SAHSHTRAKOOT VIGYAATEERTH,JAIPUR V. CIT (EXEMPTION), JAIPUR, JAIPUR

ITA 14/JPR/2025

AI Insights

The case involves Sahshtrakoot Vigyaateerth, a trust, appealing against the rejection of its application for registration under section 12AB of the Income Tax Act, 1961 by the CIT(Exemption), Jaipur. The application was initially rejected on five grounds including non-maintainability due to lack of a valid provisional certificate, non-registration under the Rajasthan Public Trust Act, 1959, provision for activities outside India, activities benefiting a particular community, and non-genuineness of activities. The tribunal found that the CIT(E) had erred in rejecting the application without allowing the trust an opportunity to rectify the defects in its application.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 28435 (ITAT-JAIPUR)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-02-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: misc
• Other Referred Cases: APJ Abdul Kalam Education and Welfare Trust, ITA No. 567/JPR/2024
• Laws Referred To: Income Tax Act, 1961, Rajasthan Public Trust Act, 1959
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MANOJ KUMAR
• Assessee Lawyers: RAJEEV SOGANI
• Keywords: Set aside; Opportunity of being heard
• Section: 11; 12A; 13; 12

Judgement Text

" vk;dj vihyh; vf/kdj.k] t;iqj U;k;ihB] t;iqj IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES,”A” JAIPUR Jh xxu xks;y] ys[kk lnL; ,o Jh ujsUnz dqekj] U;kf;d lnL; ds le{k BEFORE: SHRI GAGAN GOYAL, AM & SHRI NARINDER KUMAR, JM vk;dj vihy la-@ITA No. 14/JP/2025 Sahshtrakoot Viggaateerth A-803 Ashadeep Green Avenue, Jagatpura, Jaipur cuke Vs. CIT(Exemption), Jaipur LFkk;h ys[kk la-@thvkbZvkj la-@PAN/GIR No.: ABFTS 4497 K vihykFkhZ@Appellant izR;FkhZ@Respondent fu/kZkfjrh dh vksj ls@ Assessee by : Sh. Rajeev Sogani. jktLo dh vksj ls@ Revenue by : Sh. Manoj Kumar, JCIT-DR lquokbZ dh rkjh[k@ Date of Hearing : 19/02/2025 mn?kks\"k.kk dh rkjh[k@Date of Pronouncement: 19/02/2025 vkns'k@ ORDER PER: NARINDER KUMAR, JUDICIAL MEMBER The appellant is feeling aggrieved by the rejection of its application presented u/s 12AB of Income Tax Act, 1961, vide order dated 13.11.2024 passed by Ld. CIT(Exemption). 2. Application was submitted on 04.05.2024, u/s 12A(1)(ac)(iii), in Form No. 10AB. 3. Ld. CIT(E) rejected the application on the following five grounds: 2 ITA No. 14/JP/2025 Sahshtrakoot Vigyaateerth vs. CIT(E) • Premature/Non-maintainable application without valid provisional certificate • Non-registration under Rajasthan Public Trust Act, 1959 • Provision for activities outside India • Activities/Beneficiaries are for particular community • Non-Genuineness of Activities. 4. Arguments heard. File perused. We proceed to discuss the submissions put forth by Learned AR for the appellant and Learned DR for the Revenue as regards each ground of rejection of the application under section 12 AB of the Act. Non-maintainability of application for want of a valid provisional certificate 5. Vide impugned order, Ld. CIT(E) was of the view that the applicant had no valid provisional certificate. As observed by the CIT(E), from the bank statement submitted by the applicant, it was found to have commenced activities w.e.f. 19.12.2023, but, the applicant had obtained provisional registration under item- A of sub clause (vi) of clause (ac) of sub-section 1 of section 12A of the Act. 6. Ld. AR for the appellant has submitted that due to inadvertent mistake, the applicant could not apply for provisional registration, referring to the correct provision of law. 3 ITA No. 14/JP/2025 Sahshtrakoot Vigyaateerth vs. CIT(E) In this regard, Ld. AR for the appellant has further submitted that it being a curable defect, Ld. CIT(E) should have allowed the applicant to remove said deficiency instead of dismissing its prayer for registration u/s 12AB of the Act, on the aforesaid ground. 