AI Drafter 
TaxTMI 
TaxTMI 
2025 (7) TMI 812
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....to grant exemption sought by the assesseee 3. The Id. CIT Exemption erred in law as well as on the facts of the present case in not giving full opportunity to the assessee before rejecting of application made by the assessee and hence the rejection of application is bad in law and on facts of the present case 4. The Id. CIT Exemption erred in law as well as on the facts of the present case in holding the objects of the assessee for the benefit of a particular community which is incorrect on facts and hence such findings may be quashed 5. The Id. CIT Exemption erred in law as well as on the 0 facts of the present case in holding the activities of the assessee as non-genuine which is incorrect on facts and hence such findings may be quashed 6. The Id. CIT Exemption erred in law as well as on the facts of the present case in holding the dissolution clause of the assessee as not being charitable which is based on misinterpretation of facts on record and hence such findings are prayed to be quashed 7. The assessee prays your goodself indulgence to add, amend, modify or delete all or any ground of appeal on or before the date of hearing 2.2....
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....ble trust under the Rajasthan Public Trust Act, 1959 (refer clause (iv) PB 4). The trust is established on dt.28-11-1963 and the first trust deed is enclosed at PB 56-62. The trust deed was modified in the year 2018 and the revised instrument dt. 12-3-2018 is placed at PB 63-69. The assessee was also duly registered u/s 12A of the Income Tax Act since 10-5-2002 and a copy of the certificate u/s 12A is placed at PB 52. Later the assessee was again issued registration u/s 12A in form 10AC on dt.30-3-2022 from AY 2022-23 to AY 2026-27 with unique registration no. AAATA8639FE20213. In the new regime for charitable trusts, the assessee again filed form no. 10AB on dt.2-1-2024, a copy of which is placed at PB 32-40 for seeking registration u/s 12AB of the Act. The application was made under sub-section (iii) of clause (ac) of sub section (1) of section 12A. This application was rejected for three reasons as would appear from the last page of the order passed by the ld. CIT(Exemption) (herein after referred to as the CIT) precisely on the following three grounds: a. Discrepancy in dissolution clause-trust is revocable b. Object for the....
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....57;िशेषकर अनपढ़, बेरोजगार, विधवाओं की सहायता करना, उच्च शिक्षा प्राप्त करने वाले स्वजातीय महान्भावों का सहयोग करना। 3(4) पुष्कर में भ्रमण, धार्मिक, व सामाजिक कार्यो से बहार से आने वाले महानुभावों को आश्रम में ....
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....dered all the objects: In the order passed, the ld. CIT has not reproduced object no. 3(4) and 3(7) as the same is not appearing in the order at page 5-6 of the order where this issue is considered. Apparently, the ld. CIT has failed to take into consideration two vital clauses which were directly linked to the charitable activities for the entire society. Except in clause 3(1), there is nothing to suggest that the activities shall be for Pareek Samaj only. Charitable activities carried out by the trust: The complete description of the charitable activities carried out by the trust is appearing in the reply submitted before the ld. CIT at PB 11: We provide service of hospitality to pilgrims coming to Pushkar in our ashram including food at free of cost. We also provide ashram for marriage of poor girls at free of cost. However any other miscellaneous facility require for marriage are taken from outsiders and expenses of the same reimbursed by booking families like generator expenses, decoration and other related services. We also provide food without stay and without any charges to poor and needy people. We also held medical camp at our ashram for poor an....
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....ha gyan shiksha kosh" Request letter from students are attached Akhil Bharatvarshiya Pareek Ashram Pushkar 3 students Charitable 1,15,650/- 5 Separate study room facility free of cost to students coming from out of station in the exam days In every exam dated Akhil Bharatvarshiya Pareek Ashram Pushkar 125 students Charitable 17,550/- 6 Medicines for Cow in the pandemic of Lumpy disease September 2022 to march 2023 Akhil Bharatvarshiya Pareek Ashram Pushkar 122 cows Charitable 15,300/- 7 Donation to other trust for charitable purpose 16/07/2022 14/10/2022 Akhil Bharatvarshiya Pareek Ashram Pushkar 3 other trusts Charitable 11,000/- 11,000/- 8 Donation for "samuhik vivah" 27/05/2022 23/02/2024 Akhil Bharatvarshiya Pareek Ashram Pushkar 30 couples Charitable 11,000/- 11,000/- It is clear the assessee trust carried out activities for the entire society as well as needy and helpless and not just for Pareek Samaj and the observation of the Id. CIT is incorrect and unjustified. Bills, Images and evidences of the activities also submitted: The assessee has submitted bills an....
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....rpretation made by the Id. CIT holding the trust for specific community as incorrect. Please refer to the decision in case of Porwal Yuvak Sangh, Kota vs. CIT Exemption ITA No.708/JPR/2024 dt.20-12-2024, a copy of which is enclosed herewith. Without prejudice to above Section 13(1)(b) cannot be made basis at the time of registration: In the instant case, the ld. CIT quoted provisions of section 13(1)(b) for coming to the conclusion that assessee is not eligible for registration as charitable trust. Though the object of the assessee were not for any specific community as has been discussed above still without prejudice to the same it is submitted that the provisions of section 13(1)(b) will come into picture only when determining issue of allowing exemption u/s 11 r/w 12 of the Act and not at the time of registration. Even the decision of Hon'ble Supreme Court in Dawoodi Bohara which is quoted by the ld. CIT is also in respect of exemption to the assessee and not in respect of registration. The decision itself talks of circumstances in which the decision was delivered. The relevant extract is being reproduced herein below: COMMISSIONER OF INCO....
