INDIAN SOCIAL SERVICE,WARANGAL V. ITO, EXEMPTION WARD-1(4), HYDERABAD

ITA 1316/HYD/2024

AI Insights

The case involves the Indian Social Service, an NGO based in Warangal, which appealed against the decision of the Commissioner of Income Tax (Exemption), Hyderabad. The Commissioner had rejected the NGO's application for registration under section 80G of the Income Tax Act, 1961, claiming that the NGO was not engaged in substantial charitable activities as required under section 12AB of the Act. The Tribunal examined the financial records and annual reports of the NGO, which demonstrated significant charitable activities and expenditures. The Tribunal concluded that the Commissioner had not provided specific details on which activities were non-charitable, thus allowing the appeal and directing a re-evaluation of the application.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 46455 (ITAT-HYDERABAD)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-03-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB-B
• Assessment Year: 2024-2025
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: M. NARMADA
• Assessee Lawyers: S.RAMA RAO
• Keywords: Set aside
• Section: 12; 80G

Judgement Text

"आयकर अपीलीय अधिकरण, हैदराबाद पीठ में IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES “B”, HYDERABAD BEFORE SHRI K.NARASIMHA CHARY, JUDICIAL MEMBER & SHRI MADHUSUDAN SAWDIA, ACCOUNTANT MEMBER आ.अपी.सं / ITA No.1316/Hyd/2024 (निर्धारण वर्ा / Assessment Year: -NA-) Indian Social Service Warangal [PAN :AAATI4793E] Vs. Income Tax Officer (Exemption) Ward-1(4) Hyderabad अपीलधर्थी / Appellant प्रत्‍ यर्थी / Respondent निर्धाररती द्वधरध/Assessee by: Shri S.Rama Rao, AR रधजस्‍ व द्वधरध/Revenue by: Ms.M.Narmada, CIT-DR सुिवधई की तधरीख/Date of hearing: 27/02/2025 घोर्णध की तधरीख/Pronouncement on: 18/03/2025 आदेश / ORDER PER K. NARASIMHA CHARY, J.M: Aggrieved by the order dated 09/12/2024 passed by the learned Commissioner of Income Tax (Exemption), Hyderabad [learned CIT(E)], in the case of Indian Social Service (“the assessee”) assessee preferred this appeal. 2. At the outset, learned AR submitted that the learned CIT (E) rejected the application of the assessee in form No. 10AB seeking registration under section 80G of the Income Tax Act, 1961 (for short “the Act”) stating that no substantial activities which are charitable in nature are being carried out by the assessee, which is in violation of the provisions of the sec. 12 AB of the Act, without specifying any details thereof. The learned AR brought to our notice 2 the independent audit report, statement of income and expenditure, receipts and payments along with the Balance Sheet and schedules for the years ended with 31/3/2022, 31/3/2023 and 31/3/2024 along with the annual report of the NGO for the years 2021-22, 2022-23, and 2023-24, evidencing the activities of the assessee. Without pointing out which activity of the assessee does not fall in the category of charitable activities, the learned CIT(A) is not justified in rejecting the application for registration in section 80G of the Act. 3. Learned DR placing heavy reliance on the impugned order and submitted that the learned CIT(E) took a plausible view on a perusal of the submissions made by the assessee that the assessee did not do any considerable activity of charitable in nature. 4. We have gone through the record in the light of the submissions made on either side. It is an undisputed fact that by order dated 24/09/2021, registration under section 12AB of the Act was granted under section 12A(1)(ac)(i) of the Act, subject to the condition that if it is subsequently found that the activities of the assessee are not genuine or if they are not carried out in accordance with all or any of the conditions subject to which such the registration was granted, there is no compliance of the assessee while meeting any of the conditions mentioned in this registration, the order is liable to be withdrawn by the prescribed authority. 5. The income and expenditure account of the assessee for the years ended with 31/3/2022, 31/3/2023 and 31/3/2024 clearly show that the assessee incurred substantial expenditure as against the grant receivable and the annual reports for the years 2021-22, 2022-23 and 2023-24 establish that the assessee did considerable activities during the year and when these things are viewed in the light of the activities mentioned in the annual reports like health checkup program, and other programs like awareness and woman trafficking include human rights, awareness program by Barossa, Swadhar Greh. Many of the activities are connected to the Ministry of Women and Child Development, Government of India. Ld. CIT (E) did not specify any activity that does not fall in the category of charitable activity. 3 6. In the circumstances, we are of the considered opinion that it is a fit case to set aside the impugned order and restore the issue to the file of the learned CIT(E) with a direction to reconsider the issue in the light of the material and grant registration under section 80G of the Act. Grounds are answered accordingly. 7. In the result, appeal of the assessee is allowed. Order pronounced in the open court on this the 18th day of March, 2025. Sd/- Sd/- (MADHUSUDAN SAWDIA) (K. NARASIMHA CHARY) ACCOUNTANT MEMBER JUDICIAL MEMBER Hyderabad, Dated: 18/03/2025 L.Rama, SPS Copy forwarded to: 1. M/s Indian Social Service, H.No.11-16-77, Kashibugga, Warangal 2. The Income Tax Officer, Exemption Ward-1(4), Hyderabad 3. The Pr.CIT (Exemptions), Hyderabad 4. The DR, ITAT, Hyderabad 5. GUARD File TRUE COPY SENIOR PRIVATE SECRETARY ITAT, HYDERABAD "