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Facts
The assessee trust filed an application for registration under section 12AB of the Income Tax Act, 1961, in Form No. 10AB. The CIT(E) rejected the application, holding it to be premature and non-maintainable because the trust was not provisionally registered. The assessee had not attached a self-certified copy of a previous registration order, as required.
Held
The Tribunal held that the process of registration under section 12AB is a preliminary stage to examine the genuineness of the trust's objects and activities, not an income assessment. The CIT(E) should have evaluated the explanation objectively and sought further clarifications rather than summarily rejecting the application.
Key Issues
Whether the CIT(E) was justified in rejecting the application for registration under section 12AB on the grounds that it was premature and non-maintainable due to the absence of provisional registration and a required document.
Sections Cited
12AB, 12A, 10(23C), 11
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Income Tax Appellate Tribunal, RAJKOT BENCH: RAJKOT
Before: DR. ARJUN LAL SAINI & SHRI DINESH MOHAN SINHA
आयकर अपीलीय अिधकरण, राजकोट "ायपीठ, राजकोट । IN THE INCOME TAX APPELLATE TRIBUNAL, RAJKOT BENCH: RAJKOT BEFORE DR. ARJUN LAL SAINI, ACCOUNTANT MEMBER & SHRI DINESH MOHAN SINHA, JUDICIAL MEMBER आयकर अपील सं./I.T.A. No.46/Rjt/2024 (िनधा"रण वष" / Assessment Year : -NA-) Gohel Kelavani Trust बनाम/ The CIT (Exemptions) 112, Aditya Centre, Rajkot Ahmedabad – 380 015 Vs. Rajkot – 360 001 (Gujarat) "ायी लेखा सं./जीआइआर सं./PAN/GIR No. : AAATG 1452 C (अपीलाथ" /Appellant) .. (""थ" / Respondent) Assessee by : Shri Ashok Mehta, Ld.AR Revenue by : Shri Sanjay Punglia, Ld. CIT(DR) सुनवाई की तारीख / Date of Hearing 17 /03/2025 घोषणा की तारीख /Date of Pronouncement 7 /04/2025 आदेश / O R D E R PER DINESH MOHAN SINHA, JUDICIAL MEMBER: This appeal by the assessee is directed against the order passed by the Ld. Commissioner of Income Tax (Exemption), Ahmedabad [hereinafter referred to as “CIT(E)”], dated 09/01/2024, rejecting the application for registration under section 12AB of the Income Tax Act, 1961 (hereinafter referred to as “the Act”).
The brief facts of the case are that in response to the notices dated 13/10/2023 and 20/11/2023, the assessee-trust has furnished details/documents apart from details/documents uploaded along with the present application filed. From perusal of the details available on record, it is observed that the applicant/assessee has filed the present
ITA No.46 /RJT/2024 Gohel Kelavani Trust vs. CIT Exemptions Asst.Year : - NA application in Form No. 10AB under sub clause (iii) of clause (ac) of sub- section (1) of section 12A of the Act and from perusal of same it is observed that the same stipulates as “where the trust or institution has been provisionally registered under section 12AB, at least six months prior to expiry of period of the provisional registration or within six months of commencement of its activities, whichever is earlier." Therefore, from perusal of said provision, it is evident that the applicant/assessee can file application in Form No. 10AB under sub clause (iii) of clause (ac) of sub-section (1) of section 12A of the Act, only when the trust or institution has been provisionally registered. Further, the relevant Rule 17A of Income Tax Rules also mandates to file self- certified copy of existing order granting registration under section 12A or section 12AA or section 12AB, as the case may be, apart from other documents listed therein.
2.1. From perusal of the present application filed in Form No. 10AB, it is observed that in details of attachments listed therein against "Self certified copy of existing order granting registration under section 12A or section 12AA or section 12AB or clause (23C) of section 10 or section 80G, as the case may be the appellant has mentioned "-", i.e. no such order has been attached along with the present Form No. 10AB filed. It is matter of fact that assessee/applicant is not provisionally registered in Form No. 10AC u/s. 12AB of the Act. As discussed above, the applicant/assessee can file application in Form No. 10AB under sub ITA No.46 /RJT/2024 Gohel Kelavani Trust vs. CIT Exemptions Asst.Year : - NA clause (iii) of clause (ac) of sub-section (1) of section 12A of the Act, only when the trust or institution has been provisionally registered.
