VEDA SROUTHA GURUKULAM,EDAPPAL, MALAPPURAM V. COMMISSIONER OF INCOME TAX, EXEMPTION

ITA 170/COCH/2024

AI Insights

The case involves Veda Sroutha Gurukulam, a trust, appealing against the decision of the Commissioner of Income Tax (Exemption), Kochi, which had rejected their application for registration under section 12A of the Income Tax Act, 1961. The Commissioner had denied the registration on the grounds that the trust's activities were minuscule, suggesting it was premature to grant registration. The Tribunal, however, found this reasoning flawed, noting that the trust could not begin its activities without the registration, and thus, the Commissioner should not have imposed such a condition for the registration under section 12A.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 23516 (ITAT-COCHIN)
• Duration Of Justice: 6 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-10-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: misc
• Appeal Filed On: 06-03-2024
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SANJIT KUMAR DAS
• Section: 12A

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH, COCHIN Before Shri Waseem Ahmed, Accountant Member and Shri Soundararajan K., Judicial Member ITA No. 170/Coch/2024 Veda Sroutha Gurukulam Narayanamangalath Mana Edappal, Malappuram 679576 [PAN: AADTV1960H] vs. Commissioner of income Tax (Exemption) Aayakar Bhavan, Old Rly. Station Road, Kochi 682018 (Appellant) (Respondent) Appellant by: ------ None ------ Respondent by: Shri Sanjit Kumar Das, CIT-DR Date of Hearing: 30.09.2024 Date of Pronouncement: 03.10.2024 O R D E R Per Bench This appeal filed by the assessee is directed against the order of the Commissioner of Income Tax (Exemption), Kochi dated 15.01.2024 u/s 12A of Income Tax Act, 1961 (hereinafter \"the Act\"). 2. When the appeal was called for hearing, none appeared on behalf of the assessee and there was also no adjournment application. Therefore, we proceed to hear the appeal exparte qua the assessee. 2.1 The only issue raised by the assessee is that the Commissioner of Income Tax (Exemption) erred in rejecting the registration application u/s. 12A of the Act. 2 ITA No. 170/Coch/2024 Veda Sroutha Gurukulam 3. At the outset, we note that the assessee has been denied registration u/s 12A of the Act by the Commissioner of Income Tax (Exemption) on the reasoning that the activities of the assessee are miniscule. Therefore, it is premature to grant registration u/s 12A of the Act. 4. Being aggrieved by the order of the ld. CIT(E), the assessee is in appeal before us. 5. The learned CIT-DR before us vehemently supported the order the Commissioner of Income Tax (Exemption). 6. We have heard the learned CIT-DR and perused the materials available on record. It is the admitted position that the Commissioner of Income Tax (Exemption) has to verify the activities of the trust to find out whether they are in consonance with the objects of the trust. But such a condition cannot be imposed in the case of fresh registration of a trust u/s 12A of the Act. It is for the reason that the assessee could commence its activities only after having a valid registration u/s 12A of the Act in an effective manner. Thus, we are not convinced with the basis adopted by the ld. Commissioner of Income Tax (Exemption) for rejecting the application u/s 12A of the Act. Furthermore, the ld. Commissioner of Income Tax (Exemption) has not pointed out any-flaw in the objects of the trust.Nevertheless, in the interest of justice and fair play, we restore the matter to the file of the ld. CIT(Exemption) for granting registration as per the provisions of law. Hence, the ground of appeal of the assessee is hereby allowed for statistical purposes. 7. In the result, appeal filed by the assessee is hereby allowed for statistical purposes. 3 ITA No. 170/Coch/2024 Veda Sroutha Gurukulam Order pronounced on 03rd October, 2024 under Rule 34 of The Income Tax (Appellate Tribunal) Rules, 1963. Sd/- Sd/- (Soundararajan K.) JudicialMember (Waseem Ahmed) AccountantMember Cochin, Dated: 03rd October, 2024 n.p. Copy to: 1. The Appellant 2. The Respondent 3. The Pr. CIT concerned 4. The Sr. DR, ITAT, Cochin 5. Guard File Assistant Registrar ITAT, Cochin "