2018 (7) TMI 2023 - AT - Income Tax

Tribunal grants section 80G approval to Trust for charitable activities.

The Tribunal allowed the Assessee's appeal, overturning the rejection of the application for a certificate under section 80G of the Income Tax Act. The ... Application for issue of certificate u/s. 80G rejected - charitable activity u/s 2(15) - CIT noticed from the records that the trust has not been able to obtain registration u/s.12A - HELD THAT:- It is seen that the main object of the Trust is to promote Education, to infuse inspiration, wishful though conception, piousness to religion into mass, to do welfare work in the society without any bar of any caste, community, colour or religion. We may also observe that the CIT, Valsad has denied the approval of Trust u/s.80G of the Act by observing that as per provision of section 80G(5)(vi) of the Income Tax Act, 1961 read with Rule 11AA(2)(i) of Income Tax Rule 1962, for the approval of an institution or fund under section 80G, registration of the trust under section 12A of the I.T.Act is essential. The Hon'ble Supreme Court in the case of M/s.Queen’s Educational Society vs. CIT [2015 (3) TMI 619 - Supreme Court] discussing therein various decision of Supreme court’s as well as High Court’s has held that the concern was charitable purposes as defined u/s.2(15) of the Act. when a Trust mainly engaged in spreading and promoting religious scriptures reading, distribute consecrated food, running gymnasium, upliftment of economically poorer sections of the society, doing sociocultural activities in society without any bar of any caste, filling devotions towards the country for human well being and contribute in imperative services like students education books, scholarships, foods and clothes etc,. then it cannot be said that the assessee Trust has ceased to exist for the purpose of charitable and education as provided u/s.2(15) of the Act. Therefore, we are of the considered opinion that the assessee is entitled for approval u/s.80G - Decided in favour of assessee. Issues:Appeal against rejection of application for certificate U/s.80G of the Income Tax Act.Analysis:The appeal was filed by the Assessee against the order of the Commissioner of Income Tax, Valsad, rejecting the application for a certificate U/s.80G of the Income Tax Act. The Trust in question was registered with the Assistant Charity Commissioner and had applied for registration U/s.12A of the IT Act. The Commissioner noted that registration under section 12A is essential for approval under section 80G. As the Trust had not obtained registration U/s.12A and did not fulfill all conditions under section 80G(5) and Rule 11AA(2)(i), the application was rejected. The Assessee contended that the Trust's activities were solely for education and human well-being, justifying the issuance of the certificate. The Departmental Representative relied on the CIT-II's orders.Upon reviewing the facts and material on record, it was observed that the Trust's main objective was to promote education, welfare work without discrimination, and religious activities. The denial of approval by the CIT was based on the requirement of registration under section 12A for section 80G approval. Citing relevant legal precedents, the Tribunal found that educational activities, even if conducted at cost, fall within the ambit of charitable purposes. It was emphasized that the Trust's activities aligned with the definition of charitable purposes under section 2(15) of the Act.In light of the Trust's engagement in spreading religious scriptures, educational initiatives, welfare activities, and socio-cultural endeavors, the Tribunal concluded that the Trust did not cease to exist for charitable and educational purposes as defined under the Act. Therefore, the Assessee was deemed entitled to approval under section 80G. The order of the CIT, Valsad was set aside, directing the granting of approval under section 80G to the Trust. Consequently, the appeal of the Assessee was allowed, with the order pronounced in open Court on the specified date.