AGARWAL SABHA,GUWAHATI V. CIT (EXEMPTION), KOLKATA

ITA 2593/KOL/2024

AI Insights

The case involves Agarwal Sabha Radha Kishan Dindayal, a trust focused on the welfare of the Agarwal community, which sought recognition under section 80G of the Income Tax Act. The CIT (E) initially denied this recognition, citing that the trust's objectives were restricted to a specific caste, which is not permissible under the Act. The trust appealed this decision, arguing that their activities during the COVID-19 pandemic, such as food distribution and relief camps, demonstrated a broader public benefit. However, the Tribunal found that the trust's primary objectives still centered on the Agarwal community, thus not meeting the criteria for 80G recognition.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 653120 (ITAT-KOLKATA)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-06-2025
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: misc
• Laws Referred To: Section 80G of the Income Tax Act
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: KAPIL MANDAL
• Assessee Lawyers: ASHOK KUMAR AGARWALA
• Section: 80G

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL “B” BENCH, KOLKATA BEFORE SHRI GEORGE MATHAN, JM AND SHRI RAKESH MISHRA, AM ITA No. 2593/KOL/2024 (Assessment Year: 2025-26) Agarwal Sabha Radha Kishan Dindayal, SRCB Road Fancy Bazar, Assam- 781001 Vs. CIT (Exemption) 10B, Middleton Road, Kolkata-700071, West Bengal (Appellant) (Respondent) PAN No. AALAA5893M Assessee by : Shri Ashok Kumar Agarwala, AR Revenue by : Shri Shri Kapil Mandal, DR Date of hearing: 17.06.2025 Date of pronouncement : 18.06.2025 O R D E R PER GEORGE MATHAN, JM: This is an appeal preferred by the assessee against the order of the ld. Commissioner of Income-tax (Exemption) (hereinafter referred to as the “Ld. CIT(E)”] dated 22.11.2024 against the rejection of the assessee’s claim for recognition u/s 80G of the Act. 02. Shri Ashok Kumar Agarwala appeared on behalf of the assessee and Shri Kapil Mandal, Sr. DR appeared on behalf of the revenue. 03. It was the submission by the ld. AR that the assessee society was functioning from the year 2008. It was the submission that the assessee had filed an application on 1st May, 2024 for approval u/s 80G(5)(iii) of the Act. The assessee had not provided the details as called for by the ld. CIT (E) originally and the tribunal had restored the issues to the file of the ld. CIT (E). Consequent to the order of the Tribunal, the ld. CIT Page | 2 ITA No. 2593/KOL/2024 Agarwal Sabha; A.Y. 2015-26 (E) had called for certain details. After considering the submissions of the assessee the ld. CIT (E) had denied the assessee the approval u/s 80G(5) of the Act on the ground that the assessee trusts object is restricted to specific caste i.e. Agarwal cate and to promote the welfare activities to the members of the said caste. The ld. CIT (E) applied the provisions of explanation 2 to section 80G (5) of the Act, which specify that the trust or institution does not qualify for an approval u/s 80G if it is established for the benefit of a particular religion, community or caste. It was the submission of the ld. AR that adequate opportunity has not been granted to the assessee. It was also the submission that another application has also been filed before the ld. CIT(E). 04. In reply, the ld. CIT DR relied upon the findings of the ld. CIT (E). 05. We have considered the rival submissions. A perusal of the paper book filed by the assessee shows that the objective of the Trust are as follows: - “The objectives of the trust are as follows: 1. To provide all-round development of Agrawal young men and women at the social, economic, political, physical, intellectual and moral level, so that they can be properly helpful in the development and progress of the country and can make the Agrawal society proud. 2. To make efforts to form branches of Agrawal Sabha to build a strong Agrawal society. 3. To carry out public service and development programs for the benefit of the common people without caste and religious discrimination and to construct buildings, hospitals etc. 4. To organize matrimonial introduction conference and mass marriage for Agrawal community. 5. To make efforts to create effective public opinion against the social evils and bad practices prevalent in Agarwal society. 6. To propagate the glorious part of literature and culture related to Maharaja Agrasen and to carry out new creative activities. 7. To construct hostels as per requirement for the students of Agarwal community and to run them smoothly. Page | 3 ITA No. 2593/KOL/2024 Agarwal Sabha; A.Y. 2015-26 8. To formulate and implement schemes to inspire and encourage Agrawal young men and women for higher education in various fields. 9. To make efforts to provide financial and other necessary assistance to the deserving but resourceless students of Agarwal community. 