NANGANALLUR SABHA AND PRIYA FINE ARTS TRUST,CHENNAI vs. CIT, EXMEPTIONS,, CHENNAI

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ITA 2335/CHNY/2025Status: DisposedITAT Chennai05 March 2026Bench: SHRI GEORGE GEORGE K (Vice President), SHRI S.R. RAGHUNATHA (Accountant Member)1 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal noted that the trust had only provided financial statements up to March 31, 2024, for its first year of operation and had subsequently undertaken charitable activities. While the CIT(E) rejected the application, the revenue did not seriously object to granting the assessee another opportunity to present necessary details.

What were the facts?

The assessee, a trust formed in December 2023 with objects of charity and education, was provisionally registered but its application for regular registration under Section 12AB and approval under Section 80G was rejected by the CIT(E). The CIT(E) cited that the trust's activities resembled a private music academy and lacked verifiable evidence of charitable work.

What were the issues?

Whether the assessee trust is entitled to registration under Section 12AB and approval under Section 80G, and if a further opportunity should be granted to prove its charitable activities.

Which sections of the Income-tax Act were involved?

Section 12AB,Section 80G

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘A’ BENCH, CHENNAI

Before: SHRI GEORGE GEORGE K & SHRI S.R. RAGHUNATHA

Hearing: 04.03.2026Pronounced: 05.03.2026

O R D E R

PER GEORGE GEORGE K, VICE PRESIDENT:

1.

These appeals filed by the assessee are directed against two orders of the Commissioner of Income Tax (Exemption), [CIT(E)] Chennai both dated 26.06.2025, rejecting Form No.10AB filed for seeking registration u/s.12AB and approval u/s.80G of the Income Tax Act, 1961 (hereinafter the ‘Act’).

2.

Common issues are raised in these appeals. Hence, they were heard together and are disposed off by this consolidated order.

& 2335/CHNY/2025 :- 2 -: 3. Brief facts of the case are as follows: The assessee is a trust established by the deed dated 16.12.2023. The objects of the assessee trust are relief to the poor and needy. It is stated that it also imparts musical education to deserving children. The assessee trust was provisionally granted registration by the CPC on 22.05.2024. The assessee’s application for regular/permanent registration was rejected by the CIT(E) by the impugned order dated 26.06.2025. The reason stated for rejecting assessee’s application is that assessee’s activities are akin to a private music academy and was not carrying on any charitable activities. Further, it was stated by the CIT(E) that assessee has not provided any verifiable evidence of substantial work on services provided to the weak section of the society.

4.

Aggrieved by the orders passed by the CIT(E) rejecting assessee’s application for registration u/s.12AB of the Act and approval u/s.80G of the Act, assessee has filed the present appeals before the Tribunal. The Ld.AR submitted that assessee trust was formed on 16.12.2023 and has only provided the financial statement up to 31.03.2024. It was stated that the charitable activities of the assessee trust for the period up to 31.03.2024 was very limited and only minuscule charitable activities had taken during the said period. It was submitted that & 2335/CHNY/2025 :- 3 -: subsequently assessee was carrying on charitable activities in accordance with the objects of the trust and expenditure has been incurred for various charitable activities. Therefore, it was prayed that assessee may be provided with one more opportunity to prove the activities of the trust are genuine and it is not existing primarily for profit motive.

5.

The Ld.DR supported the order of the CIT(E). However, the Ld.DR did not have a serious objection for granting one more opportunity to the assessee trust to furnish the necessary details to prove that it is entitled to registration u/s.12AB of the Act and approval u/s.80G of the Act.

6.

We have heard rival submissions and perused the material on record. The assessee has listed out the objects of the trust which are primarily charitable and educational without any profit motive. However, while filing the application for permanent registration, assessee trust had provided the financial statement only up to 31.03.2024 being the first year of its operations. It is submitted that subsequently assessee trust had undertaken several charitable activities in accordance with objects of the trust. On the facts of the instant case, we are of the view that assessee trust should be provided with one more opportunity to & 2335/CHNY/2025 :- 4 -: present its case. Accordingly, the issues raised in these appeals are restored to the files of the CIT(E). The assessee is directed to furnish the audited financials upto date along with the activities carried on with regard to the objects of the trust to the CIT(E). The CIT(E) is directed to afford a reasonable opportunity of hearing to the assessee trust and take a decision in accordance with law. It is ordered accordingly.

7.

In the result, the appeals filed by the assessee are allowed for statistical purposes.

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