Appeal allowed, refusal set aside u/s 80G(5)(vi) of Income-tax Act, remanded for fresh consideration.

The Tribunal allowed the appeal, setting aside the refusal of approval u/s 80G(5)(vi) of the Income-tax Act, 1961, and remanded it for fresh consideration. It found the contradiction between the approval u/s 12A and the refusal of approval u/s 80G(5)(vi) to be inconsistent, directing the Commissioner of Income-tax to reconsider the application based on the genuineness of the trust's activities. The decision was rendered on 20th July 2018.

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Issues:
- Appeal against refusal of approval u/s 80G(5)(vi) of the Income-tax Act, 1961.
- Contradiction between approval u/s 12A and refusal of approval u/s 80G(5)(vi).
- Requirement of genuineness of activities for approval u/s 80G(5)(vi).
- Application of legal precedents in similar cases.

Analysis:
1. The appeal was filed against the refusal of approval u/s 80G(5)(vi) of the Income-tax Act, 1961 by the Commissioner of Income-tax(Exemptions), Bengaluru. The appellant, a charitable trust formed to propagate ancient Indian culture through education, had obtained registration u/s 12A of the Act, but approval u/s 80G(5)(vi) was denied.

2. The appellant contended that the conditions for registration u/s 12A, including the genuineness of activities, were satisfied, leading to the grant of registration. It was argued that the same genuineness of activities should apply for approval u/s 80G(5)(vi). Citing legal precedents, the appellant highlighted that absence of activities at the time of registration cannot be a basis for refusal of approval u/s 80G(5)(vi).

3. The Tribunal referred to a case where the High Court held that registration cannot be refused solely based on absence of charitable activities at the time of application, especially when the trust is newly formed. The Tribunal emphasized that the genuineness of the trust's objects should be considered for registration, not the immediate activities. Therefore, the Tribunal allowed the appeal, setting aside the refusal of approval u/s 80G(5)(vi) and remanding it for fresh consideration.

4. The Tribunal noted the contradiction between the approval u/s 12A and the refusal of approval u/s 80G(5)(vi). It concluded that by granting registration u/s 12A, the CIT had implicitly accepted the genuineness of the trust's activities, making the refusal of approval u/s 80G(5)(vi) inconsistent. The Tribunal directed the CIT to reconsider the approval application in light of the legal principles discussed during the appeal hearing.

5. In the final order, the Tribunal allowed the appeal for statistical purposes, indicating that the refusal of approval u/s 80G(5)(vi) was set aside, and the matter was remanded for fresh consideration. The decision was pronounced in an open court on 20th July 2018.

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