7. In the course of arguments, Ld. DR for the department has not controverted the submission put forth by Ld. AR for the appellant that while submitting application for provisional registration, the applicant-trust had selected wrong provision of law. 8. In the given situation, ld. CIT(E) should have afforded opportunity to the applicant for removal of the said defect and, thereafter, proceeded to dispose off of the application u/s 12AB of the Act, instead of making the said defect a ground for rejection of said application. In the given situation, we deem it a fit case to remit the matter to Learned CIT(E) to afford opportunity to the applicant to do the needful in this regard i.e. for removal of defect by applying under the relevant or correct provision of law. Non-registration under Rajasthan Public Trust Act, 1959 4 ITA No. 14/JP/2025 Sahshtrakoot Vigyaateerth vs. CIT(E) 9. Admittedly, initially applicant-trust was not got registered under RPT Act, 1959, Ld. AR for the appellant has drawn our attention to page No. 25 of the paper book, which is photocopy of certificate of registration of the trust under RPT Act. Said certificate is dated 05.11.2024. The impugned order passed by Ld. CIT(E) is dated 13.11.2024. Having regard to the date of issuance of certificate dated 05.11.2024, we have inquired from Ld. Counsel for the appellant as to why the same was not produced before Ld. CIT(E) during the pendency of the application. 10. Ld. AR for the appellant has submitted that actually on 5.11.2024, the applicant had sought adjournment in the proceedings before Learned CIT(E), but he proceeded to reject the main application vide order dated 13.11.2024. 11. Available in the paper book, at page No. 50 is copy of communication from the assessee to the office of Ld. CIT(E) seeking adjournment on 05.11.2024. 12. Even otherwise, Co-ordinate Bench of ITAT, Jaipur Benches has held in case titled as APJ Abdul Kalam Education and Welfare Trust, 5 ITA No. 14/JP/2025 Sahshtrakoot Vigyaateerth vs. CIT(E) ITA No. 567/JPR/2024, decided on 15.01.2025, that for the purposes of registration u/s 12AB of the Act, registration of such like applicant under RPT Act, 1959 is not one of the essential requirements. 13. The fact remains that even though the application was rejected vide order dated 13.11.2024, the applicant Trust had got itself registered as per certificate dated 5.11.2024. In view of said certificate, said ground of rejection no more survives. Provision for activities outside India 14. While making said ground as basis for rejection of the application u/s 12AB, Ld. CIT(E) has observed that as per provisions of section 11(1)(c) of the Act income applied on activities outside India is not eligible for exemption unless CBDT has vide general or speaking order granted exemption, but the applicant did not furnish any such order from CBDT granting said exemption. 15. Ld. AR for the appellant has submitted that clause No. 4(iii) of the Trust deed enables the appellant trust to connect and associate with institutions, having similar objects, situated within or beyond India. 6 ITA No. 14/JP/2025 Sahshtrakoot Vigyaateerth vs. CIT(E) The contention raised by Ld. AR is that simply because the appellant trust has one of the said objects, it cannot be said that appellant has been indulging in charitable or religious activities out of India, disentitling it for its registration under section 12 AB of the Act. 16. Ld. AR for the appellant has rightly submitted that simply from the above said object of the appellant trust, to connect and associate with institutions, having similar objects, and situated outside India, cannot amount to carrying out charitable or religious activities outside India. At the most, it would be within the domain of the Assessing Officer to take into consideration any such activity carried outside India, for the purposes of grant or denial of exemption u/s 11 of the Act, during assessment proceedings. In this way, Ld. CIT(E), while taking into consideration said object clause, for the purpose of registration of the appellant-trust under the Act, can safely said to have exceeded the scope of inquiry. 