10. To encourage the creative power of the talents of Agarwal community in the fields of art, science, literature, journalism, law, commerce, technology etc. and to reward and honor them in conventions and other function of Agrawal community. 11. To give due respect to the social workers of Agarwal Community. 12. Appropriate guidance to awaken clean cultural consciousness among the Agarwal Community. 13. To try to solve the problem of unemployment prevalent in Agrawal Community. 14. To make the community member aware of their social responsibility in the personality development of Agarwal society. 15. To establish mutual cooperation and unity with the local people, especially celebrating the birth anniversaries of local great personality and local festivals etc. and taking active part in them. 16. To make efforts to protect the identity of the Agarwal Community. 17. To organize various programs to establish in the society to rejuvenate the memories of the social leaders of the Agarwal Community. 18. To organize various events and efforts while remaining alert and active in the interest of national unity. 19. To provide relief to the common people in natural disasters and to serve the common people by organizing health camps, relief camps etc. 20. To exchange cooperation with organizations having similar objectives. 21. To make arrangements for creation of socially useful literature, its publication and distribution etc. 22. To organize various programs from time to time to serve the general public. 23. To do all other works which are in the interest of the country and humanity. 24. To collect and accept financial assistance under various schemes from the society and general public to fulfill the main and auxiliary objectives and to buy and sell movable and immovable property as per requirement 25. To encourage children and youth of Agarwal Community for sports and other competitions.” 06. A perusal of the said objects clearly show that the objects are for the benefit of the specific caste i.e. Agarwal caste and to promote the Page | 4 ITA No. 2593/KOL/2024 Agarwal Sabha; A.Y. 2015-26 welfare activities to the members of the said caste. In the reply to the ld. CIT (E), it is mentioned that during the covid, the assessee has done extensive food distribution and blood donation camps. They have organized flood relief camp at Boko during 2020 for all communities affected. They have honored covid warriors during Covid. They have distributed food material, etc. as is mentioned in the reply which read as follows: - “1) During covid we have done extensive Food Distribution and Blood Donation Camp for all communities. (Rs 104980/-appears in I/E A/c as on 31.03.2020) 2) We have organised flood Relief Camp at Boko during 2020 for all the communities effected (out of donation received in kind) 3) We have honoured Covid worriors during Covid. 4) We have distributed food material at B. Barooah Cancer Hospital for community at large (out of donation received in kind) 5) We have installed water filter at local hospital (out of donation received in kind) 6) We have donated one sewing machine to Local Assamese people (out of donation received in kind).\" 07. A perusal of the form 10AB shows that the corpus of the trust amounting to ₹5,20,100/-, their liabilities shown at ₹5,96,450/-. Their investments has shown ₹5,95,043/- and during F.Y. 2020, they have received specific grants which have not corporate or from Central or State Government of ₹3,29,100/- plus Other income totaling to ₹3,47,548/-, for F.Y. 2021, totaling to ₹2,84,850/- and for F.Y. 2022, totaling to ₹4,38,144/-. This is as shown in their application in form no. 10AB which read as follows: - Intentionally left blank Page | 5 ITA No. 2593/KOL/2024 Agarwal Sabha; A.Y. 2015-26 08. When this is compared to the utilization which is claimed in 2020 they have utilized ₹1,04,980/-. The water filter at the local hospital is out of donation received in kind and the swing machine donated is out of donation received in kind. Thus, their activities cannot be deemed to be for public at large, especially when their object are clearly for the benefit of the Agarwal caste. This being so. We find no error on the order of ld. Page | 6 ITA No. 2593/KOL/2024 Agarwal Sabha; A.Y. 2015-26 CIT (E), denying the assessee the benefit of the approval u/s 80G of the Act. 09. In the result, the appeal of the assessee is dismissed. Order pronounced in the open court on 18.06.2025. Sd/- Sd/- (RAKESH MISHRA) (GEORGE MATHAN) (ACCOUNTANT MEMBER) (JUDICIAL MEMBER) Kolkata, Dated: 18.06.2025 Sudip Sarkar, Sr.PS Copy of the Order forwarded to: 1. The Appellant 2. The Respondent 3. CIT 4. DR, ITAT, 5. Guard file. BY ORDER, True Copy// Sr. Private Secretary/ Asst. Registrar Income Tax Appellate Tribunal, Kolkata "