Section 12A of the Income Tax Act

Income-tax Act, 2025: ss.332–355

Section 12A of the Income-tax Act, 1961 corresponds to sections 332 to 355 of the Income-tax Act, 2025, the provisions on registered non-profit organisations.

Read the 2025 provisions

Correspondence checked against the ICAI tabular mapping of the two Acts and the BharatTax.co section commentary.

The decision most relied on for Section 12A is CIT v. Institute of Banking Personnel Selection (264 ITR 110), cited in 398 of the 6,064 judgments on BharatTax that turn on this section.

Leading authorities on Section 12A

CIT v. Institute of Banking Personnel Selection
264 ITR 110 · 2003 · High Court
398
citing judgments

Depreciation is allowable on assets for which the cost has been fully allowed as an application of income under Section 11 in previous years, when computing the income of a charitable trust. Charitable trusts are also entitled to carry forward their deficit.

ACIT v. Ahmedabad Urban Development Authority
143 Taxmann.com 278 · 2022 · Supreme Court
390
citing judgments

If activities for the advancement of general public utility are carried on as a business, income from such activities is not exempt under Section 11, even if the profits are utilized for the main charitable object. The argument that profits from general public utility activities can be ploughed back to charity to maintain exemption is not a good law.

Addl. CIT v. Surat Art Silk Cloth Manufacturers Association
121 ITR 1 · 1980 · Supreme Court
328
citing judgments

A charitable institution, whose predominant object is general public utility, can engage in non-charitable activities yielding incidental profits, provided these profits are deployed to achieve the dominant charitable object. A subsidiary object, if ancillary to the primary charitable purpose, does not negate the institution's charitable character.

Sole Trustee, Loka Shikshana Trust v. CIT
101 ITR 234 · 1975 · Supreme Court
323
citing judgments

This case defines 'education' under Section 2(15) of the Income Tax Act as systematic instruction, schooling, or training given to the young for preparation for the work of life. It clarifies that 'education' in this context has a narrow meaning, not extending to every acquisition of further knowledge.

Exide Industries Ltd. v. Union of India
292 ITR 470 · 2007 · High Court
320
citing judgments

The Calcutta High Court held that restricting deduction for leave encashment via Section 43B(f) was arbitrary and contrary to Supreme Court decisions. However, this judgment was later stayed by the Supreme Court.

Escorts Ltd. v. UOI
199 ITR 43 · 1993 · Supreme Court
267
citing judgments

A statute should not be construed to permit double deduction for the same expenditure unless specifically provided by law.

1. AIR 1951 SC 467: HARLA v. THE STATE OF RAJASTHAN. 2
2 SCC 453 · 1997 · Reported
222
citing judgments

When an appeal or revision is filed against an order passed by a subordinate forum, and a superior forum modifies, reverses, or affirms that decision, the order of the subordinate forum merges into the superior forum's decision, which then becomes the sole operative and enforceable order.

CIT v. Shri Plot Swetamber Murti Pujak Jain Mandal
211 ITR 293 · 1995 · High Court
204
citing judgments

A charitable trust can carry forward its excess expenditure from previous years and adjust it against the income of subsequent years, which qualifies as an application of income under Section 11. Additionally, voluntary contributions received for a specific purpose are treated as corpus funds and are not taxable.

CIT v. Gujarat Oil & Allied Industries
201 ITR 325 · 1993 · High Court
195
citing judgments

The requirement to file an audit report along with the income tax return, as specified in provisions like Section 80J(6A) or 80-IA(7), is directory and not mandatory. Substantial compliance is achieved if the audit report is submitted at any time before the assessment is framed or completed, and benefits should not be denied merely due to a delay in furnishing it.

CIT v. Society of the Sisters of St. Anne
146 ITR 28 · 1984 · High Court
195
citing judgments

Depreciation claimed by a charitable trust on its assets is an allowable application of income for computing exemption under Section 11, and this does not constitute a double deduction.