The CIT(E) observed that the assessee-trust is not provisionally registered u/s.12AB of the Act and, therefore, held that the present application filed in Form No.10AB under sub-clause (iii) of clause (ac) of sub-section (1) of section 12A of the Act is premature/non-maintainable and liable to be rejected and, accordingly, filed in Form No.10AB for the registration u/s.12AB of the Act is rejected. 4. Aggrieved by the order of CIT(E), the assessee is in appeal before us with following grounds of appeal: “1. The Learned CIT - Exemptions (Ahmedabad) erred in rejecting the 12A application filed by the trust. 2. The Learned CIT-Exemptions (Ahmedabad) erred in not granting enough opportunity of being heard to the trust to represent the matter in spite of specific request made for personal hearing ignoring the judgment of Hon'ble Gujarat High Court in the case of Chandubhai Waghela vs NFAC (Gujarat High Court - Special Civil Application No 8552 of 2022). 3. The Learned CIT Exemptions (Ahmedabad) erred in not pointing out specifically to the trust that the application is made in the wrong Form and not providing an opportunity to rectify the same. 4. The assessee craves leave to add, alter, amend or delete any of the above grounds of appeals.”
On perusal of the record, it is noted that the assessee trust had duly furnished documents apart from documents uploaded along with the application filed and had also never claimed exemption under section 11,
ITA No.46 /RJT/2024 Gohel Kelavani Trust vs. CIT Exemptions Asst.Year : - NA 12 or section 10(23C) of the Act. In light of such disclosure, the application was rightly filed under section 12A(1)(ac) of the Act.
5.1. The Ld.Authorized Representative (AR) for the assessee submitted that, instead of verifying the genuineness of the trust or examining its charitable objects and proposed activities, rejected the application treating it as non-maintainable. The approach of the Ld. CIT(E) appears to be excessively technical and contrary to the scheme of registration, particularly in a case where the assessee asserts that activities have not commenced.
5.2. The Ld.Departmental Representative (DR) for the Revenue did not object to the restoration of the matter to the file of the CIT(E) for a fresh adjudication on merits.
5.3. We have heard the rival submissions and perused the material available on record. It is a settled principle of law that the process of registration under section 12AB of the Act is not an assessment of income, but rather a preliminary stage to examine the genuineness of the trust’s objects and proposed activities. When the trust has explicitly stated that it has not filed returns as it had no activities and thus no income chargeable to tax, it was incumbent upon the Ld. The CIT(E) to evaluate such explanation objectively and to call for any further clarifications or proposed activity plan rather than summarily rejecting the application.
ITA No.46 /RJT/2024 Gohel Kelavani Trust vs. CIT Exemptions Asst.Year : - NA 5.4. In our considered view, the interest of justice would be served, if the matter is restored to the file of the Ld. CIT(E) for de novo adjudication. The assessee is directed to co-operate in the proceedings and furnish any further details that may be required to ascertain the genuineness of its claim. At the same time, the Ld. CIT(E) shall decide the matter on merits and in accordance with law, after granting due opportunity of being heard. The assessee may also be permitted to make necessary correction in the application in Form No.10AB under sub-clause (iii) of clause (ac) of sub-section (1) of section 12A of the Act.
5.5. In view of the foregoing discussion, we set aside the impugned order of the Ld. CIT(Exemption), Ahmedabad dated 09/01/2024 and restore the matter to his file for deciding the application for registration afresh and in accordance with law, after providing adequate opportunity of hearing to the assessee.
In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the Open Court on 7/ 04 /2025 at Rajkot. (DR. ARJUN LAL SAINI) (DINESH MOHAN SINHA) ACCOUNTANT MEMBER JUDICIAL MEMBER RAJKOT; Dated 7 /04/2025 ट".सी.नायर, व."न.स./T.C. NAIR, Sr. PS
ITA No.46 /RJT/2024 Gohel Kelavani Trust vs. CIT Exemptions Asst.Year : - NA आदेश क" ""त"ल"प अ"े"षत/Copy of the Order forwarded to : अपीलाथ" / The Appellant 1. 2. ""यथ" / The Respondent. संबं"धत आयकर आयु"त / Concerned CIT 3. 4. आयकर आयु"त(अपील) / The CIT(E)-Ahmedabad 5. "वभागीय ""त"न"ध, आयकर अपील"य अ"धकरण,राजोकट/DR,ITAT, Rajkot 6. गाड" फाईल / Guard file. आदेशानुसार/ BY ORDER, स"या"पत ""त //// उप/सहायक पंजीकार (Dy./Asstt.