TaxTMI 
TaxTMI 
2025 (6) TMI 394
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....ience and brevity. 2. First we take up ITA No.4549/Del/2024 against the rejection of the application u/s 12A(1)(ac)(iii) of the IT Act. 3. Brief facts of the case:- The applicant had filed an application dated 08.02.2024 in Form 10AB for registration u/s 12A(1)(ac)(iii) which was rejected by the ld. CIT(E) vide order dated 29.08.2024 which is reproduced as under: The applicant has filed an application dated 08.02.2024 in Form 10AB for registration u/s 12A(1 )(ac)(iii) of the Income Tax Act, 1961. The applicant was issued a questionnaire dated 19.03.2024 with a request to furnish certain details I documents / clarifications in support of its claim of registration u/s 12A(1)(ac)(iii). The case was fixed for compliance on 03.04.2024. 2. In response, the applicant filed part details by way of financials, declarations, NOC, trust deed, Balance Sheet and Income & Expenditure for the year ending 31.03.2021 to 31.03.2023 etc. on 02.04.2024 and 19.04.2024. Hence, further opportunity was afforded vide letter dated 14.06.2024 to file pending details and some additional details / clarification / documents by 20.06.2024. It was also mentioned that in case of failure, the....
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....se of hearing, the assessee filed a written submission and paper book (pages 1 to 197). The assessee certified that the said documents were also filed before the ld. CIT(E). The written submission of the assessee is reproduced as under: "Denial of exemption certificate u/s. 12A The assessee, a charitable society, came into existence vide trust deed Dtd. 18.04.15, got registered on 30.12.15 with Sub-Registrar. - The founder of the trust deed are 03 doctors as under:- i. Dr. Sushant Gupta (MBBS, M.D., DM) Oncology, Director Balaji Action Cancer Hospital. ii. Dr. Samit Purohit (MBBS, M.D., DM) Oncology, Director Balaji Action Cancer Hospital. iii. Dr. Hari Goyal (MBBS, M.D., DM) Oncology, Director Max Cancer Hospital. The objects of the trust deed are as per trust deed including: - (5-8) (192, 187) * To organize seminars, conferences, continuing medical education. * To provide medicines to poor and needy. * To provide Tarpaulin for making tent for homeless people. * To provide financial help for treatment of poor and needy people. * To provide donation to other register....
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....s activity is clearly a charitable activity, eligible for Sec.12A. CASE LAW - Seminar/Conference Expn. In Medical Paediatric Pulmonology Programme Trust Vs. CIT [2015] 60 taxmann.com 158 (Chandigarh - Trib.) (Now Filed) Section 2(15), r.w.s. 12A and 12AA, of the Income-tax Act, 1961 - Charitable purpose (Medical relief) - Assessee-trust filed application for registration u/s. 12AA - Commissioner refused to grant registration by holding that activities of assessee-trust were nothing but adventure in nature of trade and would not fall in definition of 'charity' - It was found that aims and objects of assessee-trust clearly showed that it came into existence for providing medical assistance to poor patients and to promote research work on medical site and to hold conference etc., to create awareness and educating doctors especially paediatricians about respiratory disorders/diseases of children, etc - Further, accounts also showed that expenses were incurred for conferences and medicines for poor patients which were directly connected to achieve aims and objects of assessee-trust - Whether since assessee-trust existed for charitable purpose only, assessee wou....
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....vate bodies. Thus it can be said that in the given facts of the case, the other objects are a part of standard format of a trust deed whereas the main focus of the trust relates to the main objects of the trust i.e. to run hospital/nursing home, other medical relief, education, other relief of the poor. 7.2 Further clause 25 of the objects of the trust deed states that the Trust will do all other acts and things that are conducive or helpful to the advancement and fulfillment of the principal and other objects as mentioned at Sl. No. 1 to 24 of the trust. 7.3 Further clause 26 of the Trust deed wherein, 'conference and seminars' is mentioned as one of the object of the trust deed inter-alia states that in furtherance of the object of the trust, the society will undertake, 'conferences and seminars'. Clause 26 of the Trust deed is reproduced for ready reference as under:- 26) For above purpose and or in pursuance thereof undertake, execute, support and assist any programe(s) or project(s) with no profit motive designed to provide: research and studies into the problems of the marginalized, publishing of books, magazines, periodicals, pamphlets, brochures etc, in furth....
