TaxTMI 
TaxTMI 
TaxTMI 
2025 (10) TMI 929
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.... bad in law and on facts of the case and hence the same may kindly be quashed. 3. The appellant prays your honour to add, amend or alter any of the grounds of the appeal on or before the date of hearing." ITA NO. 1021/JPR/2024 : "1. The impugned order dated 28.06.2024 of the Act is bad in law and on facts of the case for want of jurisdiction and various other reasons and hence, the same kindly be quashed. 2. The ld. CIT (Exemption) erred in law as well as on the facts of the case in rejecting the application for granting the approval u/s 80G. The rejection so made and exemption so denied u/s 80G is totally contrary to the provisions of law and on facts of the case and hence the same may kindly be quashed. 3. The appellant prays your honour to add, amend or alter any of the grounds of the appeal on or before the date of hearing." Both these appeals are inter-related and inter-connected, therefore, first of all, we deal with the grounds of the assessee raised in ITA No.1015/JP/2024. 2. The brief facts of the case are that the assessee society had filed an online application under section 12AA dated 12.01.2019 in Form No.10A seeking registr....
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....n submitted before us which are reproduced as under : "Brief Facts: The appellant is a charitable society, established long back and engaged in promoting nationality, education, personality development of the students without any discrimination of caste, creed and sex (Refer amended trust deed at PB5-32). The facts, of the 1st round, as noted by the ld. CIT(E).is that the appellant filed an online application u/s 12AA dt. 12.01.2019 in Form No.10A for seeking registration u/s 12AA of the Act along with application u/s 80G dt 12.01.2019. In response, the CIT(E) issued notice dt. 01.04.2019 requesting to submit certain documents/ explanations and also to produce original RC/MOA for verification. In compliance thereto, Shri G.P. Singhal, CA/AR attended and furnished details on various dates. The CIT(E) vide its notice dt. 01/02.07.2019 asked the assessee-society to produce the certified copy of the MOA for verification, however upon non- furnishing of the same, the CIT(E) rejected the application for registration u/s 12AA vide its order dated 31.07.2019, the relevant extract is under : "05. As discussed above, the appellant did not submit original documents ....
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.... Thereafter, in compliance of the directions of the Hon'ble ITAT, the ld. CIT(E) (in this 2nd round) issued Notice dt. 16.03.2022(PB 68-71), in response to which the assessee filed a detailed replies dt. 21.03.2022& 10.06.2024 (PB 72-74& 79-82 respectively).Unfortunately, however, the CIT(E) without consider the same, again rejected the application for registration u/s 12AAvide impugned order on dt. 27.06.2024, on various new grounds (which were not raised during the 1st round) i.e (a) Non-genuineness of activities and (b) Non-registration of Rajasthan Public Trust Act. Similarly, the application for exemption u/s 80G was also rejected vide order dated 28.06.2024 on various grounds i.e (a) Approval u/s 80G cannot be granted without registration u/s 12AA (b) Religious object violated u/s 80G(5)(ii) (c) meant for particular community (d) Religious Exp. are more than 5% Hence this appeal. Submission: GOA 1 : Impugned Order dt. 27.06.2024 is bad-in law : 1. The Passing of the impugned order is barred by the limitation u/s 153(3). In this connection, your kind attention is drawn that the order of Hon'ble ITAT, Jaipur Bench, Jaipur in 1....
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....period of three months from the end of the month in which order under section 250 or section 254 or section 260 or section 262 is received by the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner, as the case may be, the order under section 263 or section 264 is passed by the 48[Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner, as the case may be]" 1.2 In the facts of the present case, the Hon'ble ITAT after considering all the facts and circumstances of the matter, passed an order dated 03.09.2020 (PB 47-62), restoring the issue to the ld. CIT(E) for afresh examination on the limited issue i.e. applicability of Rule 17A, for requirement to furnish the original copy of the documents, rather than self-attested/ self-certified copy, which was decided in the favour of the assessee, only and simply with a view to ensure that the applicant assessee in compliance of Rule 17A has filed Self attested/ self-certified copy on record. The Hon'ble ITAT never meant to touch upon issues which were never part of them. Further considering the legal provisions laid down by S. 153(3) of the Act, the order....
