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2019 (2) TMI 712 - AT - Income TaxApplication for approval u/s 80G(5)(vi) rejected - registration u/s 12AA - Held that - We are of the view that Order under section 80G(5) denying approval to the assessee cannot be sustained in Law. It is not in dispute that assessee has been granted registration under section 12AA of the I.T. Act, 1961, by DIT (E) vide Order Dated 29.09.2018. CIT(E) was satisfied with the objects and activities of the assessee that it is meant for charitable purposes, therefore, different view cannot be taken while refusing the grant of approval under section 80G(5). CIT(E) did not doubt the objects of the assessee and did not mention anything if assessee has violated any of the conditions of Section 80G(5). Considering we are of the view that assessee is entitled for approval under section 80G(5) of the I.T. Act, 1961, from the date of application. We, accordingly, set aside the impugned Order and direct the Ld. CIT(E), Chandigarh, to grant approval to the assessee under section 80G(5)(vi) of the Income Tax Act, 1961, from the date of application. - Decided in favour of assessee.
Issues:
1. Rejection of application for approval under section 80G(5)(vi) of the Income Tax Act, 1961 by Ld. CIT(E), New Delhi. 2. Dispute over charitable activities conducted by the assessee-Trust. 3. Comparison with similar cases leading to different outcomes. Issue 1: Rejection of application for approval under section 80G(5)(vi) of the Income Tax Act, 1961 by Ld. CIT(E), New Delhi: The appeal was directed against the order of the Ld. CIT(E), New Delhi, rejecting the application for approval under section 80G(5)(vi) of the Income Tax Act, 1961. The Ld. CIT(E) found that the assessee failed to provide sufficient proof that it was actually carrying out charitable activities in line with the Trust Deed. Despite being in existence since 2012, the Trust had not undertaken significant charitable activities except for a single donation. The lack of substantial charitable work led the Ld. CIT(E) to deem the application premature and reject it. Issue 2: Dispute over charitable activities conducted by the assessee-Trust: The assessee argued that it was established to carry out charitable activities as per its Trust Deed. It highlighted a donation made to "Kanya Gurukul Mahavidyalaya" and the use of premises for charitable activities. The assessee claimed that due to the absence of approval under section 80G, it couldn't receive donations to further its charitable objectives. The assessee pointed out that it had received registration under section 12AA, indicating the genuineness of its activities, and contended that it met the conditions of Section 80G(5) of the Income Tax Act, 1961. The Tribunal referred to a similar case where approval was granted under Section 80G(5) and ruled in favor of the assessee. Issue 3: Comparison with similar cases leading to different outcomes: In a separate case, the Ld. CIT(E) in Chandigarh rejected approval under section 80G(5)(vi) despite granting registration under section 12A. The Tribunal noted that the applicant had carried out charitable activities like providing free services to hospitals. The Tribunal referred to legal precedents where registration under section 12A was deemed sufficient for charitable purposes, leading to the grant of approval under section 80G. The Tribunal overturned the decision, emphasizing that if the activities were genuine and charitable, approval under section 80G should be granted. In both cases, the Tribunal ruled in favor of the assessee, directing the concerned authorities to grant approval under Section 80G(5) of the Income Tax Act, 1961. The decisions were based on the genuineness of the charitable activities and compliance with the relevant legal provisions, highlighting the importance of fulfilling conditions for approval under the Income Tax Act.
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