CENTRES FOR EXCELLENCE FOR AGRICULTURE SKILLS IN INDIA, GURGAON,GURGAON V. CIT (EXEMPTIONS), CHANDIGARH, CHANDIGARH

ITA 4860/DEL/2024

AI Insights

The case revolves around the Centre for Excellence for Agriculture Skills in India, a public charitable trust, which sought permanent registration under section 12AB of the Income Tax Act. The CIT (Exemptions) initially rejected this application, categorizing the trust's activities under 'advancement of general public utility', which is restricted under the proviso to section 2(15) of the Act. The Tribunal, however, disagreed with this interpretation, emphasizing that the trust's primary activities of education and relief to the poor align with the first and second limbs of charitable purposes as defined in section 2(15).

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 34770 (ITAT-DELHI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-03-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2022-2023
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SURENDER PAL
• Assessee Lawyers: RAKESH GUPTA
• Keywords: Charitable institution

Judgement Text

"Page | 1 INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “B”: NEW DELHI BEFORE SHRI M. BALAGANESH, ACCOUNTANT MEMBER AND MS MADHUMITA ROY, JUDICIAL MEMBER ITA No. 4860/Del/2024 (Assessment Year: 2022-23) Centre for Excellence for Agriculture Skills in India, Unit No. 101, First Floor, Greenwoods Plaza, Block-B, Greenwoods City, Sector-45, Gurgaon Vs. CIT(Exemptions), Chandigarh (Appellant) (Respondent) PAN: AAEAC6244M Assessee by : Dr. Rakesh Gupta, Adv Shri Ranjan Chopra, CA Shri Deepesh Garg, Adv Revenue by: Shri Surender Pal, CIT DR Date of Hearing 17/02/2025 Date of pronouncement 27/03/2025 O R D E R PER M. BALAGANESH, A. M.: 1. The appeal in ITA No.4860/Del/2024 for AY 2022-23, arises out of the order of the Commissioner of Income Tax (Exemptions), Chandigarh [hereinafter referred to as ‘ld. CIT(E)’, in short] in Appeal No. ITBA/EXM/F/EXM45/2024-25/1067833675(1) dated 21.08.2024. 2. Though the assessee has raised several grounds of appeal before us, the only effective issue to be decided in this appeal is as to whether the learner CIT(Exemptions) was justified in rejecting the application seeking for registration under section 12AB of the Act in the facts and circumstances of the instant case. ITA No. 4860/Del/2024 Centre for Excellence for Agriculture Skills in India Page | 2 3. We have heard the rival submissions and perused the materials available on record. It is not in dispute that assessee is a public charitable trust. The predominant objects of the assessee trust is imparting education and relief of the poor, which fall in first and second limb of the definition of charitable purpose as per section 2(15) of the Act. The assessee trust was duly granted provisional registration under section 12AB of the Act. The assessee made an application in Form No. 10AB seeking permanent registration of the trust. This application was sought to be rejected by the learned CIT(Exemptions) on the ground that assessee’s activity, though charitable in nature, falls under the ambit of advancement of general public utility (namely the seventh limb of the definition of charitable purpose as per section 2(15) of the Act). The learned CIT (exemptions) observed that assessee has violated the proviso to section 2(15) of the Act and accordingly not eligible for seeking permanent registration under section 12AB of the Act. 4. The assessee trust during the course of proceedings before the Learned CIT (exemptions) furnished details of charitable activities carried out by it together with the details of receipts and payments thereon. These details are tabulated in page 5 of the order of the Learned CIT(Exemptions). Further, the assessee also furnished the income and expenditure account for financial years 20-21, 21-22 and 22-23, which are tabulated in page 6 of the order of the Learned CIT(Exemptions). On perusal of the said table, it is found that predominant activity carried out by the assessee is towards imparting education and relief of the poor. Hence, it is abundantly clear that assessee is primarily engaged in the first and second limb of charitable purpose as defined in section 2(15) of the Act. Hence, the activities carried out by the assessee cannot be construed to be falling within the ambit of advancement of general public utility so as to make the proviso to section 2(15) of the Act applicable. Hence, we have no hesitation to hold that the Learned CIT(Exemptions) grossly erred in treating the activities of the assessee trust to fall within the ITA No. 4860/Del/2024 Centre for Excellence for Agriculture Skills in India Page | 3 ambit of advancement of general public utility and denying the registration thereon. In any event, we find that even if the proviso to section 2(15) of the Act is to be made applicable in the instant case, the same need to be looked into at the time of assessment proceedings and that does not hamper the grant of permanent registration under section 12AB of the Act. Obviously the applicability of proviso to section 2(15) of the Act (which is not applicable in the instant case) and its alleged violation thereon cannot be a reason for rejecting the permanent registration. Hence we have no hesitation in directing the Learned CIT (Exemptions) to grant permanent registration to the assessee by treating the assessee’s activities to be genuine and charitable in nature and falling within the first and second limb of definition of charitable purpose under section 2(15) of the Act. Accordingly, the grounds raised by the assessee are hereby allowed. 5. In the result, the appeal of the assessee is hereby allowed. Order pronounced in the open court on 27/03/2025. -Sd/- -Sd/- (MADHUMITA ROY) (M. BALAGANESH) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated: 27/03/2025 A K Keot Copy forwarded to 1. Applicant 2. Respondent 3. CIT 4. CIT (A) 5. DR:ITAT ASSISTANT REGISTRAR ITAT, New Delhi "