NUTRICA FOUNDATION,MUMBAI V. COMMISSIONER OF INCOME TAX (EXEMPTION), MUMBAI

ITA 2252/MUM/2025

AI Insights

The case involves M/s. Nutrica Foundation appealing against the orders of the Commissioner of Income Tax (Exemption) which denied their registration under section 12AB of the Income Tax Act, 1961 for the Assessment Year 2025-26. The primary issue was the inclusion of clauses in the trust deed/MOA that were perceived to allow the application or receipt of funds outside India, which is not permissible under section 11 of the Act. The Assessee argued that the clauses did not intend to apply funds outside India and were willing to amend them if necessary. The tribunal found merit in the Assessee's willingness to amend the clauses and remanded the case for a fresh decision, allowing the appeals for statistical purposes.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 712685 (ITAT-MUMBAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-07-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Matter Remanded
• Court: TRIBUNAL
• Department Lawyers: SATYAPRAKASH R.SINGH; LD.
• Assessee Lawyers: M.M.AGARWAL; LD.; ANURAJ SINHA; LD.
• Keywords: Set aside; Opportunity of being heard
• Section: 11; 12AA; 12A; 80G

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH “B”, MUMBAI BEFORE SHRI NARENDER KUMAR CHOUDHRY, JUDICIAL MEMBER AND SHRI OMKARESHWAR CHIDARA, ACCOUNTANT MEMBER ITA No.2252/M/2025 Assessment Year: 2025-26 & ITA No.2253/M/2025 Assessment Year: 2025-26 M/s. Nutrica Foundation, 217, Adani, Inspire-BKC Bandra, G-Block, BKC Main Road, Government Colony, Mumbai - 400051 PAN: AAJCN4262B Vs. Commissioner of Income Tax (Exemption), 601, 6th Floor, Cumballa MTNL TE Building, Peddar Road, Dr. Gopalrao Deshmukh Marg, Mumbai - 400020 (Appellant) (Respondent) Present for: Assessee by : Shri M.M. Agarwal, Ld. C.A. & Shri Anuraj Sinha, Ld. Adv. Revenue by : Shri Satyaprakash R. Singh, Ld. D.R. Date of Hearing : 03.07.2025 Date of Pronouncement : 30.07.2025 O R D E R Per : Narender Kumar Choudhry, Judicial Member: These appeals have been preferred by the Assessee against the orders even dated 19.02.2025, impugned herein, passed by the Ld. Commissioner of Income Tax (Exemption) (in short Ld. Commissioner) under section 12AA of the Income Tax Act, 1961 (in short ‘the Act’) for the A.Y. 2025-26. Printed from counselvise.com ITA No.2252/M/2025 & ITA No.2253/M/2025 M/s. Nutrica Foundation 2 2. ITA No.2253/M/2025 is a lead case as the same pertains to registration u/s 12AB of the Act. Therefore, for the sake of brevity, we are inclined to decide ITA No.2253/M/2025 first. 3. The Assessee by filing an application in form No.10B had sought for registration u/s 12AB of the Act, which was taken into consideration by the Ld. Commissioner and by issuing a notice dated 09.01.2025 the Assessee was requested to furnish the complete set of documents. The Assessee, in response to such notice filed its submission vide letter dated 24.01.2025. On perusing the submission made by the Assessee, it was noticed by the Ld. Commissioner that “in the trust deed/MOA at point no.3(B)(5), (6), (7) & (15) and point no.4 of the objects there are violations of the provisions of section 11 of the Act, as the Assessee trust intends to apply/receive funds outside India” and therefore he issued a show cause notice dated 03.02.2025 to the Assessee, however, the Assessee made no response. Thereafter, a final opportunity was provided vide notice dated 11.02.2025 to the Assessee, in response to which the Assessee vide letter dated 14.02.2025 has made its submissions as reproduced by the Ld. Commissioner in para No.3. The Assessee before the Ld. Commissioner has claimed that “none of the above mentioned objects of MOA are in violation of section 11(1)(c) of the Act. It is not stated in these objects that the Assessee intends to apply funds outside India. It is merely mentioned that non-profit company intends to work with global recognized bodies. The Assessee assures that no fund will be applied outside India.” 4. Though the Ld. Commissioner considered the said contention of the Assessee, however, found the same as not acceptable and ultimately rejected the registration u/s 12A of the Act mainly by holding “that the applicant trust ought to have amended theses Printed from counselvise.com ITA No.2252/M/2025 & ITA No.2253/M/2025 M/s. Nutrica Foundation 3 clauses to align with the provisions of the Income Tax Act. However, it has failed to do so. Thus based on the reasons mentioned above, this application for registration u/s 12A of the Act is not allowable. As such in view of the statutory limitation to decide the application on or before 28.02.2025, the undersigned is left with no other option but to reject the application seeking registration u/s 12AB of the Act.” 5. We have given thoughtful considerations to the peculiar facts and circumstances of the case. Before us the Ld. Counsel for the Assessee has submitted that the Assessee is willing to amend the respective clauses and/or ready to remove the clauses, which allow the Assessee to apply/receive the funds outside India, if the opportunity be given to the Assessee. 6. The Ld. D.R. did not refute such claim of the Assessee. 7. Thus considering the peculiar facts and circumstances of the case as the Ld. Commissioner rejected the application filed by the Assessee mainly on the reason that the Assessee intends to apply/receive funds outside India whereas the Assessee has agreed to amend the respective clauses according to parameters enshrined in section 11 of the Act and/or objections/particular clauses raised by the Ld. Commissioner in the impugned order. Thus the impugned order is set aside and consequently the case is remanded to the file of the Ld. Commissioner for decision afresh, suffice to say while affording reasonable opportunity of being heard to the Assessee. The Assessee is directed to amend/modify the respective clauses within one month from the date of receipt of this order. 8. In the result, the appeal is allowed for statistical purposes. Printed from counselvise.com ITA No.2252/M/2025 & ITA No.2253/M/2025 M/s. Nutrica Foundation 4 9. Coming to ITA No.2252/M/2025. This appeal pertains to the non-granting of registration u/s 80G of the Act mainly on the reason that the Assessee does not have any appropriate registration for grant of registry u/s 80G of the Act. In view of our order in ITA No.2253/M/2025, this case is also remanded to the file of the Ld. Commissioner for decision afresh accordingly. Consequently, this appeal is also allowed for statistical purposes. 10. In the result, both the appeals under consideration are allowed for statistical purposes. Order pronounced in the open court on 30.07.2025. Sd/- Sd/- (OMKARESHWAR CHIDARA) (NARENDER KUMAR CHOUDHRY) ACCOUNTANT MEMBER JUDICIAL MEMBER * Kishore, Sr. P.S. Copy to: The Appellant The Respondent The CIT, Concerned, Mumbai The DR Concerned Bench //True Copy// By Order Dy/Asstt. Registrar, ITAT, Mumbai. Printed from counselvise.com "