GOWD SARASWATH SAMAJ,AHMEDABAD vs. THE CIT(EXEMPTION), AHMEDABAD

This appeal has been filed by the Assessee against the order passed by the Ld. Commissioner of Income Tax (Exemption), (in short “Ld. CIT(E)”), Ahmedabad vide order dated 27.03.2024.

The brief facts of the case are that Ld. CIT(E) rejected the application for registration under Section 12A(1)(ac)(iii) of the Act and cancelled the provisional registration earlier granted to the assessee. The Ld. CIT(E), at Para 7 of the order held that the Assessee Trust has been carrying out religious activity by organizing religious functions.

The assessee is in appeal before us against the aforesaid order passed by Ld. CIT(E) rejecting grant of registration under Section 12A of the Act.

The Ld. Counsel for the assesseee submitted that the assessee is not involved in any religious activities, as is evident from the “objects of the Trust” and has only incurred minor expenses on the occasion of festivals like Ganesh Chaturthi and Ram Navami, which cannot be construed / interpreted as assessee being engaged in carrying out religious activities.

In response, the Ld. D.R. placed reliance on the observations made by Ld. CIT(E) in the order passed by him.

We have heard the rival contentions and perused the material on record.

On going through the facts of the instant case, we are of the considered view that merely incurring of expenditure on regular festivals cannot be a valid ground for rejecting the application for registration of Trust of the assessee under Section 12A of the Act, especially in light of the fact that on going through the “objectives” of the Trust, it is evident that the assessee has not been incorporated Gowd Saraswath Samaj vs. CIT(E) Asst.Year –N.A. - 3– for the purpose of carrying out religious activities. In light of the above, the matter is restored to the file of Ld. CIT(E), with a direction to examine the objectives of the assessee Trust in totality, to give an opportunity to the assessee and after taking into consideration all facts of the asessee on record, take a decision with regards to registration of Trust as per provision of Section 12A(1)(ac)(iii) of the Act.

In light of the above and in the interest of the justice, the matter is restored to the file of CIT (Exemptions), for de-novo consideration, after giving due opportunity of being heard to the assessee and with the direction not to disentitle the assessee for grant of registration only on the grounds as mentioned in its order for rejecting the application filed by the assessee trust.