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....3. The short issue is with regard to the deemed registration of an application under Section 12AA of the Income Tax Act. The High Court has taken the view that once an application is made under the said provision and in case the same is not responded to within six months, it would be taken that the application is registered under the provision. Para 5. We see no basis for such an apprehension since that is the only logical sense in which the Judgment could be understood. Therefore, in order to disabuse any apprehension, we make it clear that the registration of the application under Section 12AA of the Income Tax Act in the case of the respondent shall take effect from 24.08.2003." 2.2 Also the Hon'ble Rajasthan High court in the case of CIT(E) Vs Gettwell Health and Education Samiti, Sikar (Raj.) [2020] 115 taxmann.com 66 (Rajasthan)(DC 47-50) is directly applicable which is also a case based on almost similar facts. In that case also, the Hon'ble Tribunal remanded the matter back to the ld. CIT(E) on dt. 22.07.2011. The CIT(E), however passed fresh order only on dt. 09.10.2015 rejecting the application on certain grounds. In that context it was held as under, ....
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.... months from the end of months in which application was received, where the Commissioner disposed of application with delay of around three years, the Tribunal was justified in granting registration with effect from the date of application." II. Limited Scope under Remand Orders 3.1 That the sole reasons behind rejection of application of registration by the ld. CIT (E) in the first round was that no certified copy of MOA was produced by the assessee for verification (the relevant extract of the said order is reproduced above at Pg 1 of this W/s). Aggrieved by this order appellant preferred appeal before the Hon'ble ITAT, Jaipur, wherein the Hon'ble ITAT vide order dt. 03.09.2020, rejected the findings of the CIT(E) and set-aside the said order over specific issue for granting registration u/s 12AA and exemption u/s 80G. The relevant extract of the order (PB 47-62) is reproduced hereunder: - "In view of the above discussions, we are of the considered view that as per amended rule 17A of the Income Tax Rules, which are applicable in the case of the assessee, the assessee was not required to furnish the original copy of the documents rather self attested or....
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.... light of judgment of Supreme Court in Engineering Analysis case (supra) which dealt with taxability of receipt as 'royalty' under section 9(1)(vi), impugned addition was to be deleted on technical grounds - Held, yes [Paras 9- 14] [In favour of assessee]" 3.2.2 Reference is also placed on the decision of the Andhra Pradesh High Court in Pulipati Subbarao and Co. v. Appellate Assistant Commissioner [1959] 35 ITR 673(DC 43-44), wherein it was held that "Pursuant to the order passed by the Appellate Assistant Commissioner it is open to the Income-tax Officer to consider the one and the only question referred to him, viz., whether the firm's application for registration should be allowed. There is no other question before the Income-tax Officer and he would certainly be transgressing the limits set down by law if he were to embark upon a fresh enquiry as to the quantum of the income or the loss incurred by the petitioner." 3.3.3 Also, in the case of Murlidhar Bhagwandas vs. Commissioner of Income-tax [2000] 111 Taxman 619 (Bombay)(DC 37-42), it was held that "Section 143, read with section 251, of the Income-tax Act, 1961 - Assessment - On remand - Assess....
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....) - (PB36-43). 5.2. All other conditions already fulfilled[in first round]: Pertinently, the ld. CIT(E) raised voluminous queries vide letter dt. 01.04.2019 (PB 33-35) raising as many as 26 queries/ issues and all of them were duly replied time to time, filing explanation and the required details were submitted by vide various letters dt. 25.05.19 (PB36-43), 10.06.19 (PB44) and 15.07.19 (PB45- 46). There apart, the appellant also submitted a statement of activity carried out during the relevant F.Y. 2018-19 in accordance with the object which are undoubtedly charitable in nature. The audited financial statements of accounts signed by independent Statutory Auditor are also available on record (PB 38-43) as admitted by the Ld. CIT(E). Further, the objects are admittedly charitable in nature as per S. 2(15) of the Act. 5.3 The ld. CIT(E) could not raise any other adverse issues and felt satisfied on all other aspects i.e. the genuineness of the activities and objects of the institution being in accordance with law but the only basis of the rejection remained non-filing of the initial document establishing the institution, in original, which was a mis-conception on hi....
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....ade under sub-clause (i) of the said clause, pass an order in writing registering the trust or institution for a period of five years; (b) Where the application is made under sub-clause (ii) or sub-clause (iii) or subclause (iv) or sub-clause (v) [or item (B) of sub-clause (vi)] of the said clause, - (i) Call for such documents or information from the trust or institution or make such inquiries as he thinks necessary in order to satisfy him about- (A) The genuineness of activities of the trust or institution; and (B) the compliance of such requirements of any other law for the time being in force by the trust or institution as are material for the purpose of achieving its objects; (ii) after satisfying himself about the objects of the trust or institution and the genuineness of its activities under item (A) and compliance of the requirements under item (B), of sub-clause (i), - (A) Pass an order in writing registering the trust or institution for a period of five years; or (B) If he is not so satisfied, pass an order in writing, - (I) in a case referred to in sub-clause (ii) or sub-clause (iii) or sub-clause (v....
