2019 (11) TMI 1393 - AT - Income Tax

Tribunal overturns registration denial citing valid certification under sections 12A and 80G

The Tribunal allowed the appeal, finding the denial of registration under section 80G improper as the appellant possessed valid certification under ... Denial of 80G registration - Proof of charitable activity u/s 2(15) - assessee has obtained certificate u/s 12A - HELD THAT:- It is observed that assessee has obtained certification under section 12A, which has not been rejected or disputed by Ld. CIT(E). However, in impugned order Ld.CIT(E) is not doubting objects of assessee and has not brought anything on record to establish any violation of objects on behalf of assessee. We are therefore of the view, that assessee should not have been denied registration under section 80G of the IT Act, 1961. We accordingly set aside this issue back to Ld.CIT(A) to consider application filed by assessee dated 16/10/18 in accordance with law. Issues:Appeal against rejection of recognition under section 80G of the Act for assessment year 2017-18 to 2019-20.Analysis:The appeal was filed against the order rejecting recognition under section 80G of the Act for the mentioned assessment years. The appellant had applied under section 80G on 06/10/18 and had a valid certification under section 12AA of the Act. The appellant argued that the activities were charitable, and the CIT(A) erred in rejecting the application. The Senior DR relied on previous orders. Upon review, it was found that the denial of 80G registration was not sustainable as the appellant had certification under section 12A, which was not disputed by the CIT(E). The CIT(E) did not doubt the appellant's objects or show any violations. Consequently, the Tribunal concluded that the appellant should not have been denied registration under section 80G and remanded the issue back to the CIT(A) for proper consideration of the application filed by the appellant.The Tribunal observed that the denial of 80G registration lacked legal basis as the appellant had valid certification under section 12A, and there were no violations or doubts raised regarding the appellant's charitable activities. Therefore, the rejection of the application under section 80G was deemed incorrect. The Tribunal directed the CIT(A) to reevaluate the application in accordance with the law. The appeal was allowed in favor of the appellant, and the order was pronounced in open court on 29-11-2019.This judgment highlights the importance of proper evaluation and consideration of applications for recognition under section 80G of the IT Act, ensuring that decisions are based on legal grounds and factual evidence. It emphasizes the need for authorities to thoroughly review certifications and activities of applicants before rejecting such applications to uphold the principles of law and fairness in tax matters.