed to have been carried out for charitable purposes as per the objects of the trust, were not genuine and since he could not make any verification of the objects of the trust as per the trust deed with the activities carried out, he recorded his dissatisfaction about the charitable nature of the activities of the assessee trust. Therefore, he rejected the application filed in Form 10AB for registration under section 80G(5) of the I.T. Act and also proceeded to initiate proceedings for cancellation of provisional registration granted under section 80G(5) on 31.12.2021.
3. The assessee is aggrieved at this rejection of its application under section 80G(5) of the Act. Sh. Jitendra Wadhwa, C.A. (hereinafter referred to as the ld. AR) 2 Maa Narmada Ganga Annakshetra A.Y. 2025-26 submitted that the assessee was a trust established with the aim of providing relief to the poor. It provides meals to orphans and old age people, free of cost, at lunch time and presently around 150 to 200 needy persons avail of this benefit every day. The trust also does counselling of children who had been abandoned by their families and visit the trust for food and shelter. The assessee had been granted registration under section 12A of the Income Tax Act, on 23.09.2021 which was applicable from assessment year 2022-23 to assessment year 2026-27. It was also granted provisional registration under section 80G on 31.12.2021 for the assessment years 2022-23 to 2025-26. The assessee thereafter filed Form 10AB for getting permanent registration on 28.05.2024 and it submitted the necessary documentary evidences and information during the 80G proceedings, but still the ld. CIT(Exemption) rejected the application for registration, under section 80G of the Act, stating that he was not satisfied about the charitable nature of the activities, which was completely against the principles of natural justice. The ld. AR submitted, that in response to the notice dated 4.11.2024, the assessee had submitted its reply on 11.11.2024 vide Acknowledgement No.691756331111124 and among the documents submitted were photographs of activities conducted, affidavits/declaration of trustees, annual accounts as on 31.03.2022, 31.03.2023 and 31.03.2024, Form10BD with donation details for F.Y. 2022-23 and F.Y. 2023-24 and the bank account statement for the F.Y. 2021-22 to 2022-23 and 2023-24. It was submitted that in spite of the submission of all these necessary documentary evidences, the ld. CIT(Exemption) rejected the application of the assessee stating that the assessee had failed to furnish documentary evidences and the Department was unable to arrive at satisfaction about the charitable nature of the activities. The ld. AR submitted that ld. CIT(Exemption) had not even mentioned the reply dated 11.11.2024 in his rejection order, when the said reply contained all the relevant documents for the case. It was, therefore, prayed that the rejection order under section 80G had been passed without proper application of mind. The ld. AR also filed a paper book containing the questionnaire issued by the ld. CIT(Exemption) and the reply filed by the assessee. It has also been certified that these documents were 3 Maa Narmada Ganga Annakshetra A.Y. 2025-26 placed before the ld. CIT(Exemption). On perusal of these documents, it is seen that the assessee has submitted the photographs of shelter being provided to homeless people, advertisements of free camps for examining blood and blood pressure, photographs of daily “Bhandara”, conducted at premises of the assessee trust and also provided a copy of its accounts, which show that the major expenditures incurred by the trust are on purchase of food items, labour paid for food, fuel and repairs and maintenance. It has also filed a certified copy of the trust deed and it has submitted that the examination of the same would show that the trust was for the benefit of the public at large and not for any individual. Copies of affidavits of various trustees had been filed wherein the trustee have sworn not to utilize any portion of the trust for their own benefit but rather to ensure that the money of the trust is spent towards the objects of the trust, as enshrined in the trust deed. The paper book also contains copies of the provisional registration granted to the trust. It is seen that as per the same, the same was granted after considering the material available on record and the ld. AR has informed that there is no change in either the objects of the trust, or the activities of the trust since the grant of such registration. Accordingly, it was prayed that since the trust is devoted towards the needs of poor people, and its accounts are duly audited, the ld. CIT(Exemption) was not justified in rejecting the application under section 80G(5), without considering the documents filed by the assessee. Accordingly, it has been prayed that the matter may be kindly be restored back to the file of the ld. CIT(Exemption), so that the trust could furnish such further documentation as the ld. CIT(Exemption) may require, for satisfying himself with regard to the charitable nature of the trust.
4. On the other hand, Sh. H.S. Usmani, ld. CIT DR (hereinafter referred to as the ld. DR) submitted that the application had been rejected primarily because the assessee had not filed the complete details before the ld. CIT(Exemption). However, if the assessee undertook to furnish the complete details as required by the Maa Narmada Ganga Annakshetra A.Y. 2025-26 CIT(Exemption), then he had no objection to the matter being restored back to the file of the ld. CIT(Exemption) for a fresh decision, in accordance with law.
We have duly considered the rival arguments. The ld. CIT(Exemption) rejected the application of the trust on account of its failure to file proof of expenditure having been incurred towards the objects of the trust. Since, the accounts of the assessee are audited, the assessee should be in a position to produce the necessary evidences required by the ld. CIT(Exemption) to satisfy himself that the expenditure has been incurred in accordance with the objects of the trust. Accordingly, in the interest of justice, we restore the matter back to the file of the ld. CIT(Exemption) with a direction to the assessee to produce such other relevant material, which the ld. CIT(Exemption) may desire, so as to satisfy him that it has spent its funds on the activities on account of which provisional registration was granted to it. As the matter has been restored to the file of the ld. CIT(Exemption), the appeal of the assessee is held to be allowed for statistical purposes.