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Facts
The assessee trust filed an application for registration under Section 12A(1)(ac)(iii) and for approval under Section 80G. The Ld. CIT(E) rejected the application, opining that sufficient documents were not provided to assess the genuineness of activities and the MOA compliance. Despite the Ld. CIT(E) acknowledging the commencement of charitable activities in FY 2021-22, the application was rejected.
Held
The Tribunal held that since the Ld. CIT(E) found that the assessee had already commenced its charitable activities, the rejection of the application for registration under Section 12A(1)(ac)(iii) was not sustainable. Consequently, the application for approval under Section 80G was also directed to be allowed.
Key Issues
Whether rejection of registration application under Section 12A(1)(ac)(iii) is sustainable when the Commissioner acknowledges commencement of charitable activities.
Sections Cited
12A(1)(ac)(iii), 80G(5)
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Income Tax Appellate Tribunal, DELHI BENCH “C”: NEW DELHI
Before: SHRI M BALAGANESH&
PER MADHUMITA ROY, JUDICIAL MEMBER: Both the appeals filed by the assessee are directed against the orders passed by the Learned Commissioner of Income Tax (Exemption), Chandigarh, rejecting application in Form 10AB for grant of registration under section 12A(1)(ac)(iii)B and 80G(5) of the Income Tax Act, 1961 respectively.
Heard the parties and perused the relevant materials available on record. The brief facts of the case are that an application for registration under Section 12A (1)(ac)(iii) of the Act was filed by the assessee-trust on 30.09.2024. The said application stood rejected. The Ld. CIT(E) is of the opinion that the sufficient documents have not been filed by the assessee for & 3002/Del/2025 assessing the genuineness of the activities of the Society. Neither, it could be verified from the available documents as to whether the applicant complied with the objects mentioned in the MOA or not. However, perusal of the income and expenditure account for year 31.03.2022 as submitted by the applicant, the Ld. CIT(E) is of the opinion that the Trust has been engaged in carrying out charitable activities during the Financial Year 2021-22 and thus, the commencement of the activities can be considered during the Financial Year 2021-22.
The provisional registration was granted by Ld. CIT(E) on 05.02.2024. It was further observed by the Ld. PCIT that as per the Act, post 01.10.2023, provisional registration cannot be granted/sought by a Trust or Institution which has not yet commenced its activities. It was, therefore, evident that the provisional registration have been granted as sought by the applicant as the applicant had already commenced its activities during Financial Year 2021-22. However, he ultimately rejected the application filed by the assessee filed in Form 10AB under Section 12A(1)(ac)(iii) of the Act.
Upon perusal of the matter passed by the Ld. CIT(E), it appears that once the Ld. CIT(E) was of the firm belief and concluded with the findings that the assessee had already commenced its charitable activities during Financial Year 2021- 22, rejection of the application made by the assessee under Section 12A(1)(ac)(iii) of the Act dated 30.09.2024 as considered to be not sought sustainable in the eyes of law.
& 3002/Del/2025 5. In that view of the matter, we dispose of this appeal by directing the Ld. CIT(E)with a direction upon him to grant registration to the assessee in terms of the application made under Section 12A(1)(ac)(iii) of the Act dated 30.09.2024. Consequently, the application for approval under Section 80G of the Act to be allowed by the Ld. CIT(E) with the aforesaid observations. Hence, both the appeals filed by the assessee are allowed.
In the result, both the appeals of the appellant/assessee are allowed.