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....e Ld. CIT (E), Jaipur is duty bound to establish that how the compliance with RPT Act, 1959 is material for the purpose of achieving its objects. In our opinion, both the statutes, i.e. The Income Tax Act, 1961 and RPT Act, 1959. All the authorities relied upon by the assessee (Sic- CIT(E)) are w.r.t. educational institutions, where context is different, i.e. students at large and issues like capitation fee, allocation of seats, pay scale of teachers and curriculum of the syllabus etc. are in focus. For public benefit and reasonability, such regulations are there, specifically the states where big institutions are indulged in imparting education in the field of Medical, Engineering and Managements etc. 6.The next judicial pronouncement relied upon by the Ld. CIT (E), Jaipur is from the court of Hon'ble Apex Court as under: [2022] 143 taxmann.com 276 (SC) New Noble Educational Society vs. CCIT, relevant paras are reproduced as under: "It is held that wherever registration of trust or charities is obligatory under state or local laws, the concerned trust, society, other institution etc. seeking approval under section 10(23C) should also comply with provisions of suc....
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....e. Accordingly, it is submitted that the rejection of the assessee's registration application solely on the ground of non-registration under the Rajasthan Public Trust Act, 1959 is untenable and deserves to be set aside. 7. Other Objections of CIT(E) - in 2nd Round: 7.1 Sec.12AA(1) requires the ld. CIT(E) to grant or to refuse registration on the examination/satisfaction of certain conditions. The law is by now well settled that while granting registration the only requirement is that the ld. CIT(E) has to satisfy himself about the objects of the trust and genuineness of the activities and nothing more than that. The law has made specific requirements, the scope of which cannot be expanded. This is evident from various case laws given in different situations where the department rejected such applications on the grounds other than those prescribed but rejection was held unjustified. Therefore, when the ld. CIT(E) has not doubted the aims and objects of the society in an objective manner, he couldn't have rejected the application merely on this pretext. 7.2 Ld. CIT(E) allegation over non-submission of documents / information: The ld. CIT(E) has alleged tha....
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.... of the assessee, nowhere in the MOA/deed, the assessee has not mentioned that the activities conducted by the Assessee-Trust are leaning in favour of a particular community or religion. 10. Religious expenses are more than 5% thus violation of section 80G(5B): The Ld. CIT(E) in its order has mentioned that the Assessee Trust is engaged in religious activities and that the expenses done towards religious activities are more than 5%. The facts so mentioned by the ld. CIT(E) are baseless and without any supporting documents as the assessee is a religious-cum-charitable trust. The Assessee Trust's motto itself is the non-prayer of any deity, god, roots and are against "Murti Poojan". The same is mentioned in its Trust Deed (PB 5-32). Along with that, the assessee has provided certified copies of financial statements along with its expenses and statement of activities. The total expenses done by the trust on all the activities, which are claimed to be religious by the Ld. CIT(E), are vey less than 5% of the total expenditure. Therefore, the claims made by the Ld. CIT(E) that the Assessee trust is benefiting a particular religious Community are baseless and bad in taste and wit....
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....rust reported in (2014) 90 CCH 0209 (Raj HC) 1-3 2. Modern DefenceShishkanSansthan Vs. CIT (2007) 108 TTJ (Jd) 732 4-5 3. CIT v/s Shyam Mandir Committee (2018) 400 ITR 466 (Raj) 6-26 4. CIT v. D.N Memorial Trust[2023] 152 taxmann.com 33 (J&K) 27-29 5. Edunxt Global SDN - BHD v. DCIT [2024] 169 taxmann.com 113 (Bangalore - Trib.) 30-36 6. Murlidhar Bhagwandas v. CIT [2000] 111 Taxman 619 (Bombay) 37-42 7. Pulipati Subbarao v. ACIT [1959] 35 ITR 673 (Andhra Pradesh) 43-44 8. CIT, Kanpur v. Society for Promn. of Edn.,Allahabad [2016] 67 taxmann.com 264 (SC) 45-46 9. CIT(E) v. Gettwell Health and Education Samiti, Sikar[2020] 115 taxmann.com 66 (Rajasthan) 47-50 10. CIT v. Sahitya Sadawart Samiti Jaipur [2017] 88 taxmann.com 703 (Rajasthan) 51-53 11. APJ Abdul Kalam Education and Welfare Trustvs. CITn (E) ITA No. 567/JPR/2024 54-67 8. The ld. AR of the assessee in addition to the written submission so filed vehemently argued that the reasons advanced for rejection are curable in nature and the assessee was not given sufficient opportunity of being heard before the ld. CIT(E) and considering ....