INDIA INNOVATION RESEARCH CENTER,BANGALORE vs. CIT, BANGALORE

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ITA 1406/BANG/2015Status: DisposedITAT Bangalore25 January 2017AY 2012-134 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the quantum of activity cannot be a basis to deny recognition under Section 80G, especially when Section 12A registration is granted and exemption under Section 11 was allowed in scrutiny assessments. The Tribunal directed the CIT to grant recognition under Section 80G.

What were the facts?

The assessee, M/s India Innovation Research Center, was denied approval under Section 80G of the Income Tax Act, 1961, by the CIT (Exemption). The CIT's objection was that the assessee had not carried out major activities for which it was created, despite having registration under Section 12AA.

What were the issues?

Whether denial of 80G approval is justified solely on the ground of insufficient activity when 12AA registration is granted and exemptions under Section 11 have been allowed.

Which sections of the Income-tax Act were involved?

Section 80G,Section 12AA,Section 11

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Income Tax Appellate Tribunal, BANGALORE BENCH ‘A’, BANGALORE

Before: SHRI A. K. GARODIA & SHRI LALIT KUMAR

For Appellant: Shri Narayan Murthy, C. A
For Respondent: Shri G. R. Reddy, CIT DR

He placed reliance on the tribunal order rendered in the case of M/s Manipal Alumni of Nephrology Trust vs. CIT in & 549/bang/2013 dated 21.02.2014 copy on pages 136 to 143 of the paper book. He pointed out that in this case, the tribunal followed the judgment of Hon’ble Karnataka High Court rendered in the case of DIT (E) vs. Meenakshi Amma Endowment Trust, 354 ITR 219 wherein it was held that in a case where the assessee approaches for registration u/s 12A within a short period of its formation, only the objectives of the trust for which it was formed would have to be examined to satisfy oneself about genuineness of the activities of the trust and carrying out of activities cannot be insisted for registration. He submitted that by following this judgment, the tribunal granted registration u/s 12A and also granted recognition u/s 80G. As against this, Learned DR of the revenue supported the order of CIT (Exemption).

4.

We have considered the rival submissions and in our considered opinion, in the facts of the present case as discussed above, it cannot be said that there is no activity of the assessee. The quantum of activity cannot be a basis to deny recognition u/s 80G particularly when registration u/s 12A is already granted and exemption u/s 11 in scrutiny assessment is also allowed for A. Y. 2013 – 14 & 2014 – 15 as

per assessment orders u/s 143 (3) for these two years available in the paper book. We therefore, direct the learned CIT (Exemption) to grant recognition to the present assessee u/s 80G.

5.

In the result, the appeal of the assessee is allowed.

Order pronounced in the open court on the date mentioned on the caption page.

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