This article examines the appeal by Roop V.K Jain Foundation against the decision by the Commissioner of Income Tax (Exemption), Chandigarh, denying the registration under section 12AA for the assessment year 2020-21, as detailed in ITA No. 297/DEL/2021.
The case revolves around the denial of registration under section 12AA to the Roop V.K Jain Foundation by CIT (E), Chandigarh, citing deficiencies in the trust deed, specifically the absence of a dissolution clause. The case was heard by the Delhi ITAT, which overturned the decision of the CIT(E).
The foundation argued that the denial was unjust and arbitrary, not based on the genuineness of its charitable activities but on technical grounds regarding the trust deed’s structure. The counsel for the assessee relied on various precedents that support the notion that the absence of a dissolution clause should not be a sole reason for denying 12AA registration if the trust’s charitable nature and operational genuineness are evident.
The ITAT directed the CIT(E) to grant registration, noting that the trust deed’s lack of a dissolution clause does not inherently negate the trust’s charitable purposes. The tribunal also suggested that the foundation amend its trust deed to include such a clause, aligning with regulatory expectations.
The case highlights the complexities and nuances involved in the registration of charitable trusts under the Income Tax Act, emphasizing the importance of compliance with procedural requirements while also acknowledging the substantive mission of charitable organizations. This decision is significant for other trusts facing similar issues, providing a precedent on balancing technical compliance with the overarching charitable intent. and>
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