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2024 (7) TMI 348 - AT - Income TaxRejection of registration of assessee trust u/s 12A - assessee is not registered under the Rajasthan Public Trust Act, 1959 - HELD THAT - Assessee submitted that the assessee trust is duly registered with Sub Registrar, Jaipur under the Rajasthan Public Trust Act, 1959 vide Registration Endorsement issued by the Sub Registrar of Trust under the State Government of Rajasthan Jaipur. Thus, in the interest of justice assessee submitted that the assessee be given a chance to defend this merit before the ld. CIT(E) and this mistake of the fact is curable in nature we considered the prayer of the assessee for registration of the trust u/s. 12AB of the Act and the 80G recognition application was rejected only on the ground that the assessee is not eligible for approval under clause (ii) of first proviso to sub-section (5) of section 80G of the Act since it was not already approved under clause (i) or (iii) of first proviso to sub-section(5) of section 80G. We also deem it fit to set aside the order of the ld. CIT(E) for recognition of the trust u/s. 80G of the Act and ld. CIT(E) should decide both the application a fresh. Appeal allowed for statistical purposes.
Issues Involved:
1. Rejection of application for registration of assessee trust under section 12A of the Income Tax Act, 1961. 2. Rejection of application for approval under section 80G of the Income Tax Act, 1961. Issue 1: Rejection of application for registration of assessee trust under section 12A of the Income Tax Act, 1961: The assessee filed an online application seeking registration under section 12AB. The Commissioner of Income Tax (Exemptions) issued notices and reminders requesting documents/explanations. The assessee sought adjournments multiple times, responding through DAK and email. The case was decided based on the available material as it was a time-sensitive matter. The appeal challenged the rejection of registration based on the ground that the trust was not registered under the Rajasthan Public Trust Act, 1959. The appellant argued that the trust was duly registered with the Sub Registrar, Jaipur. The Tribunal noted the mistake in fact and considered it curable. The Tribunal allowed the appeal, directing a fresh decision by the CIT(E) regarding the registration of the trust under section 12AB. Issue 2: Rejection of application for approval under section 80G of the Income Tax Act, 1961: The application for approval under section 80G was rejected as the trust was not approved under section 12AB. The applicant was asked to justify its claim for approval under the relevant section, but the applicant did not comply. The appeal contended that the rejection was based on the trust not being eligible for approval under a specific clause. The appellant argued that the trust was duly registered under the Rajasthan Public Trust Act, 1959. The Tribunal found that the rejection was solely due to the lack of approval under section 12AB and set aside the order. The Tribunal directed the CIT(E) to reconsider both the applications for registration under section 12AB and approval under section 80G. In conclusion, the Tribunal allowed both appeals, setting aside the orders of the CIT(E) and directing a fresh decision on the registration of the trust under section 12AB and the approval under section 80G. The Tribunal emphasized the need for a proper evaluation based on the facts presented by the appellant.
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