2025 (10) TMI 934

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....ly advocating for, coordinating and assisting trading organizations, can be said to be involved in advancement of objects of GPU. 03. CIT(E), Chennai stated that the Appellant is a mutuality concern in his final conclusion. The appellant prays ITAT to pass order on merits in mutuality applicability to the Appellant. 3. The brief facts of the case are that the assessee filed an application for registration of trust u/s. 12AB of the Act on 19.08.2024 in Form No.10AB under Rule 17A of the Income Tax Rules, 1962. In response to the application filed by the assessee under Form 10AB for registration u/s. 12A of the Act, the Ld.CIT(E), Chennai, required the assessee to furnish certain details to which the assessee filed on 11.02.2025. Upon examining the Object Clause as per the Bye Laws and other details submitted documents, the Ld.CIT(E) observed that the objects of the assessee appeared to be limited to serving the interest of the members of The Jewellers and Diamond Trade Association-Madras. 4. The Ld.CIT(E) concluded that the assessee's activities and objects are primarily to protect, preserve, safeguard and further the interest and welfare of merchants dealing in diamo....

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....ause (iii) or sub-clause (v) of section 12A(1)(ac) and the Principal Commissioner or Commissioner has not satisfied, he can reject the application as well as cancel the registration of the trust/institution. Considering all the above facts, the application field under the section 12A(1)(ac) (iii) in Form 10AB is not maintainable and as such deserved rejection. 4.10 Under the facts and circumstances of the case, the application field by the applicant on 19.08.2024 in Form 10AB u/s 12A(1)(ac) (iii) seeking registration u/s 12AB of the Act is rejected for the reasons enumerated in para 4.1 to 4.9 of this order" 5. Aggrieved, the assessee is in appeal before us against the order of the Ld.CIT(E) rejecting the application filed by the assessee. The Ld.AR for the assessee primarily contended that looking into the objects of the assessee, the assessee qualifies as a 'Trade Association' by placing reliance on the judgment of the Hon'ble Supreme Court in the case of Ahmedabad Urban Development Authority and thus is covered under the category of "advancement of any other object of general public utility" as defined u/s. 2(15) of the Act. The Ld. AR also filed a written s....

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....uded in the expression 'charitable purpose' if it advances an object of general public utility. The expression 'object of general public utility', however, is not restricted to objects beneficial to the whole of mankind. An object beneficial to a section of the public is an object of general public utility. To serve a charitable purpose, it is not necessary that the object should be to benefit the whole or mankind or even all persons living in a particular country or province. It is sufficient if the intention to benefit a section of the public as distinguished from specified individuals." 8. In the case of Assistant Commissioner of Income-tax (Exemptions) vs. Ahmedabad Urban Development Authority [2022] 449 ITR 1 (SC), the Hon'ble Supreme Court held as under: "203. The revenue has appealed to this court, in respect of two assessment years, in the case of Apparel Export Promotion Council (AEPC). The objects of AEPC, which was set up in 1978 - include promotion of readymade garment export. To achieve that end, its objects include providing training to instil skills in the workforce, to improve skills in the industry; guide in sourcing machinery; to serve ....

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....lfare Society [2012] 24 taxmann.com 93/138 ITD 519 (Lucknow), the ITAT held that since provisions of Sections 11, 12 and 13 are intended for exercise of jurisdiction by an AO in an assessment proceeding, Commissioner is not competent to invoke such provisions for purpose of declining registration u/s. 12AA of the Act. 10. In view of the above judicial precedents, we proceed to decide the issue before us. The present matter relates to the denial of registration u/s. 12AB of the Act, by Ld.CIT(E). The primary question to be determined is whether, at the stage of registration, the Ld.CIT(E) is empowered to go into the issue of taxability of income or whether his role is limited to examining the genuineness of the activities of the trust and the nature of its objects. At the stage of registration of the trust, the Ld.CIT(E) is required only to verify whether the trust or institution has charitable objects and whether its activities are genuine. The question of whether particular receipts are taxable or whether certain provisions of Sections 11, 12, or 13 of the Act are attracted is a matter that falls squarely within the domain of the AO during the course of regular assessment proce....