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.... by him that the bill submitted are mainly raised by hotel / resorts on account of food/banquet / rooms which are again not in nature of charity. 7.7. In this regard, the ld. AR has relied upon the decision of the ITAT, Chandigarh 'B' Bench in the case of Paediatric Pulmonology Programme Trust vs. CIT [2015] 60 taxmann.com 158 (Chd. Trib.) wherein the financial statements of the cited trust for the year ending 31st March 2014 revealed that except expenses amounting to Rs. 11,635/- debited under the head 'medicine for poor students', all other expenses debited in the income and expenditure are related to conference only. The Ld. AR relied upon the finding as arrived by the Tribunal in the said case that since the trust existed for the charitable purpose only and held that the assessee trust was eligible for registration u/s 12AA of the Act. The Tribunal in the cited case relied upon the decision of the Hon'ble Punjab & Haryana High Court in IT Appeal No.263 of 2013, vide order dated 28.04.2014 and the relevant discussion of the Tribunal in para no. 7 of the order is reproduced as under: "7. In this case the learned CIT denied the registration because no activities have y....
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....ad done some activities in achieving its aims and objects also. Therefore, the assessee trust is eligible for registration under s. 12AA of the Act. In view of the above discussion, we set side the order of the learned CIT-I, Chandigarh and direct him to grant registration under s. 12AA of the Act in accordance with law within one month from the date of receipt of the order." (Emphasis supplied) 7.8. Thus, we note that Chandigarh Bench of the Tribunal in arriving at the above decision for granting of registration to the society inter-alia noted that expenses were incurred for conferences and medicines for poor patients, which were directly connected to achieve the aims and objects of the assessee trust. However, the ld. CIT(E) has not made any such examination /verification of the details filed by the assessee before the Ld. CIT(E) and such verification is required before the decision relied by the assessee can be applied to the facts of the case of the assessee. 8. The other reason for the rejection given by the ld. CIT(E) was that the trustees as per submission made by the assessee are medical practitioners and doctors and at the same time donors are all pharmaceuticals ....
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....cision of Commissioner of Income-tax (Appeals), this Court held that e :: charitable institutions, tied-up grants received from donors if meant to be utilized for charitable purposes and not for other purposes, then those grants are non-taxable and thus, the charitable institutions are eligible to avail the benefits under sections 11 and 12 of the Act. The relevant paragraphs of the said decision are reproduced herein" "7. With regard to the second contention, the findings recorded by the tribunal are that the respondent- assessee had received grants for specific purposes/projects from the government, non-government, foreign institutions etc. These grants were to be spent as per the terms and conditions of the project grant. The amount, which remained unspent at the end of the year, got spilled over to the next year and was treated as unspent grant. The Commissioner of Income-tax (Appeals) while deleting the said addition had observed as under:- "I have considered the assessment order and submissions of the appellant along with evidences placed on record. On perusal of the evidences regarding the project grants placed on record, it is seen that the said amounts ar....
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....n absence of the same the applicability of the above decision of the Hon'ble Delhi High Court cannot be directly made applicable to the facts of the case of the assessee in favour of the assessee. Moreover, as discussed above the purpose of the seminars and conferences held by the assessee and assessee's claim on medical relief expenditure and donation to similar trust as per the details submitted in the written submission and the paper book has also not been examined by the ld. CIT(E), which requires factual verification by the Ld. CIT(E). Therefore, we are of the considered view that the order of the ld. CIT(E) dated 29.08.2024 rejecting the application of the assessee in Form No. 10 for grant of registration u/s 12A(1)(ac)(iii) cannot be sustained and the same is set aside to his file to pass a fresh order after giving a reasonable opportunity of being heard to the assessee and also keeping in view the above observations as made above and as per law. ITA No. 4548/Del/2024 10. Now, we taken up ITA 4548/Del/2024 regarding the rejection of application in Form 10AB for grant of approval u/s 80G(5)(iii) of the Act. 10.1. The ground of appeal filed by the assessee is as under....