SISTERS OF OUR LADY OF MERCY SOCIETY,NAGERCOIL V. CIT - EXEMPTION CHENNAI, CHENNAI

ITA 3168/CHNY/2026

AI Insights

The case involves the Sisters of Our Lady of Mercy Society, a trust, which appealed against the orders of the Commissioner of Income Tax (Exemptions), Chennai, denying them registration under section 12AB and approval under section 80G of the Income Tax Act, 1961. The CIT(E) had rejected their applications on the grounds of insufficient documentation to verify the genuineness of the trust's activities and its objects. The tribunal found that the CIT(E) had not adequately considered the documents submitted by the trust in response to the notices. Consequently, the tribunal remitted the matter back to the CIT(E) for a thorough re-examination of the provided documents and any further necessary details.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 896662 (ITAT-CHENNAI)
• Duration Of Justice: 4 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-10-2026
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 07-10-2026
• Assessment Year: misc
• Appeal Filed On: 27-05-2026
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 12A; 80G

Judgement Text

"aआयकर अपीलीय अिधकरण, ‘डी’ ा यपीठ, चे\u0012ई। IN THE INCOME TAX APPELLATE TRIBUNAL ‘D’ BENCH: CHENNAI \u0015ी जॉज\u0018 जॉज\u0018 क े, उपा \u001a\u001b एवं सु\u0015ी पदमा वती यस, लेखा सद% क े सम\u001b BEFORE SHRI GEORGE GEORGE K, VICE PRESIDENTAND MS. PADMAVATHY.S, ACCOUNTANT MEMBER ITA Nos.3167 & 3168/CHNY/2026 िनधा \u0018रण वष\u0018/Assmt. Years: 2026-27 SISTERS OF OUR LADY OF MERCY SOCIETY, IV-11-31/330, MERCY CONVENT, KARUNYA PURAM, NAGERCOIL-629176, TAMIL NADU PAN: AAGAS2278D Vs. CIT ( EXEMPTIONS), CHENNAI (अपीला थ) / Appellant) (*+थ) / Respondent) िनधा\u0005\u0006रती ारा/Assessee represented by: Mr. R. Viswanathan, C.A. राज व ारा/Revenue represented by: Mr. K. Jayaganesh, CIT सुनवाई की तारीख / Date of conclusion of hearing: 07-10-2026 घोषणा की तारीख / Date of pronouncement: 12-10-2026 आदेश / O R D E R PER PADMAVATHY.S, A.M: These appeals by the assessee are against separate orders of the Commissioner of Income Tax (Exemptions), Chennai (in short \"CIT(E)\") both dated 29.03.2026 denying registration u/s. 12AB of the Income Tax Act, 1961 (in short \"the Act\") and approval u/s. 80G of the Act. Printed from counselvise.com ITA Nos.3167 & 3168/Chny/2026 Sisters of Our Lady of Mercy Society :- 2 -: 2. The assessee is a trust and filed the application for registration u/s. 12AB of the Act in Form-10AB on 09.09.2025. The CIT(E) called on the assessee to furnish the trust deed, financials, and note on activities along with copy of approval u/s. 12A of the Act obtained in the old regime. The CIT(E) rejected the application on the ground that the assessee has not filed all the required details. The observations of CIT(E) in this regard are extracted below: 5. As per the provisions of section 12AB(1)(b) of the Income-tax Act, 1961, where an application is made under section 12A(1)(ac), if the Principal Commissioner or Commissioner is not satisfied about the objects of the trust or institution and the genuineness of its activities, he may reject the application.In the present case, the applicant has failed to comply with the notices issued and has not furnished all the mandatory documents required for examining the objects and genuineness of the activities, despite being afforded reasonable opportunities. Therefore, the application in Form No. 10AB filed by the applicant could not be processed for the specific reasons mentioned in para 2 above relevant to the list of documents not submitted as mentioned in para. Accordingly, the application filed by the applicant in Form No. 10AB seeking registration u/s 12AB of the Income-tax Act, 1961 is hereby rejected. 3. We have heard the parties and perused the material available on record. The Ld. Authorized Representative (AR) of the assessee submitted that the assessee in response to notice dated 24.12.2025 submitted various details such as activity report, memorandum, financial statements, registration certificate etc. on 07.01.2026. The Ld. AR submitted the copy of details furnished before lower authorities to substantiate the above claim. From the perusal of the order of the CIT(E), we notice that the CIT(E) had rejected the application stating that the assessee has not furnished registration u/s. 12A of the Act in the old regime. We further notice that the CIT(E) has not considered the other Printed from counselvise.com ITA Nos.3167 & 3168/Chny/2026 Sisters of Our Lady of Mercy Society :- 3 -: details submitted nor the CIT(E) has recorded any adverse findings with regard to the details furnished. During the course of hearing, the Ld. AR prayed that if one more opportunity is given, the registration u/s.12A under the old regime as called for by CIT(E) would be furnished along with any other details that may be called for. Considering the facts peculiar to the assessee’s case, we are inclined to give one more opportunity to the assessee for producing the details before the CIT(E). Accordingly, we remit the appeal back to the CIT(E) with a direction to consider the details already furnished and to call for any other necessary details required to decide the issue in accordance with law. The assessee is required to submit the necessary details as may be called for and cooperate with the proceedings. It is ordered accordingly. 4. From the perusal of the order rejecting the approval u/s. 80G of the Act, we notice that it is rejected for the same reason that the assessee has not furnished the details called for similar to rejection of registration u/s.12AB of the Act. The Ld. AR during the course of hearing also submitted the copy of the details furnished before the CIT(E) with regard to registration u/s. 80G of the Act and prayed for one more opportunity. The registration u/s. 80G of the Act being consequential to the registration u/s. 12AB of the Act and considering that we have remitted the issue of registration u/s. 12AB of the Act back to the CIT(E), we deem it fit to remit the issue of approval u/s. 80G of the Act also back to the CIT(E) to be considered along with registration u/s. 12AB of the Act with a similar directions. Printed from counselvise.com ITA Nos.3167 & 3168/Chny/2026 Sisters of Our Lady of Mercy Society :- 4 -: 5. In the result, both the appeals of the assessee are allowed for statistical purposes. Order pronounced on 12th day of October, 2026 at Chennai. Sd/- Sd/- (जॉज\u0018 जॉज\u0018 क े) (George George K) उपा\u001a\u001b / Vice President (पदमावती यस) (Padmavathy.S) लेखा सद% /Accountant Member चे ई/Chennai, िदनांक/Dated: 12th October, 2026. EDN, Sr. P.S आदेश की ितिलिप अ#ेिषत/Copy to: 1. अपीलाथ%/Appellant 2. &थ%/Respondent 3. आयकर आयु(/CIT, Chennai/Madurai/Coimbatore/Salem 4. िवभागीय ितिनिध/DR 5. गाड\u0005 फाईल/GF Printed from counselvise.com EJTADA DURGA NARESH Digitally signed by EJTADA DURGA NARESH Date: 2026.10.14 11:54:40 +05'30' "