GST AND TAXATION BAR,JALANDHAR V. INCOME TAX OFFICER, WARD-1(1), JALANDHAR

ITA 502/ASR/2024

AI Insights

The case involves the GST and Taxation Bar, which appealed against the rejection of their application for registration under section 12A(1)(ac)(iii) of the Income Tax Act by the Commissioner of Income Tax (Exemptions), Chandigarh. The primary contention was whether the association's activities, which focus on professional education and member interaction, qualify as charitable purposes under the law. The Tribunal examined the association's Articles of Association, financial statements, and the nature of its activities, concluding that the association does serve a public charitable purpose despite its primary beneficiaries being its members.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 398006 (ITAT-AMRITSAR)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-06-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2023-2024
• Laws Referred To: Section 12A(1)(ac)(iii), Sec.2(15)
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VEDANSHU TRIPATHI LD
• Assessee Lawyers: PARIKSHIT AGGARWAL LD
• Keywords: Charitable institution

Judgement Text

"1 IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH, AMRITSAR BEFORE SHRI MANOJ KUMAR AGGARWAL, AM AND HON’BLE SHRI UDAYAN DAS GUPTA, JM आयकरअपील सं. / ITA No. 502/ASR/2024 GST and Taxation Bar 498-LA, Model Town Gita Mandir, Jalandhar.144001 बनाम/ Vs. Income Tax Officer, Ward No.1(1), Jalandhar ̾थायीलेखासं./जीआइआरसं./PAN/GIR No. AADAG-0859-P (अपीलाथŎ/Appellant) : (ŮȑथŎ / Respondent) अपीलाथŎकीओरसे/ Appellant by : Shri Parikshit Aggarwal (CA) – Ld. AR ŮȑथŎकीओरसे/Respondent by : Dr. Vedanshu Tripathi (CIT) – Ld. DR सुनवाईकीतारीख/Date of Hearing : 25-03-2025 घोषणाकीतारीख /Date of Pronouncement : 06-06-2025 आदेश / O R D E R Manoj Kumar Aggarwal (Accountant Member) 1. Aggrieved by rejection of an application seeking registration u/s 12A(1)(ac)(iii) vide impugned order dated 14-08-2024 as passed by learned Commissioner of Income Tax (Exemptions), Chandigarh [CIT(E)], the assessee is in further appeal before us. 2. The Ld. AR, Shri Parkshit Aggarwal, advanced arguments and drew attention to the Articles of Association to contradict the observation of Ld. CIT(E) in the impugned order. The Ld. CIT-DR also advanced arguments supporting rejection of application. Having heard rival submissions and upon perusal of case records, our adjudication would be as under. 2 3. The objects of assessee-association have been enumerated in para-4 of the impugned order. One of the primary objects is to promote interaction amongst members of the BAR by organizing meeting, seminars, talks, discussion & lectures etc. for dissemination of professional knowledge and education and to provide a forum and promote professional education for the benefit of public from time to time. As noted in para-4.1 of the impugned order, the assessee has incurred expenditure on conducting seminars and meetings for its members which are in consonance with the objects of the association. 4. The Ld. CIT(E), upon perusal of Sec.2(15), held that law recognizes no purpose as charitable purposes unless it is of public character. A purpose must be beneficial to the public at large and not for the benefit of private individuals. When the primary purpose of the society was to extend benefit to its members themselves, the society could not be held to be established for charitable purposes even if it was formed for the study of a particular science and that study leads to promotion of the education generally. From the nature of expenditure, it was not discernible as to how the expenditure was incurred for the purpose of general public utility. Since the activities of the society were restricted to its own members, it was not a public charitable trust. Secondly, the assessee did not have utilization clause, investment clause, beneficiary clause and dissolution clause. The absence of these important clauses makes a society revocable not enuring to the benefit of general public and open to any possibility of society property being utilized for the benefit of the members of the society. In this 3 background, the registration was denied. Aggrieved, the assessee is in further appeal before us. 5. We find that the assessee-association is in existence since the year 2017. It is holding provisional registration for AYs 2023-24 to 2025-26. The copies of financial statements for FYs 2019-20 to 2021- 22 have also been placed on record. Upon perusal of the same, it could be seen that the assessee has incurred expenditure mainly to conduct seminar and meeting expenses. The assessee is duly registered with the Registrar of Societies. In the impugned order, there is no allegation that the assessee has spent any money for purposes other than for its objects. The copy of Memorandum of Association and Articles of Association has also been placed on record. As per Articles of Association, the assessee could have different categories of members and the assessee admit members from wide spectrum of people. On these facts, the assessee, in our considered opinion, is entitled for said registration. Needless to add that it is always open for the revenue to examine the utilization of funds at the time of assessment proceedings. Therefore, the appropriate authority is directed to grant the said registration to the assessee. We order so. 6. The appeal stand allowed in terms of our above order. Order pronounced u/r 34(4) of Income Tax (Appellate Tribunal) Rules, 1963. Sd/- Sd/- (UDAYAN DAS GUPTA) (MANOJ KUMAR AGGARWAL) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated: 06 -06-2025 4 आदेश की Ůितिलिप अŤेिषत / Copy of the Order forwarded to : 1. अपीलाथŎ/Appellant 2. ŮȑथŎ/Respondent 3. आयकरआयुƅ/CIT 4. िवभागीयŮितिनिध/DR 5. गाडŊफाईल/GF ASSISTANT REGISTRAR ITAT AMRITSAR "