RYA METRO STAR TRUST,CHENNAI vs. CIT(EXEMPTIONS), CHENNAI

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ITA 1361/CHNY/2024Status: DisposedITAT Chennai22 July 2024Bench: SHRI MAHAVIR SINGH, VICE PRESIDENTAND SHRI MANOJ KUMAR AGGARWAL (Accountant Member)4 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal noted that the CIT(E) should have examined the trust deed to determine the nature of the trust's objects. Since the CIT(E) did not properly verify the trust deed, the matter was set aside.

What were the facts?

The assessee trust filed applications for registration under Section 12A(1)(ac)(iii) and Section 80G. The CIT(E) rejected these applications because the Form 10AB mentioned religious objects alongside charitable ones, which was claimed to be a typographical error.

What were the issues?

Whether the rejection of registration applications by the CIT(E) was justified based on a perceived discrepancy in the stated objects of the trust, and whether the CIT(E) properly examined the trust deed.

Which sections of the Income-tax Act were involved?

Section 12A(1)(ac)(iii),Section 80G,Section 12AB

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘A’ BENCH, CHENNAI

Before: SHRI MAHAVIR SINGHAND SHRI MANOJ KUMAR AGGARWAL

Hearing: 22.07.2024Pronounced: 22.07.2024

अपीलाथ� क� ओर से/Appellant by : Shri Kamal Chordia, FCA ��यथ� क� ओर से/Respondent by : Shri Nilay Baran Som, CIT सुनवाई क� तारीख/Date of Hearing : 22.07.2024 घोषणा क� तारीख/Date of Pronouncement : 22.07.2024 आदेश /O R D E R PER MAHAVIR SINGH, VICE PRESIDENT: These appeals by the assessee are arising out of the orders of the Commissioner of Income Tax (Exemption), Chennai dated 21.03.2024 & 14.03.2024, rejecting applications in Form No.10AB filed for seeking registration/approval/recognition u/s.12A(1)(ac)(iii) and clause (iii) of first proviso to sub-section (5) of section 80G of the Income Tax Act, 1961 (hereinafter the ‘Act’) respectively.

- 2 - & 1362/Chny/2024 2. The only common issue in these two appeals of assessee is as regards to the order of CIT(E) rejecting the application filed by assessee in Form No.10AB u/s.12A(1)(ac)(iii) seeking registration u/s.12AB of the Act for the reason that assessee has selected religious cum charitable object in Column No.5 of Form No.10AB which was typographical error. For this, assessee has raised various grounds which need not be reproduced.

3.

We have heard rival contentions and gone through facts and circumstances of the case. We noted that the CIT(E) rejected the assessee’s claim of registration only on one premise that in the application filed in Form No.10AB, the nature of activities mentioned by the trust as charitable but in object clause, it is mentioned religious as one of the objects. Before CIT(E), assessee accepted the mistake and requested for registration as charitable trust ignoring the religious object mentioned in application in Form No.10AB. Now before us, the ld.AR for the assessee only stated that the objects mentioned in the trust deed are charitable objects only and there is no religious object.

4.

When this was pointed out to ld.CIT-DR, he could not controvert the above fact situation.

- 3 - & 1362/Chny/2024 5. We noted that the CIT(E) should examine the trust deed and then find out whether assessee is a charitable or religious trust. But for the purpose of registration u/s.12AB, there can be charitable as well as religious activities and the trust has to be registered but for the purpose of section 80G, there cannot be religious trust. However, in any case, the CIT(E) has to examine the trust deed and accordingly decide the issue. Hence, we set aside the orders of CIT(E) and remand the matter back to his file for fresh adjudication after verifying the trust deed and objects mentioned in the trust deed. Accordingly, both the appeals of the assessee are allowed for statistical purpose.

6.

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

Order pronounced in the open court at the time of hearing on 22nd July, 2024 at Chennai.

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