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.... the findings recorded by the Tribunal, supported by decision of this Court in case of CIT vs. Bhaya Kutchhi Dasa Oswal Jain Mahajan Trust (2017) 8 IRT-OL 493 (Guj) that the objects of the trust are not wholly for the benefit of a particular religious community, but are largely charitable in character for general public at large and for the purpose of granting registration under s. 12A of the Act, the provision of s. 13(1)(b) cannot be referred to. Sec. 13(1)(b) is to be applied while granting exemption to the trust. In view of above finding, we do not 4 / 5 find any question of law much less any substantial question of law arises for consideration. 8. The appeal is accordingly dismissed. The fact of the case of the assessee are identical and therefore, the findings of the above decisions are squarely applicable in the present case also and accordingly the provisions of section 13(1)(b) cannot be referred. Reason for non-reply to the show cause notice: Though the issue is self- explanatory as the 'objects as a whole' do not lead to conclusion that the activities of the trust are for Pareek samaj only however still it is accepted that the reply cou....
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....312; सम्पति वापस न्यास के उद्द्योषक अथवा ट्रस्टियों को नहीं दी जायेगी। Thus it is clear that on dissolution of the trust the assets will not go back to the founders or trustees of the trust. However the Id. CIT has observed as follows on page 5 of the order: "The purpose of having dissolution clause in the constitution of a charitable institution is to ensure that even if the trust/institution is wound up, the assets/income of the trust/institution will not be used for any other purposes except for the purposes of the trust and the same can also be transferred to other similar charitable institution provided that the objects are similar in nature. While in instant case clause says that in event of dissolution, properties will go to founder trustee or other trustees and they are free to use the same as per their will. Thus in case of assesse....
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....ficiary activities related to non- Pareek and Pareek Samaj List of activities performed by trust in response submitted dt.05.05.2024 PB 12 PB 13 PB 149-153 PB 156-159 6 As per I/E account, ashram/bhawan running on rent, not furnish any details of such expense. No rental income as already submitted before Ld. CIT (exemption) PB 11 point no.2 7 Not furnish details of rental income from Pareek Bhawan No rental income as already submitted before Ld. CIT (exemption) PB 11 point no.2 8 Not furnish details of 13(3) persons No payment made to such persons PB 11 point no. 5 The ld. CIT observed submission of bills and vouchers in order u/s 80G: It is notable that the ld. CIT himself has observed in the order passed in form no. 10AD rejecting application u/s 80G of the Act. "3.1 On perusal of the details of charitable activities and bills/ vouchers, the trust society as organised -------- " (page 3 of Id. CIT -form 10AD) Thus the ld. CIT has himself observed submissions of bills and vouchers by the assessee and therefore, subsequent allegation of not submitting bills/ vouchers is contrary to the facts on record ....
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....opies of demand notice and payment slip of Office of Nagar Palika, Pushkar (Ajmer) 142-143 17. Copies of documents of free services of food and stay facilities for the students and their parents 144-159 18. Copies of Form 10B along with Financials Statements for the FY 2020-21 160-168 19. Copy of Financial statements for the FY 2022-23 169-171 Case laws relied upon: * CIT(Exemption) vs. Jamiatul Banaat Tankaria in Tax Appeal No. 968 of 2024 dated 9^th Oct, 2024, (2024) 8 NYPCTR 1456 (Guj.) 6. The ld. AR of the assessee in addition to the above written submission so filed vehemently argued that so far as the reasons for discrepancies in dissolution clause, the assessee could not explain the same as the assessee could not reply to the last show cause notice in full. But in fact as per clause 17 of the trust deed already on record the observations of the ld. CIT(E) and the clause which is available on record is contrary and needs to be explained before the ld. CIT(E). Therefore, in the interest of justice he submitted that the assessee be given a chance to cure that observation. As regards the other two observations, ld. AR of the ass....
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.... was discrepancy in dissolution clause. On the basis of the details available on record it is noted that the assessee much before changed that clause but could not so demonstrate before the ld. CIT(E), and the assessee has placed on record the modified trust deed. Based on this aspect of the matter, we feel that the observation so made is curable in nature and since the assessee admitted that in the last letter it could not file the complete details and that, the assessee be given a chance to rectify that observation. As regards the other two observations of ld. CIT(E) that the assessee works for the benefit of particular community and that its activities are not genuine, we find force that the assessee trust is working as a charitable trust since 1963 and has been assessed as such taking the benefit of sections 11 and 12 of the Act and therefore, the observations of the ld. CIT(E) that assessee works for a particular community and activities were not genuine come to be made as the assessee could not supply complete details in response to the letter issued on 29.06.2024. Based on the details placed on record in the paper book, we are of the considered view that the said observation....