Section 12AA of the Income Tax Act

The decision most relied on for Section 12AA is ACIT v. Ahmedabad Urban Development Authority (143 Taxmann.com 278), cited in 390 of the 4,243 judgments on BharatTax that turn on this section.

Leading authorities on Section 12AA

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.

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.

Queen’s Educational Society v. CIT
372 ITR 699 · 2015 · Supreme Court
152
citing judgments

An educational institution that generates a surplus does not automatically lose its charitable status or cease to exist solely for educational purposes. This is true if the surplus is reinvested for its educational objectives, and the predominant object test determines if the institution's primary aim is education or profit.

Union of India v. Exide Industries
425 ITR 1 · 2020 · Supreme Court
146
citing judgments

The provision for leave encashment is allowable as a deduction only on an actual payment basis under Section 43B(f) of the Income Tax Act, 1961. The Supreme Court upheld the constitutional validity of Section 43B(f).

Sree Meenakshi Mills Ltd. v. Commissioner of Income Tax
31 ITR 28 · 1957 · Supreme Court
137
citing judgments

Expenditure incurred for commercial expediency, even without a direct or immediate benefit but indirectly facilitating business, is deductible as laid out wholly and exclusively for trade. The scope of reference jurisdiction under Section 66 is limited to questions of law, allowing challenges to Tribunal findings of fact only if they are perverse, unreasonable, or lack evidence.

R.B. Jodha Mal Kuthiala v. CIT
82 ITR 570 · 1971 · Supreme Court
131
citing judgments

Tax laws must be interpreted reasonably and in consonance with justice, even though equitable considerations are generally irrelevant in their interpretation.

Sarvodaya Charitable Trust v. ITO (Exemption)
125 Taxmann.com 75 · 2021 · High Court
129
citing judgments

The filing of Form 10B for claiming exemption under sections 11 and 12 is directory, not mandatory. A delay in filing Form 10B can be condoned, and exemption cannot be denied solely on this ground if the assessee satisfies other conditions and shows sufficient cause.

ACIT v. Surat City Gymkhana
300 ITR 214 · 2008 · Supreme Court
125
citing judgments

Once an institution receives registration under Section 12AA, the Assessing Officer must compute its income as per Section 11, focusing only on the application of income and not re-examining the charitable nature of its activities. The Supreme Court also clarified the meaning and scope of 'general public utility' under Section 2(15).

Judgments on Section 12AA

Sri Jaymal Jain Shravak Sangh, Bengaluru vs. Commissioner of Income Tax (Exemptions), Bengaluru

In the result, assessee’s appeal is allowed for statistical purposes

ITA 2210/BANG/2019[2019-20]Status: DisposedITAT Bangalore12 Feb 2020AY 2019-20

Bench: Shri N. V. Vasudevan & Shri A. K. Garodiaassessment Year : 2019-20 Sri Jaymal Jain Shravak Sangh, Commissioner Of C/O. Universal Trading Company, Income Tax (Exemptions), No.25/79, Renuka Building, 2Nd Floor, Vs. Bengaluru. A. M. Lane, Bengaluru – 560 053. Pan : Aavts 4568 G Appellant Respondent Assessee By : Smt. Suman Lunkar, Ca Revenue By : Shri. S. Tamil Selvam, Jcit (Dr)(Itat), Bengaluru Date Of Hearing : 16.01.2020 Date Of Pronouncement : 12.02.2020 O R D E R Per A.K. Garodiathis Appeal Is Filed By The Assessee & The Same Is Directed Against The Order Of Learned Cit(E), Bengaluru, Dated 19.08.2019, For The Assessment Year 2019-20, Under Section 12Aa Of The Income Tax Act, 1961. 2. Although The Assessee Has Raised As Many As 5 Grounds Of Appeal But The Only Grievance Of The Assessee Is Regarding Rejection Of The Assessee’S Claim For Registration Under Section 12Aa Of The Income Tax Act, 1961. 3. In The Course Of Hearing, It Was Submitted By Learned Ar Of The Assessee That The Impugned Order Passed By Learned Cit(E) Is Ex-Parte Qua The Assessee. He Also Pointed Out That This Is Also Noted By Learned Cit(E) In The Impugned Order That The Assessee Trust Filed Application Through E-Filing In Form No.10A On 22.02.2019 & Learned Cit(E) Issued A Notice On 14.08.2019 Asking The Assessee To Furnish Various Details But The Said Notice Issued By Learned Cit(E) Had Come Back Unserved With The Remarks Of The Postal Department That “No Such Person Returned To Sender”. He Submitted That Under These Facts, It Is Page 2 Of 2

