TaxTMI 
TaxTMI 
2024 (7) TMI 952
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....ed CIT(E) had erroneously erred in fact as well in law without appreciating that the statutory provisions allow to reject the renewal only in the cases of finding that activities are not genuine or had not complied with the provisions of other laws. 3. The appellant may please by allowed to add further grounds of the appeal and/or allowed to amend, alter, delete, change and/or raise further grounds during the pendency of these proceedings. 3. The facts of the case which can be stated quite shortly are as follows: The assessee before us is a trust and an application for registration of the trust u/s 12AB of the Income Tax Act, 1961, was filed electronically on 20/09/2022, by the assessee-trust, in Form No. 10AB, under Rule 17A of the I.T. Rules, 1962. Therefore, a notice was issued by the ld CIT(E ) to the assessee on 10/12/2022 with a request to furnish detailed note on the activities actually carried out by the trust as well as certain details and documents as mentioned in the notice. The above-mentioned inquiry about the actual activities of the trust was done by the Ld CIT(E ), in view of the mandatory provisions of the procedure for registration u/s 12AB of the Income Tax Ac....
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.... as has been settled by the Hon'ble Supreme Court in the case of CIT vs. Palghat Shadi Mahal Trust, reported in 120 Taxman 889, wherein in the case of a public charitable trust, the Hon'ble Apex court held that where the benefit is available to Muslims from all over the world, none of whom except in Kerala are backward classes, the provision of section 13(1)(b) would be attracted and therefore the trust is not entitled for exemption u/s 11 of the Act. In case of composite trust/institution, i.e. charitable cum religious, the provision of section 13(1)(b) of the Act, is not applicable. However, the said controversy was resolved by the Hon'ble Supreme Court in the case of CIT vs Dawoodi Bohara Jamat, reported in 43 taxmann.com 243, wherein the Hon'ble Apex Court held that the provision of section 13(1)(b) of the Act is applicable even to a composite trust/institution and held as under: "45. From the phraseology in clause (b) of section 13(1), it could be inferred that the Legislature intended to include only the trusts established for charitable purposes. That however does not mean that if a trust is a composite one, that is one for both religious and charitable pur....
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....rust in 1946. Therefore, the trust was in existence before the commencement of the Income-tax Act 1961, hence, even if the trust was created only for a particular community, ("LEVVA PATEL" caste under consideration) the Ld. CIT(E), could not have denied the registration of the trust, because at the time of registration, the section 13(1)(b) of the Act Income Tax Act 1961, was not in force. Moreover, ld Counsel stated that section 13(1)(b) of the Act, relates to assessment of trust and not for registration, therefore, the provision relied on by Ld. CIT(E), under section 13(1)(b) of the Act, is out of context and does not relate to assessee under consideration, therefore, the Ld. CIT exemption should not have denied the registration of the trust under section 12 AB of the Act. The Ld. Counsel also stated that "Leva Patel" is not a particular caste/community. For that the Ld. Counsel for the assessee relied on followings judgements: i. Hon'ble Gujarat High Court in the case of CIT. vs. Kutchi Dasa Oswal Moto Parivar Ambama Trust [2013] 2013 taxmann.com 212(Guj.) ii. Co-ordinate Bench of ITAT, Chandigardh in ITA No.74/Chd/2009 in the case of Himachal Pradesh Environment protection ....
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...., under consideration was in existence prior to commencement of the Income Tax Act, 1961. The provisions of section 13(1)(b) of the Income Tax Act 1961, is applicable to the trusts created or established after the commencement of Income Tax Act, 1961. However, as per the plain language of section 13(1)(b) of the Income Tax Act 1961, as noted above, states that "in the case of a trust for charitable purpose or a charitable institution created or established after the commencement of this Act, any income thereof if the trust or institution is created or established for the benefit of any particular religious community or caste" therefore, it is vivid that trust created prior to commencement of the Income Tax Act, 1961, the provisions of section 13(1) (b) of the Income Tax Act, 1961, would not be applicable to such trust, even if, such trust was established or created for the benefit of any particular religious community or caste. We find that assessee-trust, under consideration, was in existence since 1946, that is, prior to the Income-Tax Act, 1961, came into being. That is, the trust under consideration was created in 1946, however, the Indian Income Tax Act 1961, was come into for....