MANDAN PARIVAR CHARITABLE TRUST,VADODARA V. CIT (EXEMPTION), AHMEDABAD

ITA 2027/AHD/2024

AI Insights

Mandan Parivar Charitable Trust appealed against the decision of the Commissioner of Income Tax (Exemption), which denied them registration under section 80G of the Income Tax Act. The Commissioner had concluded that 31.5% of the trust's expenses were on religious activities, which exceeded the permissible limit of 5% for charitable purposes. The trust argued that their expenses on cultural preservation and promotion were misclassified as religious expenses. The Tribunal decided to remand the case for a detailed verification of the trust's expenses to ensure a fair assessment in accordance with the law.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 23291 (ITAT-AHMEDABAD)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-02-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: misc
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Opportunity of being heard; Charitable institution

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD “D” BENCH BEFORE: DR. BRR KUMAR, VICE PRESIDENT And SHRI SIDDHARTHA NAUTIYAL, JUDICIAL MEMBER Mandan Parivar Charitable Trust, 127, Aadinath Society, VIP Road, Karelibaug, Vadodara-390019. PAN: AAITM6892L (Appellant) Vs The Commissioner of Income Tax (Exemption) Ahmedabad. (Respondent) Assessee Represented: Shri Malhar Shah, AR. Revenue Represented: Shri Prathvi Raj Meena, CIT.D.R. Date of hearing : 18.02.2025 Date of pronouncement : 19.02.2025 आदेश/ORDER PER : DR. BRR KUMAR, VICE PRESIDENT: This appeal is filed by the Assessee as against the appellate order dated 25.09.2024 passed by the Commissioner of Income Tax (Exemption), Ahmedabad, relating to the Assessment Year N.A. 2. The assessee has raised the following grounds of appeal: ITA No.2027/Ahd/2024 Assessment Year N.A I.T.A No. 2027/Ahd/2024 A.Y. NA Page No 2 (1) Promotion of Culture and Heritage Does not Equate to Religious Purpose. (2) Guidance by a Jain Monk Does not imply Religious classification. (3) Trust’s activities focus on cultural preservation, humanitarian support, and social welfare, not solely religious purpose. (4) Donation to Akhil Bhartiya Shwetamber Murtipujak Tapagachha Jain Mahasangh is for charitable not religious purpose. (5) Opportunity of being heard is not provided for clarifying nature of expenses. (6) Opportunity of being is not provided for the reasons mentioned for rejection of application. 3. At the outset the Ld.AR for the assessee submitted the Ld. CIT(E) came to the conclusion that assessee has spent 31.5 % of the total expenses on account of religious activities and hence declined to grant registration u/s.80G of the Act. The Ld.AR argued that the Ld. CIT(E) erred in considering the amounts spent on preservation of cultural monuments and cultural promotion expenses as religious expenses . The Ld.AR argued that the expenses on account of religious activities should not exceed 5% of the total receipts for charitable purposes. Since the mater pertains to verification of the actual expenses, in the interest of justice, we remand the matter to the file of Ld.CIT(E) to verify the expenses and take a decision in accordance with the I.T.A No. 2027/Ahd/2024 A.Y. NA Page No 3 provisions of Income tax Act, pertaining to the grant of registration u/s.80G(5)(B) of the Act. 4. In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open court on 19.02.2025. Sd/- Sd/- (SIDDHARTHA NAUTIYAL) (DR.BRR KUMAR) JUDICIAL MEMBER VICE PRESIDENT (True Copy) Ahmedabad : Dated 19.02.2025 आदेश कᳱ ᮧितिलिप अᮕेिषत / Copy of Order Forwarded to:- 1. Assessee 2. Revenue 3. Concerned CIT 4. CIT (A) 5. DR, ITAT, Ahmedabad 6. Guard file. By order/आदेश से, उप/सहायक पंजीकार आयकर अपीलीय अिधकरण, अहमदाबाद IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD “D” BENCH BEFORE: DR. BRR KUMAR, VICE PRESIDENT And SHRI SIDDHARTHA NAUTIYAL, JUDICIAL MEMBER Mandan Parivar Charitable Trust, 127, Aadinath Society, VIP Road, Karelibaug, Vadodara-390019. PAN: AAITM6892L (Appellant) Vs The Commissioner of Income Tax (Exemption) Ahmedabad. (Respondent) Assessee Represented: Shri Malhar Shah, AR. Revenue Represented: Shri Prathvi Raj Meena, CIT.D.R. Date of hearing : 18.02.2025 Date of pronouncement : 19.02.2025 आदेश/ORDER PER : DR. BRR KUMAR, VICE PRESIDENT: This appeal is filed by the Assessee as against the appellate order dated 25.09.2024 passed by the Commissioner of Income Tax (Exemption), Ahmedabad, relating to the Assessment Year N.A. 2. The assessee has raised the following grounds of appeal: ITA No.2027/Ahd/2024 Assessment Year N.A I.T.A No. 2027/Ahd/2024 A.Y. NA Page No 2 (1) Promotion of Culture and Heritage Does not Equate to Religious Purpose. (2) Guidance by a Jain Monk Does not imply Religious classification. (3) Trust’s activities focus on cultural preservation, humanitarian support, and social welfare, not solely religious purpose. (4) Donation to Akhil Bhartiya Shwetamber Murtipujak Tapagachha Jain Mahasangh is for charitable not religious purpose. (5) Opportunity of being heard is not provided for clarifying nature of expenses. (6) Opportunity of being is not provided for the reasons mentioned for rejection of application. 3. At the outset the Ld.AR for the assessee submitted the Ld. CIT(E) came to the conclusion that assessee has spent 31.5 % of the total expenses on account of religious activities and hence declined to grant registration u/s.80G of the Act. The Ld.AR argued that the Ld. CIT(E) erred in considering the amounts spent on preservation of cultural monuments and cultural promotion expenses as religious expenses . The Ld.AR argued that the expenses on account of religious activities should not exceed 5% of the total receipts for charitable purposes. Since the mater pertains to verification of the actual expenses, in the interest of justice, we remand the matter to the file of Ld.CIT(E) to verify the expenses and take a decision in accordance with the I.T.A No. 2027/Ahd/2024 A.Y. NA Page No 3 provisions of Income tax Act, pertaining to the grant of registration u/s.80G(5)(B) of the Act. 4. In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open court on 19.02.2025. Sd/- Sd/- (SIDDHARTHA NAUTIYAL) (DR.BRR KUMAR) JUDICIAL MEMBER VICE PRESIDENT (True Copy) Ahmedabad : Dated 19.02.2025 आदेश कᳱ ᮧितिलिप अᮕेिषत / Copy of Order Forwarded to:- 1. Assessee 2. Revenue 3. Concerned CIT 4. CIT (A) 5. DR, ITAT, Ahmedabad 6. Guard file. By order/आदेश से, उप/सहायक पंजीकार आयकर अपीलीय अिधकरण, अहमदाबाद "