For Appellant: Smt. Suman Lunkar, CAFor Respondent: Shri. S. Tamil Selvam, JCIT (DR)(ITAT), Bengaluru
Section 12A

Pens Sahyog Foundation, Thane vs. Commissioner of Income-Tax . (Exemption), Pune

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

ITA 1167/PUN/2019[2019-20]Status: DisposedITAT Pune07 Feb 2020AY 2019-20

Bench: Shri D. Karunakara Rao, Am & Shri Laliet Kumar, Jm आयकर अपील सं. / Ita No.1167/Pun/2019 िनधा"रण वष" / Assessment Year : 2019-20 Pens Sahyog Foundation, 15, 3Rd Floor, Ajita Enclave, Behind Chintamani Mandir, M.P. Road, Virar East, Thane-401303. .......अपीलाथ" / Appellant Pan : Aakcp0318B बनाम / V/S. Cit (Exemptions), ……""यथ" / Respondent Pune. Assessee By : None Revenue By : Shri Deepak Garg सुनवाई क" तारीख / Date Of Hearing : 05.02.2020 घोषणा क" तारीख / Date Of Pronouncement : 07.02.2020 आदेश / Order Per D. Karunakara Rao, Am: This Appeal Filed By The Assessee Is Against The Order Of The Cit (Exemptions), Pune Passed U/S 12Aa(1)(B)(Ii) Of The Act Dated 24.05.2019 For The Assessment Year 2019-20. 2. The Grounds Raised By The Assessee Are As Under :- “1.0 On Facts & Circumstances Of The Case & In Law, Ld. Cit (Exemption) Erred In Passing The Order U/S 12Aa Exparte Without Providing An Adequate Opportunity Of Being Heard & On Ignoring The Fact That The Non- Compliance Had Occurred Under The Bonafide Reasons & Compelling Circumstances Beyond Control Of The Appellant; 2.0 On Facts & Circumstances Of The Case & In Law, Ld. Cit (Exemption) Erred In Rejecting The Registration U/S 12A Of The Act;

For Appellant: NoneFor Respondent: Shri Deepak Garg
Section 12ASection 13(1)(c)

M/S St.Mary'S Church, Dakshina Kannada vs. Commissioner of Income Tax (Exemptions), Bangalore

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

ITA 2495/BANG/2018[2018-19]Status: DisposedITAT Bangalore30 Jan 2020AY 2018-19

Bench: Shri A. K. Garodia & Shri Pavan Kumar Gadaleassessment Year : 2018-19 M/S. St. Mary’S Church, The Commissioner Of Income Tax Guthigar, P.O. Sulya Tq., (Exemptions), D. K. Karnataka – 574 218. Vs. Bengaluru. Pan : Aants 9210 R Appellant Respondent Assessee By : Smt. Soumya K, Advocate Revenue By : Shri. C. H. Sundar Rao, Cit Date Of Hearing : 25.11.2019 Date Of Pronouncement : 30.01.2020 O R D E R Per A. K. Garodia, Am This Appeal Is Filed By The Assessee & The Same Is Directed Against The Order Of Learned Cit(E), Bengaluru, Under Section 12Aa Of The Income Tax Act, 1961 On 30.07.2018. 2. As Per The Grounds Raised By The Assessee, This Is The Only Grievance Of The Assessee That The Learned Cit(E) Was Not Justified In Rejecting The Application For Registration Made By The Assessee Under Section 12Aa Of The It Act. In The Course Of Hearing, It Was Pointed Out By Learned Ar Of The Assessee That The Assessee Trust Filed Application For Registration Under Section 12A On 24.01.2018 & A Letter Dated 17.07.2018 Was Issued By Cit (E) To The Assessee Calling For Certain Details / Clarifications & The Assessee Was Asked To Submit A Reply On Or Before 24.07.2018 & The Impugned Order Has Been Passed By Learned Cit(E) On 30.07.2018. He Submitted That On The First Page Of His Order, It Is Noted By Learned Cit(E) That The Assessee Has Filed A Reply On 26.07.2018 In Which The Assessee Sought Time Of 10 Days From 26.07.2018 But Since The Application Of The Assessee Is Getting Time Barred On 31.07.2018, He Rejected The Assessee’S Request For Granting Adjournment. He Page 2 Of 2

For Appellant: Smt. Soumya K, AdvocateFor Respondent: Shri. C. H. Sundar Rao, CIT
Section 12A