2023 (2) TMI 1368 - HC - Income Tax

Cancellation of registration granted u/s 12AA - trust has not carried out charitable activity - ITAT granted registration - HELD THAT - The correctness of the order was tested before the learned Tribunal which had taken note of the various decisions of the Hon ble Supreme Court and, in our view, rightly held that while granting registration to the charitable institution or trust, if it is at the commencement stage, the powers of DIT with whom the application is filed by such trust/institution are limited to the aspect of examining whether or not the objects of the trust are charitable nature. Revenue does not dispute the fact that the objects of the trust are religious and charitable in nature. If such be the factual position, the learned Tribunal rightly allowed the appeal filed by the respondent. No ground to interfere with the order passed by the Tribunal.

Summary

The High Court dismissed the revenue's appeal under Section 260A of the Income Tax Act, 1961. The appeal challenged the order of the Income Tax Appellate Tribunal regarding the registration of a trust under Section 12AA and exemption under section 80G(5)(vi). The Tribunal correctly held that registration should be based on charitable nature of trust's objects. The appeal was dismissed, and the substantial question of law was answered against the revenue.