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

P.P. Savani Knowledge City, Surat vs. The C.I.T. (Exemptions), Ahmedabad

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

ITA 818/AHD/2017[2016-17]Status: DisposedITAT Surat11 Jan 2019AY 2016-17

Bench: Smt. Diva Singh & Shri O.P.Meenaआ.अ.सं./I.T.A. No.818/Ahd/2017 िनधा"रण वष"/Assessment Year : 2016-17 P.P.Savani Knowledge City, Vs. The Income Tax Officer(Hq), Mansi Building, Sidhhkutir Exemption, Cit(Exemption), Industrial Estate, Kapodara, Ahmedabad – 380 009. Surat – 395 006. [Pan: Aaicp 0506 D] अपीलाथ" Appellant ""यथ"/Respondent Shri Hiren Vepari – Ca िनधा"रती क" ओर से /Assessee By Shri Prasenjit Singh – Cit-Dr राज"व क" ओर से /Revenue By 10.01.2019 सुनवाई की तारीख/ Date Of Hearing: 11.01.2019 उ"ोषणा क" तारीख/Pronouncement On आदेश /O R D E R Per Diva Singh, Jm: 1. The Present Appeal Has Been Filed By The Assessee Assailing The Correctness Of The Order Dated 25.01.2017 Of Cit(Exemption), Ahmedabad On The Following Grounds : “(I) Denial Of Registration U/S.80G(5) Of The Act: (1) On The Facts & Circumstances Of The Case & As Per Law, The Commissioner Of Income-Tax (Exemption) Was Not Justified In Refusing To Grant Registration U/S.80G(5) Of The Act To The Appellant. (2) The Appellant Submits That Commissioner Of Income-Tax (Exemption) Was Not Correct In Stating That On Account Of Non-Furnishing Of Information, Registration Was Refused When All The Information Called For Was Furnished. (3) Without Prejudice To The Above, Refusal To Grant Registration U/S.80G(5) Was On Grounds Which Were Not Relevant. (Ii) Miscellaneous: The Appellant Craves Leave To Add, Alter Or Vary Any Of The Grounds Of Appeal” 2. The Ld.Ar Inviting Attention To The Impugned Order Submitted That The Assessee Filed An Application For Registration Of The Trust U/S.80G(5) In Form No.10G Under Rule 11Aa Which Was Stated To Be Received By The Office

Section 80G(5)

Samskrita Bharati Dakshin Banga, Kolkata vs. CIT (Exemption), Kolkata

In the result, both these appeals of the assessee are allowed

ITA 2/KOL/2018[--------]Status: DisposedITAT Kolkata09 Jan 2019

Bench: Sri J. Sudhakar Reddy & Sri S.S. Viswanethra Ravi) & Sanskrita Bharati Dakshin Banga...................................…..……………….…...……..…….............Appellant C/O. V.N. Purohit & Co. Chartered Accountants Diaomond Chambers Unit-Iii 4Th Floor Suit No. 4G 4, Chowringhee Lane Kolkata – 700 016 [Pan : Aarts 3941 H] Vs. Commissioner Of Income Tax (Exemption), Kolkata......……………..………….…................Respondent Appearances By: Shri V.N. Purohit, Fca & Shri H.V. Bharadwaj, Fca, Appeared On Behalf Of The Assessee. Shri R. Shyam, Cit D/R. Appearing On Behalf Of The Revenue. Date Of Concluding The Hearing : November 26Th , 2018 Date Of Pronouncing The Order : January 9Th , 2019 Order Per J. Sudhakar Reddy, Am :- Both These Appeals Are Filed By The Assessee Directed Against Identical Orders Of The Learned Commissioner Of Income Tax (Exemptions), Kolkata (The ‘Ld. Cit(E)’), Rejecting Registration U/S 12Aa Of The Income Tax Act, 1961 (The ‘Act’) In Ita No. 01/Kol/2018 & Denying Approval For Exemption U/S 80G Of The Act In Ita No. 02/Kol/2018. 2. There Is A Delay Of 63 Days In Filing Of Both These Appeals. After Perusing The Petition For Condonation, We Are Convinced That The Department Was Prevented By Sufficient Cause From Filing The Appeals On Time. Hence The Delay Is Condoned & Appeal Admitted. 3. After Hearing Rival Contentions, We Find That The Ld. Cit(E) Has Rejected The Application Of The Assessee For Grant Of Registration U/S 12Aa Of The Act, By Holding As Follows:-

Section 12ASection 80G

Samskrita Bharati Dakshin Banga, Kolkata vs. CIT (Exemption), Kolkata

In the result, both these appeals of the assessee are allowed

ITA 1/KOL/2018[-----------]Status: DisposedITAT Kolkata09 Jan 2019

Bench: Sri J. Sudhakar Reddy & Sri S.S. Viswanethra Ravi) & Sanskrita Bharati Dakshin Banga...................................…..……………….…...……..…….............Appellant C/O. V.N. Purohit & Co. Chartered Accountants Diaomond Chambers Unit-Iii 4Th Floor Suit No. 4G 4, Chowringhee Lane Kolkata – 700 016 [Pan : Aarts 3941 H] Vs. Commissioner Of Income Tax (Exemption), Kolkata......……………..………….…................Respondent Appearances By: Shri V.N. Purohit, Fca & Shri H.V. Bharadwaj, Fca, Appeared On Behalf Of The Assessee. Shri R. Shyam, Cit D/R. Appearing On Behalf Of The Revenue. Date Of Concluding The Hearing : November 26Th , 2018 Date Of Pronouncing The Order : January 9Th , 2019 Order Per J. Sudhakar Reddy, Am :- Both These Appeals Are Filed By The Assessee Directed Against Identical Orders Of The Learned Commissioner Of Income Tax (Exemptions), Kolkata (The ‘Ld. Cit(E)’), Rejecting Registration U/S 12Aa Of The Income Tax Act, 1961 (The ‘Act’) In Ita No. 01/Kol/2018 & Denying Approval For Exemption U/S 80G Of The Act In Ita No. 02/Kol/2018. 2. There Is A Delay Of 63 Days In Filing Of Both These Appeals. After Perusing The Petition For Condonation, We Are Convinced That The Department Was Prevented By Sufficient Cause From Filing The Appeals On Time. Hence The Delay Is Condoned & Appeal Admitted. 3. After Hearing Rival Contentions, We Find That The Ld. Cit(E) Has Rejected The Application Of The Assessee For Grant Of Registration U/S 12Aa Of The Act, By Holding As Follows:-

Section 12ASection 80G