BAJAJ AUTO CHARITABLE TRUST,DELHI V. COMMISSIONER OF INCOME TAX (EXEMPTION), DELHI, DELHI

ITA 724/DEL/2025

AI Insights

The case involves Bajaj Auto Charitable Trust appealing against the decision of the Commissioner of Income Tax (Exemption), which had rejected the Trust's application for registration under section 12A(1)(ac)(iii) of the Income Tax Act for the assessment year 2024-25. The Commissioner had rejected the application on grounds that the Trust did not carry out any activities in the financial years 2022-23 and 2023-24, and also questioned the rationale behind the Trust applying for two provisional registrations. The Tribunal found that the Commissioner had placed undue emphasis on the lack of activities in the recent financial years, which was not a valid ground for denying registration, especially in light of the Trust's charitable activities and the Supreme Court's decision in Ananda Social & Educational Trust Vs. CIT.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 842388 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-02-2026
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2024-2025
• Appeal Filed On: 07-02-2025
• Other Referred Cases: Ananda Social & Educational Trust Vs.CIT (2020) 114 taxmann.com 693 (SC)
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MUKESH KUMAR JHA
• Assessee Lawyers: VASANTI PATEL
• Keywords: Set aside; Competent authority; Charitable institution
• Section: 12AA; 12A; 80G

