2021 (4) TMI 488 - AT - Income Tax

Tribunal grants appeal, directs assessee to provide complete evidence for charitable registration

Krishna Shiksha Sewa Sansthan Versus The Commissioner of Income Tax (Exemption), Lucknow

The Tribunal allowed the appeal for statistical purposes, setting aside the Commissioner's order rejecting registration under section 12A of the Income ... Exemption u/s 11 - application of the assessee for registration u/s. 12A rejected - unverified Receipt of donations - non furnishing of bills in support of the expenditure as well as the evidence to prove that the assessee has actually carried the medical services to the poor by organizing medical camps and running medical clinics - HELD THAT:- There is no quarrel on the point that while granting the registration u/s. 12A the competent authority (Commissioner) is required to satisfy himself about the charitable nature of the objects of the trust/institutions and genuineness of the activities. Charitable nature of the objects of the assessee society is concerned, the CIT (Exemption) has not doubted the charitable nature of the objects which are duly stated in the memorandum and rules of the society and available with the Commissioner (Exemption). The only precondition which the assessee was required to satisfy the Commissioner (Exemption) is the genuineness of the activity to achieve the objects of the assessee society. So far as the confirmation of the donations are concerned since the assessee has explained the cause of incomplete confirmation as time constrains therefore, we find that the assessee ought to have been granted sufficient time for submitting the confirmation of donations. The second objection is regarding the genuineness of the activities and proof of providing the medical services to the poor by organizing medical camp running medical clinics. Though, the Commissioner (Exemption) has observed that the said claim is not supported by the evidence however, we find force in the contention of the assessee that the assessee was not specifically asked by the Commissioner to produce such evidence - we set aside the impugned order of the Commissioner (Exemption) and remit the matter to the record of the Commissioner (Exemption) for deciding the same afresh after giving one more opportunity to the assessee to submit the complete confirmation of donations as well as other documentary evidence in support of carrying out the activities of providing medical services to the poor in the rural areas - Appeal of the assessee is allowed for statistical purposes. Issues:1. Rejection of registration u/s. 12A of the Income Tax Act2. Non-submission of confirmation of donations3. Lack of evidence supporting charitable activitiesAnalysis:1. The appeal challenged the rejection of registration u/s. 12A of the Income Tax Act by the Commissioner (Exemption) based on various grounds raised by the assessee. The Ld. AR contended that the observations made by the Commissioner were contrary to the record and that the assessee had provided relevant particulars and documentary evidence to support their application for registration.2. The Ld. CIT DR argued that the rejection was based on multiple reasons, including the absence of confirmation of donations and lack of evidence supporting the claimed charitable activities. The Commissioner noted that the assessee failed to provide material to substantiate the charitable nature of their activities and the genuineness of their claims.3. Upon reviewing the submissions and material on record, the Tribunal found that while the confirmation of donations was incomplete, the assessee had submitted some confirmations promptly. The Tribunal also noted that the Commissioner did not specifically request evidence supporting the medical services provided by the assessee, which led to a lack of documentary evidence. As the Commissioner did not doubt the charitable nature of the objects, the matter was remitted back for the assessee to provide complete confirmation of donations and documentary evidence supporting their charitable activities.In conclusion, the Tribunal allowed the appeal for statistical purposes, setting aside the Commissioner's order and directing the assessee to produce the required confirmation of donations and documentary evidence to support their charitable activities.