Judgments on Section 12A

Binayak Educational Charitable Trust, Berhampur vs. ITO, Exemption Ward, Berhampur

In the result, the appeal of the assessee is allowed for statistical purposes

ITA 519/CTK/2026[2018-19]Status: DisposedITAT Cuttack05 Jun 2026AY 2018-19

Bench: Shri George Mathan & Shri Rajesh Kumarआयकर अपील सं/Ita No.519/Ctk/2026 (धििाारणवर्ा / Assessment Year: 2018-2019) Binayak Educational Charitable Vs Ito, Exemption Ward, Berhampur Trust At-Nirmalya Hotel Nenana Hospital Road, Urban Bank Road, Berahmpur, Ganjam, Brahmapur, Odisha- 760001. Pan No. : Aabtb4888J (अपीलार्थी/Appellant) .. (प्रत्यर्थी / Respondent) धििााररतीकीओरसे /Assessee By : Shri P. K. Mishra & Himanshu Jena, Ars राजस्वकीओरसे /Revenue By : Shri Vijay Singh, Sr. Dr सुनवाईकीतारीख/ Date Of Hearing : 05/06/2026 घोषणाकीतारीख/Date Of Pronouncement : 05/06/2026 आदेश / O R D E R Perbench: This Is An Appeal Filed By The Assessee Against The Order Of Nfac, Delhi In Appeal No.Nfac/2016-17/10589971 Dated 11/05/2026 For The Assessment Year 2017-18. 2. Shri P. K. Mishra & Himanshu Jena, Ars Appeared On Behalf Of The Assessee Assisted By Miss Sahmita Kar & Shri Vijay Singh, Sr. Dr Represented On Behalf Of The Revenue. 3. It Was Submitted By The Ld. Ar That The Assessing Officer Has Treated The Assessee As Non-Cooperative. It Was The Submission That The Assessment Order Is Dated 16.04.2021. The Assessee Uploaded The Details On 03.03.2021, The Acknowledgement Reads As Follows:

For Appellant: Shri P. K. Mishra & Himanshu Jena, ARsFor Respondent: Shri Vijay Singh, Sr. DR
Section 80G

Orissa Assembly of Small and Medium Enterprises, Cuttack vs. Income Tax Officer, Exemption, Cuttack

In the result, appeal of the assessee is allowed

ITA 448/CTK/2026[2023-2024]Status: DisposedITAT Cuttack05 Jun 2026AY 2023-2024

Bench: S/Shri George Mathan & Rajesh Kumarassessment Year: 2023-24 Orissa Assembly Of Small & Vs. Income Tax Officer (Exemption), Medium Enterprises, Khapuria, Cuttack Cuttack Pan/Gir No. Aaato 1832 A (Appellant) .. ( Respondent) Assessee By : Shri Ambika Prasad Mohanty, Ca Revenue By : Shri Vijaya Singh, Ld Sr. Dr Date Of Hearing : 05/06/2026 Date Of Pronouncement : 05/06/2026 O R D E R Per Bench This Is An Appeal Filed By The Assessee Against The Order Of The Ld Addl/Jcit(A)- 9, Mumbai Dated 18.3.2026 In Appeal No. Addl/Jcit(A)-9, Mumbai/10061/2022-23 For The Assessment Year 2023-24. 2. Shri Ambika Prasad Mohanty, Ld Ar Appeared For The Assessee & Shri Vijaya Singh, Ld Sr Dr Appeared For The Revenue. 3. It Was Submitted By Ld Ar That The Return Filed By The Assessee Came To Be Processed & An Intimation Came To Be Issued U/S.143(1) On 4.12.2024, Wherein, The Assessee Has Been Denied The Benefit Of Registration U/S.12A Of The Act & The Entire Receipts Of The Assessee Has Been Brought To Tax. It Was The Submission That The Assessee Has Filed Rectification Application U/S.154 Of The Act, Which Was Rejected On 2 Assessment Year: 2023-24

For Appellant: Shri Ambika Prasad Mohanty, CAFor Respondent: Shri Vijaya Singh, ld Sr. DR
Section 11Section 12ASection 143(1)Section 154