Judgement Text

"P a g e | 1 ITA No.724/Del/2025 Bajaj Auto Charitable Trust (AY: 2024-25) IN THE INCOME TAX APPELLATE TRIBUNAL “C” BENCH, DELHI BEFORE SHRI ANUBHAV SHARMA, JUDICIAL MEMBER & SHRI AMITABH SHUKLA, ACCOUNTANT MEMBER ITA No.724/Del/2025 (Assessment Year:2024-25) Bajaj Auto Charitable Trust, B-60, Naraina Industrial Estate, Mitraon, South West Delhi, Delhi – 110028 Vs. Commissioner of Income Tax (Exemption) Civic Centre, Minto Road, New Delhi - 110002 \u0001थायीलेखासं./जीआइआरसं./PAN/GIR No: AADTB0371L Appellant .. Respondent Appellant by : Ms.Vasanti Patel, Adv. Respondent by : Sh. Mukesh Kumar Jha, CIT, DR Date of Hearing 18.12.2025 Date of Pronouncement 26.02.2026 O R D E R PER ANUBHAV SHARMA, JM: This appeal is preferred by the assessee against the order dated 18.12.2024 of the Ld. CIT(Exemption), Delhi (hereinafter referred as ‘Ld. Competent Authority’) rejecting the application for registration u/s 12A(1)(ac)(iii) of the Act for AY:2024-25. Printed from counselvise.com P a g e | 2 ITA No.724/Del/2025 Bajaj Auto Charitable Trust (AY: 2024-25) 2. Heard and perused the record. The appellant trust is established on 22.02.2017 and had obtained provisional registration from CPC on 27.05.2021 valid for the period from AY: 2021-22 to AY: 2023-24 u/s 12A(1)(ac)(iii) of the Act. Subsequently, it obtained another provisional registration on 04.10.2021 for the period from 2023-24 to AY: 2025-26. Thereafter, the present application in the Form 10AB seeking regular registration u/s 12A(1)(ac)(iii) of the Act was filed on 28.06.2024 upon which the competent authority issued questionnaire calling details and after considering the submissions of the assessee the competent authority observed that assessee has credited NIL income in FY: 2023-24 & FY: 2022-23. Further competent authority observed that in this financial year except for auditors remuneration of Rs.11,800/- in each year, there was no expenses debited to the income and expenditure accountand thus, concluded that applicant has not carried out any activity. Response of assessee was sought to explain the same for which assessee replied as follows: “...... BACT has been set up by its settlor Bajai Auto Limited exclusively for undertaking CSR activities of itself and for its affiliate companies. During the F.Y 2023-24, Bajaj Auto Limited had incurred expenditure aggregating to Rs. 132 crores towards CSR activities.” 3. Ld. Competent authority concluded as follows ; Printed from counselvise.com P a g e | 3 ITA No.724/Del/2025 Bajaj Auto Charitable Trust (AY: 2024-25) The applicant in its reply has stated that Bajaj Auto Limited has incurred expenditure aggregating to 132 towards CSR activities. However, the applicant has not provided any specific details regarding the activities undertaken by it during the Financial Years 2022- 23 and 2023-24. The applicant, Bajaj Auto Charitable Trust, and Bajaj Auto Limited distinct and separate legal entities. The activities and expenditures of Bajaj Auto Limited cannot be considered the charitable activities undertaken by Bajaj Auto Charitable Trust. 4. On perusal of reply it is noticed that the applicant has two orders of provisional registration. The applicant was asked to explain the same. In response to the same, the applicant has stated as under:- “The order for provisional registration enclosed as Annexure 3B of our submission filed on 1 August 2024 was valid from A. Y 2021-22 to A. Y 2023- 24. The order for provisional registration enclosed as Annexure 3C of our submission filed on 1 August 2024 is valid from A. Y 2023-24 to A. Y 2025-26. The said Annexures are enclosed again herewith for ready reference.” The applicant has failed furnish the reasons for applying for two provisional registration. 5. In view of the above, it is evident that the applicant has not carried out any activity during the F.Y 2023-24 and F.Y 2022-23. Thus, it does not qualify for registration u/s 12AB of the I.T Act. Hence, the application filed in Form 10AB on 28.06.2024for grant of registration u/s 12A(1)(ac)(iii) of the Income Tax Act, is hereby rejected. 6. Since, the application filed in Form 10AB seeking registration under sub-clause (iii) of clause (ac) of sub-section (1) of section 12A of the Act is rejected, the provisional registration granted provisional registration from CPC on 27.05.2021with Unique Registration number AADTB0371LE20206, valid for the period from A.Y 2021-22 to A.Y 2023-24 and provisional registration from CPC on 04.10.2021 with Unique Registration number AADTB0371LE20221, valid for the period from A.Y 2023-24 to A.Y 2025-26., is also cancelled.” 4. The assessee is in appeal raising following grounds: “Non-granting of registration under section 12AB: 1. On the facts and in the circumstances of the case and in law, the Commissioner of Income-tax (Exemption) erred in rejecting the application filed by the Appellant in Form 10AB for grant of registration under section 12A(1)(ac)(iii). 2. On the facts and in the circumstances of the case and in law, the Commissioner of Income-tax (Exemption) erred in holding that the Appellant does not qualify for Printed from counselvise.com P a g e | 4 ITA No.724/Del/2025 Bajaj Auto Charitable Trust (AY: 2024-25) registration under section 12AB on the ground that it had not carried out any activity in FY 2023-24 and FY 2022-23. 3. On the facts and in the circumstances of the case and in law, the Commissioner of Income-tax (Exemption) erred in not appreciating the fact that the Appellant had not done any act in contravention of, or violated any of the provisions of section 12A. 4. On the facts and in the circumstances of the case and in law, the Commissioner of Income-tax (Exemption) erred in not appreciating the fact that the Appellant had, through its submission dated 22 November 2024 as well as during the course of personal hearing on11 December 2024, filed the details of contributions received and donations given during the period from FY 2018-19 to FY 2021-22, and that the Appellant is expected to play a vital role in the near future for carrying out CSR activities for its settlor, viz. Bajaj Auto Limited. 5. On the facts and in the circumstances of the case and in law, the Commissioner of Income-tax (Exemption) erred in observing that the Appellant has failed to furnish the reasons for applying for two provisional registrations, without appreciating the fact that the Appellant was holding registration under section 12AA read with section 12A from 27 November 2017 and had re-applied for a regular registration under section 12A owing to the amendments made in the Income-tax Act 1961. Revocation of past provisional registrations granted: 6. On the facts and in the circumstances of the case and in law, the Commissioner of Income-tax (Exemption) erred in cancelling the provisional registrations granted to the Appellant on27 May 2021 and on 4 October 2022, when none of the conditions for such cancellation provided in section 12AB have been proved or even alleged by the Commissioner of Income-tax (Exemption). The appellant hereby reserves the right to add, to alter or amplify the above grounds of appeal.” 