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TMI Blog2024 (6) TMI 727X X X X Extracts X X X X X X X X Extracts X X X X ..... s the matter is restored to the file of CIT (E), for de novo consideration, after giving due opportunity of being heard and with the direction not to disentitle the assessee for grant of registration only on the grounds as mentioned in its order for rejecting the application filed by the assessee trust Appeal of the assessee is allowed for statistical purposes. - SMT. ANNAPURNA GUPTA, ACCOUNTANT MEMBER SHRI SIDDHARTHA NAUTIYAL, JUDICIAL MEMBER For the Appellant : Shri Darshak Thakkar, A.R. For the Respondent : Shri Kamlesh Makwana, CIT D.R. ORDER PER SIDDHARTHA NAUTIYAL, JM: Both the appeals have been filed by the Assessee against the orders passed by the Ld. Commissioner of Income Tax (Exemption), (in short Ld. CIT(E) ), Ahmedabad vide separate orders dated 28.08.2023 28.06.2023 passed for A.Y. 2023-24 rejecting the application for registration under Section 80G(5)(iii) of the Act vide order dated 28.08.2023 and rejecting application for registration of Trust under Section 12A of the Act vide order dated 28.06.2023. 2. The assessee has raised the following grounds of appeal: ITA No. 667/Ahd/2023 (A.Y. 2023-24) 1. That the learned Commissioner of Income Tax (Exemptions), Ahmedaba ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n by the Hon ble Apex Court in the above referred case, the provisions of Section 13(1)(b) would be applicable and therefore, the applicant / assessee would not be eligible for exemption under Section 11 of the Act. Therefore, looking into the instant facts, the applicant / assessee cannot be granted registration under Section 12A of the Act. 4. The assessee / applicant is in appeal before us against the aforesaid order passed by Ld. CIT(E) rejecting the application for grant of the registration under Section 12AB of the Act. 5. Before us, the Counsel for the assessee argued / submitted that the case of the assessee is squarely covered by the case of CIT, Rajkot-II vs. Leuva Patel Seva Samaj Trust 42 taxmann.com 181 (Gujarat), wherein the Gujarat High Court has held that question as to whether trust is created or established for benefit of any particular religious community or caste would be relevant only when income of trust is being assessed in terms of Section 11, however, at time of disposing of application of a trust seeking registration, Commissioner has to merely decide whether said trust has fulfilled necessary requirements of registration as provided under Section 12A of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Insofar as section 12AA of the Act is concerned, the Commissioner had to take a decision if the trust fulfilled necessary requirements of registration as provided under section 12A of the Act. A Division Bench of this Court in the case of Shantagauri Ramniklal Trust v. CIT [1999] 239 ITR 528, in this context, observed as under : While considering an application for registration of a trust, the Commissioner must also make a clear distinction between the requirement of registration and the requirement for claiming tax benefit. The latter question falls squarely to be considered by the Assessing Officer. Section 12A neither makes registration of trust as condition precedent for claiming benefit under sections 11 and 12 read with section 13, nor registration obviates enquiry into the conditions envisaged under section 13 by the Assessing Officer before the tax benefit can be allowed. Mere filing of application for registration of the trust is enough to claim benefit of its income under sections 11 and 12 and jurisdiction to the Assessing Officer to enquire into that claim, which also includes question as to who are the beneficiaries of trust. On other conditions being fulfilled, the ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the needy and poor for religious activities would not divest the trust of its altruist character. 41. Therefore, the objects of the trust exhibit the dual tenor of religious and charitable purposes and activities. Section 11 of the Act shelters such trust with composite objects to claim exemption from tax as a religious and charitable trust subject to provisions of Section 13. The activities of the trust under such objects would therefore be entitled to exemption accordingly. 42. We would now proceed to examine the objects under the provisions of Section 13(1)(b) of the Act. It becomes amply clear from the language employed in the provisions that Section 13 is in the nature of an exemption from applicability of Sections 11 or 12 and the examination of its applicability would only arise at the stage of claim under Sections 11 or 12. Thus, where the income of a trust is eligible for exemption under Section 11, the eligibility for claiming exemption ought to be tested on the touchstone of the provisions of Section 13. In the instant case, it being established that the respondent-trust is a public charitable and religious trust eligible for claiming exemption under Section 11, it beco ..... X X X X Extracts X X X X X X X X Extracts X X X X
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