SAMPRADAAYAM CULTURAL TRUST,SRIKAKULAM vs. INCOME TAX OFFICER (EXEMPTION WARD), VISAKHAPATNAM
Facts
The assessee, Sampradaayam Cultural Trust, applied for registration under Section 80G of the Income Tax Act, 1961, using Form 10AB. The Commissioner of Income Tax (Exemption) [CIT(E)] rejected the application, citing a lack of substantial charitable activities and non-compliance with provisions of Sections 12A and 80G. The assessee appealed the rejection, arguing that its activities are charitable and the rejection order was non-speaking.
Held
The Income Tax Appellate Tribunal found that the CIT(E) rejected the application without providing a speaking order or adequately discussing the charitable nature of the trust's objectives, despite the trust already holding Section 12A registration. The Tribunal determined that the trust's stated objectives indicate charitable activities and therefore directed the CIT(E) to grant registration under Section 80G to the assessee.
Key Issues
Whether the CIT(E) was justified in rejecting the application for Section 80G registration without a speaking order and proper consideration of the trust's charitable objectives, especially when the trust already possessed Section 12A registration.
Sections Cited
12A, 80G, 80G(5)(i)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, VISAKHAPATNAM “DIVISION” BENCH, VISAKHAPATNAM
Before: SHRI VEERAVALLI DURGA RAO, HON’BLE & SHRI S BALAKRISHNAN, HON’BLE
आदेश /O R D E R
PER SHRI VEERAVALLI DURGA RAO, JUDICIAL MEMBER: 1. This appeal is filed by the assessee against rejection order by the Learned Commissioner of Income Tax (Exemption), Hyderabad [hereinafter in short “Ld.CIT(E)”] vide DIN & Notice No. ITBA/EXM/F/EXM45/2024- 25/1071146636(1) dated 12.12.2024.
I.T.A.No.113/VIZ/2025 Sampradaayam Cultural Trust 2. Briefly stated facts of the case are, assessee has fled an e-application in Form No. 10AB seeking registration under section 80G of the Income-Tax act, 1961 (in short “Act”). Ld.CIT(E) issued Notice to the assessee in respect of proceedings under section 80G(5)(i) of the Act, to produce the copy of Memorandum of Association/Trust deed for verification and to furnish a detailed reply on the specific information called for in the said notice. In response, assessee has submitted some of the details as called for. Subsequently, another notice dated 27.11.2024 was issued to the assessee to submit the full information as per the notices issued. In response, assessee furnished its reply in compliance to the notice issued by the Ld.CIT(E). On considering the submissions of the assessee, Ld. CIT(A) rejected the application and issued Form No.10AD dated 12.12.2024.
Aggrieved by the rejection order assessee filed an appeal before us by raising following grounds of appeal: -
“1. The order of the learned Commissioner of Income Tax (Exemption), Hyderabad is contrary to the facts and also the law applicable to the facts of the case. 2. The learned Commissioner of Income Tax (Exemption) is not justified in rejecting the application filed by appellant in Form no.10AB for Registration u/s 80G of the Act. 3. Any other ground that may be urged at the time of appeal hearing.”
The only issue contested by the assessee is rejection of the Registration by the Ld.CIT(E). On this issue, Ld. Authorised Representative [hereinafter
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I.T.A.No.113/VIZ/2025 Sampradaayam Cultural Trust “Ld.AR”] submitted that assessee has filed Form No. 10AB seeking registration under section 80G of the Act and the same was rejected by the Ld.CIT(E) without any speaking order. Ld.AR also submitted that the activities carried out by the Trust are of charitable in nature and therefore pleaded that rejection order may be cancelled.
Per contra, Ld. Departmental Representative [hereinafter in short “Ld.DR”] relied on the order of the Ld.CIT(E).
We have heard both the sides and perused the material available on record. We observe that Ld.CIT(E) rejected the application of the assessee by observing as under:
“3. On perusal of the submission of the assessee, it is observed that no substantial charitable activities are being carried out by the assessee, which is in violation of the provisions of the section 12A and 80G of the IT Act. In light of the above facts, the present application in form 10AB for registration u/s. 80G is herewith rejected.”
On perusal of the order of the Ld.CIT(E), we find that the Ld.CIT(E) has not discussed anything except stating that the objectives of the trust does not fall under the charitable nature and rejected the application.After considering the objects of the Trust cited by Ld AR, we consider as per the objects of the Trust, they are carrying out activities of charitable in nature. The Ld.CIT(E) has casually observed without stating which of the objects are not charitable in nature. Further, registration under section 12A of the Act is
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I.T.A.No.113/VIZ/2025 Sampradaayam Cultural Trust also granted to the assessee. We therefore direct the Ld. CIT(E) to grant Registration under section 80G of the Act to the assessee. Accordingly, appealof the assessee is allowed.
In the result, appeal of the assessee is allowed.
Order pronounced in the open court on 13th May, 2025.
Sd/- Sd/- (एस बालाकृष्णन) (श्री िीरिल्ली दुर्ााराि) (S. BALAKRISHNAN) (VEERAVALLI DURGA RAO) लेखा सदस्य/ACCOUNTANT MEMBER न्याधयक सदस्य/JUDICIAL MEMBER Dated: 13.05.2025 Giridhar, Sr.PS आदेश की प्रनतनलनप अग्रेनर्त/ Copy of the order forwarded to :- 1. निर्धाररती/ The Assessee : Sampradaayam Cultural Trust District Collector’s Office Srikakulam – 532001 Andhra Pradesh 2. रधजस्व/ The Revenue : ITO-Exemption Ward Income Tax Office Infinity Tower Shankaramatham Road Santhipuram Visakhapatnam – 530016 Andhra Pradesh 3. The Principal Commissioner of Income Tax नवभधगीयप्रनतनिनर्, आयकरअपीलीयअनर्करण, नवशधखधपटणम /DR,ITAT, Visakhapatnam 4. 5. The Commissioner of Income Tax गधर्ाफ़धईल / Guard file 6. //True Copy// आदेशधिुसधर / BY ORDER Sr. Private Secretary ITAT, Visakhapatnam
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