5. We have heard both sides and primarily we find that contention of assessee is that at this stage only genuineness of the activities has to be seen and on the basis of allegation and giving findings that there were no activities undertaken by the trust, registration cannot be declined or cancelled. Reliance Printed from counselvise.com P a g e | 5 ITA No.724/Del/2025 Bajaj Auto Charitable Trust (AY: 2024-25) was placed on the decision of Hon’ble Supreme Court in the case of Ananda Social & Educational Trust Vs.CIT (2020) 114 taxmann.com 693 (SC). 5.1 On the contrary, the ld. DR has submitted that there is no error in the impugned order. 6. After going through the impugned order we find as with regard to the objects and activities of the trust on the basis of trust deed there was no adverse inference or observation of the competent authority that the same are not charitable in nature. We have gone through the same and find that the charitable activities of the trust are for the purpose of relief to poor, education, preservation of environment and preservation of human monument or place of artistic and historic which are general in nature. At the time of application certified copies of audited annual accounts for FY: 2022-23, 2021-22 & 2020-21 and ITRs for each year were enclosed, copies of bank statements and details of donations were also provided. 7. We find that at page 52 there is a receipt dated 10.02.2022 which shows that assessee had donated Rs.3,65,000/- to one NGO donations to which were exempted u/s 80G of the Act. Similar donation of Rs.15,00,000/- was made to the same NGO on 22.12.2022 and Rs.15,00,000/-on 23.01.2020 and Printed from counselvise.com P a g e | 6 ITA No.724/Del/2025 Bajaj Auto Charitable Trust (AY: 2024-25) Rs.16,00,000/- and a donation was made to another NGO located at Pune.There are details of donations received copy of which is at page 50 and same mentions in 2018-19 assessee had received Rs.25,00,000/- from Bajaj Auto Limited and in 2019-20 assessee had received Rs.25,00,000/- from Bajaj Auto Ltd. and in Financial Year 2021-22 assessee received Rs.3,65,000/- towards non corpus donations. These details were also filed with the competent authority and copy of which is at page 50. Very apparently none of the donations received or use of donations have been doubted. Thus, the conclusion of competent authority that assessee has not carried out any activity during financial year 2023-24 and 2022-23 is not of much consequence at this stage of grant of registration where the scope of inquiry is limited to find genuineness of Trust activity in a manner to examine that there is no intention to generate surpluses as profits. 8. Further, we find that the assessee has been incorporated by Bajaj Auto Limited for carrying out corporate responsibility activities initially for itself and if so requested by the affiliates then also for or on their behalf. Printed from counselvise.com P a g e | 7 ITA No.724/Del/2025 Bajaj Auto Charitable Trust (AY: 2024-25) 9. Hon’ble Supreme Court in Ananda Social & Educational Trust (supra) has held that even though there were no activities and applicant is entitled for registration u/s 12AA, relevant part of the same is reproduced below: 10. It was argued before us that the Commissioner is required to be satisfied about two things - firstly that the objects of the trust and secondly, its activities are genuine. If there have been no activities undertaken by the trust then the Commissioner cannot assess whether such activities are genuine and therefore, the Commissioner is bound to refuse the registration of such a trust. 11. We have given our anxious consideration to the above submissions made by Ms. Aishwarya Bhati, learned Senior Counsel appearing for the appellant - Director of Income-tax and find that it is not possible to agree with the same. The purpose of section 12AA of the Act is to enable registration only of such trust or institution whose objects and activities are genuine. In other words, the Commissioner is bound to satisfy himself that the object of the Trust are genuine and that its activities are in furtherance of the objects of the Trust, that is equally genuine. 12. Since section 12AA pertains to the registration of the Trust and not to assess of what a trust has actually done, we are of the view that the term 'activities' in the provision includes 'proposed activities'. That is to say, a Commissioner is bound to consider whether the objects of the Trust are genuinely charitable in nature and whether the activities which the Trust proposed to carry on are genuine in the sense that they are in line with the objects of the Trust. In contrast, the position would be different where the Commissioner proposes to cancel the registration of a Trust under sub-section (3) of section 12AA of the Act. There the Commissioner would be bound to record the finding that an activity or activities actually carried on by the Trust are not genuine being not in accordance with the objects of the Trust. Similarly, the situation would be different where the trust has before applying for registration found to have undertaken activities contrary to the objects of the Trust.” 10. All these aspects have been left out of consideration by the competent authority to and laid more emphasis on lack of activities, which at this stage are not much relevant and cannot be basis for denial of the registration. In the Printed from counselvise.com P a g e | 8 ITA No.724/Del/2025 Bajaj Auto Charitable Trust (AY: 2024-25) light of aforesaid circumstances we are of the considered view that it is an appropriate case that the assessee should be granted registration. 11. Accordingly, grounds are allowed. The appeal of assessee is sustained and the impugned order is set aside and directions are issued to the competent authority to allow the Form 10AB of the applicant. Order pronounced in the open court on 26.02.2026 Sd/- (Amitabh Shukla) Sd/- (Anubhav Sharma) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated 26.02.2026 Rohit, Sr. PS Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI Printed from counselvise.com "