Conditions to grant Registration of Charitable Trust can't go beyond the Scheme of Law: ITAT [Read Order]

The Mumbai Bench of the Income Tax Appellate Tribunal (ITAT) held that the Income Tax Authorities cannot impose conditions beyond the scheme of law while granting registration to charitable institutions and trusts under Section 12A of the Income Tax Act, 1961.

The appellant challenged the order dated 24th September 2021 passed by the Commissioner of Income Tax which grants registration under section 12A of the Income Tax Act, 1961

The assessee, Bai Navajbai Tata Zoroastrian Girls Schoolis a charitable institution and is, vide order dated 24th September 2021, granted registration under section 12A where the CIT imposed conditions based on which the registration was granted to the assessee. In the impugned order it was stated that the registration granted to the assessee,would be liable to be withdrawn if the assessee violated any of the conditions mentioned in the said order.

The assessee contended that there is no provision which permits the CIT to grant conditional registration under Section 12A and the CIT does not have the authority to impose such condition other than in the act itself.

The Bench, consisting of Pramod Kumar (Vice President) and Aby T Varkey (Judicial Member) observed that the Commissioner of Income Tax (CIT) cannot supplement the law by laying down the conditions which are not a part of the scheme of registration visualized by law.

The Tribunal observed that the conditions concerning the conduct of the trust and the circumstances in which the registration granted to the appellant can be cancelled as these are regulated by the specific provisions of law. Further observed that if the scheme of the law does not visualize these conditions being part of the scheme of the registration being granted to the applicant trust, then the Commissioner cannot supplement the law.  The appeal was allowed

The assessee was represented by Atul Suraiya and the revenue was represented by Dr Mahesh Akhade.

To Read the full text of the Order CLICK HERE

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