17. In view of the above discussion, this ground raised by Learned CIT(E) for rejection of the application is hereby set aside. Activities/Beneficiaries for a particular community 7 ITA No. 14/JP/2025 Sahshtrakoot Vigyaateerth vs. CIT(E) 18. In para 5.1 of the impugned order, Learned CIT(E) observed that as per object clauses 4(i) to (iii) of the Trust deed said activities of the applicant Trust are for the benefit of Jain community only. He further observed that from the said objects, it was noticed that the applicant wanted to restrict activities of Bed and Food only for Jain Sadhus-Ratnatrya Dharak Sadhus. 19. Learned AR for the appellant has submitted that in view of the objects as contained in the Trust deed, its objects are religious and charitable in nature. 20. Admittedly, at the time of grant of provisional registration to the applicant, though on an application filed under incorrect provision of law, expression “Religious cum Charitable” was used, at this stage, it cannot be said that activities of the applicant are restricted to any particular community. 21. On this issue, Learned CIT(E) referred to the provisions of section 13 of the Act. In this regard, suffice it to state that applicability of provisions of section 13 is not to be seen at the time an applicant seeks registration under section 12 AB of the Act. Therefore, the 2 decisions relied on by learned CIT(E) in this regard do not come to the aid of the department. 8 ITA No. 14/JP/2025 Sahshtrakoot Vigyaateerth vs. CIT(E) 22. Consequently, this ground raised by Learned CIT(E) for rejection for the application is also set aside. Non Genuineness of activities 23. Learned AR for the appellant has submitted that for the purposes of verification of genuineness of activities, few details were asked by Learned CIT(E) to be submitted on or before 5.11.2024, as per notice, but the applicant sought adjournment. Further, it has been submitted that no reasonable opportunity was granted to the applicant in this regard, and rather, the application was rejected. Therefore, he submits that matter needs reconsideration after taking into account all the requisite details, which the applicant would make available. 24. As noticed above, applicant had sent request for adjournment from 5.11.2024, but the impugned order followed on 13.11.2024. Having regard to the nature of the details, we deem it a fit case where the applicant should be afforded reasonable opportunity of being heard. With these observations, the ground for rejection of the application is set aside, but Learned CIT(E) to provide reasonable opportunity of being heard, to the applicant. 9 ITA No. 14/JP/2025 Sahshtrakoot Vigyaateerth vs. CIT(E) Result 25. In view of the above discussion, this appeal is disposed of for statistical purposes, and the matter is restored to the files of Learned CIT(E) for decision on the application afresh, except the issues finalized herein, of course, after providing reasonable opportunity of being heard to the applicant, and that too in accordance with law. Applicant-appellant to comply with all the directions of Learned CIT(E) issued from time to time to avoid any delay in the disposal of the application. Order pronounced in the open court on 19 /02/2025. Sd/- Sd/- ¼xxu xks;y ½ ¼ujsUnz dqekj½ (GAGAN GOYAL) (NARINDER KUMAR) ys[kk lnL;@Accountant Member U;kf;d lnL;@Judicial Member Tk;iqj@Jaipur fnukad@Dated:- 19 /02/2025 *Ganesh Kumar, Sr. PS vkns'k dh izfrfyfi vxzsf’kr@Copy of the order forwarded to: 1. The Appellant- Sahshtrakoot Vigyaateerth, Jaipur 2. izR;FkhZ@ The Respondent- CIT(E), Jaipur 3. vk;dj vk;qDr@ The ld CIT 4. vk;dj vk;qDr¼vihy½@The ld CIT(A) 5. foHkkxh; izfrfuf/k] vk;dj vihyh; vf/kdj.k] t;iqj@DR, ITAT, Jaipur 6. xkMZ QkbZy@ Guard File (ITA No. 14/JP/2025) vkns'kkuqlkj@ By order, lgk;d iathdkj@Asst. Registrar "