2024 (1) TMI 876 - AT - Income Tax

Deduction u/s 80G - rejection of registration to the assessee-trust u/sec. 12AB for want of supporting evidences - HELD THAT - The purpose of the provisions for registration of trust u/sec. 12AB and granting of exemption u/sec. 80G, all these sections derives their spirit from the Directive Principles of State Policy enshrined in the Constitution of India. Since, the Govt. of India makes endeavor to provide welfare to one and all in the society at large and in view thereof the registration for public charitable trusts are given in order to ensure that through these charitable trusts benefits should flow to the entire society wherefrom various charitable activities, the entire society is benefited and the objectives of the Govt. of India in furtherance to the Directive Principles of State Policy are achieved. These provisions for the trust registration u/sec. 12A and granting of exemption u/sec. 80G enhance the socio economic welfare in the society. Furthermore, the Income Tax laws are welfare legislations and not penal in nature. Thus, we are of the considered view that one final opportunity should be provided to the assessee to file the relevant details before the ld. CIT(E) and present their case on merits. Appeal of the assessee is allowed for statistical purpose.

Summary

Issues involved:
The rejection of registration to the assessee-trust u/sec. 12AB of the Act by the ld. CIT(E).

Summary:
The appeal arose from the rejection of registration of a trust by the Commissioner of Income Tax (Exemption), Pune. The assessee's sole grievance was the denial of registration under section 12AB of the Act. Despite the absence of the assessee during the hearing, the case was considered based on the submissions of the ld. DR and available materials. The ld. CIT(E) had called for details from the assessee to verify the genuineness of the trust's objects and charitable activities. As the assessee failed to provide clarifications, the registration application was rejected. The Tribunal noted that the purpose of trust registration and exemption provisions is to promote socio-economic welfare as per the Directive Principles of State Policy. Emphasizing the non-penal nature of Income Tax laws, the Tribunal decided to provide the assessee with a final opportunity to submit relevant details and present their case before the ld. CIT(E) for a fresh adjudication, ensuring compliance with natural justice principles. The appeal was allowed for statistical purposes.

Separate Judgment:
No separate judgment was delivered by the judges.