|The Tax Publishers2021 TaxPub(DT) 0130 (Chd-Trib)
INCOME TAX ACT, 1961
Where CIT declined registration under section 12AA to assessee-trust mainly on the ground that the assessee was predominantly doing religious activities and that the same did not fall under the character of charitable activity; however, as per the relevant provisions of section 11 read with section 12AA, the registration can be granted to charitable or religious institution, therefore, the CIT was not justified in declining the registration to the assessee under section 12AA.
Charitable trust - Registration under section 12AA - Denial - Assessee was predominantly doing religious activities
Assessee-trust applied for registration under section 12AA. CIT observed that the trust had been performing activities such as Sri Krishna Janmashtami Utsav, Holi Milan Samaroh, Bhandara, etc. and those activities did not measure up to the parameters of any of the limbs under section 2(15). Further, it was also observed that the assessee incurred major expenditures on Utsav and celebration, Sewa and Puja samagri, bhandara expenses etc. in last three years, which indicated that the assessee was predominantly involved in worship of idol of Shri Govardhan Nath Ji for which the temple was constructed. Therefore, it was clear that the trust used receipts predominantly for pursuing activities that did not fall under the character of charitable purposes. Accordingly, the CIT rejected the application of the trust under section 12AA. Held: The objects of the trust included worship of idol of Shri Goverdhannath Ji and maintenance of the temple and to follow the principles of service, good objects, Bhog, festival, Bhakti, kirtan, etc. Further, one of the objects of the trust was to impart education to students without any discrimination of caste or religion; to give scholarship and help to needy students for higher education, etc. Apart from that, objects of organizing medical camps, blood donations were also part of the objects as per bye laws of the trust. Further, the trust was also holding the activity of 'Bhandara' (free food) to all. Further, the CIT declined registration mainly on the ground that the assessee was predominantly doing religious activities and that the same did not fall under the character of charitable activity. However, as per the relevant provisions of section 11 read with section 12AA, the registration can be granted to charitable or religious institution. Therefore, there was no justification on the part of the CIT to decline the registration to the assessee and accordingly, the CIT was directed to register the assessee-trust under section 12AA.
FAVOUR : In assessee's favour.
IN THE ITAT, CHANDIGARH BENCH
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