Case Number: ITA 5817/DEL/2019
Appellant: Jat Sewa Singh, Delhi
Respondent: CIT (Exemption), New Delhi
Assessment Year: 2019-20
Result: Appeal Allowed
Case Filed on: 2019-07-04
Order Type: Final Tribunal Order
Date of Order: 2019-09-23
Pronounced on: 2019-09-23
The appeal filed by Jat Sewa Singh for the assessment year 2019-20 was directed against the order of the Commissioner of Income Tax (Exemption), New Delhi. The primary issue in this appeal was the rejection of the application for registration under Section 12AA of the Income Tax Act, 1961.
Jat Sewa Singh, a charitable trust based in Delhi, sought registration under Section 12AA of the Income Tax Act, 1961. The Commissioner of Income Tax (Exemption) rejected the application on the grounds that the genuineness of the trust’s activities could not be established due to the absence of proper explanation regarding the donations received.
The appellant raised the following grounds of appeal:
The appellant was represented by Sh. R.S. Singhvi, CA, and the Department was represented by Ms. Nidhi Srivastava, CIT DR. The appellant’s counsel argued that the Commissioner of Income Tax (Exemption) incorrectly rejected the registration application based on the source of donations, which is not a relevant factor at the time of registration. The appellant relied on various judicial precedents to support this argument.
The Department’s representative, Ms. Nidhi Srivastava, CIT DR, argued that the genuineness of the donations could not be verified, and therefore, the activities of the trust could not be deemed genuine.
The Tribunal examined the trust deed dated 12.5.2017 and noted the following objects of the trust:
The Tribunal noted that the Commissioner of Income Tax (Exemption) did not dispute the charitable nature of the trust’s objects but rejected the application based on the unverifiability of the donations received.
The Tribunal referred to several judicial precedents, including CIT vs. Babu Ram Educational Society [2018] 96 Taxmann.com 606 (All HC) and DIT vs. Foundation of Ophthalmic & Optometry Research Education Centre [2013] 355 ITR 361 (Delhi HC), which established that at the time of registration, the relevant consideration is the charitable nature of the trust’s objects, and the genuineness of donations should be examined at the time of assessment.
In light of the judicial precedents and the charitable nature of the trust’s objects, the Tribunal held that the Commissioner of Income Tax (Exemption) was not justified in rejecting the registration application. The Tribunal directed the Commissioner of Income Tax (Exemption) to grant registration to the appellant trust under Section 12AA of the Income Tax Act.
Order Pronounced in Open Court on 23rd September, 2019.
Signed:
G.S. Pannu, Vice President
K. Narsimha Chary, Judicial Member
Dated: 23rd September, 2019
Date of Hearing: 16.09.2019
Date of Pronouncement: 23.09.2019
By Order
Assistant Registrar, ITAT, New Delhi
Jat Sewa Singh vs CIT (Exemption): Registration Appeal under Section 12AA for AY 2019-20
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