ITAT Confirms Denial of Exemption to Trust in the absence of Mandatory Registration u/s 12AA [Read Order]

Trust

The Delhi bench Income Tax Appellate Tribunal in a recent order, confirmed the denial of income tax exemption to Trust in the absence of mandatory registration under Section 12AA of the Income Tax Act.

The Delhi bench comprising Judicial Member H.S. Sidhu and Accountant Member L.P. Sahu were held so while rejecting the assessees appeal which challenged the impugned order passed by the Commissioner of Income Tax (Appeals), Ghaziabad.

The assessee has filed its return of income in the status of AOP (Trust) showing taxable income at NIL after claiming exemption under section 11 of the Income Tax Act, 1961  towards excess of income over expenditure at Rs. 4,77,10,186/-.

The AO during the proceedings, held that the assessee is not eligible for exemption u/s 11 of the income Tax Act since as on date the assessee has no registration u/s 12A of the Act, 1961.

Accordingly, the assessment was completed and passed u/s. 143(3) of the Act on total income at Rs. 4,77,10,186/-. Against the assessment order, the assessee appealed before the CIT (A), through his impugned order has held that it is uncontroverted fact that as on date the assessee does not enjoy registration u/s. 12AA and such registration is mandatory for availing exemption.

Aggrieved with the impugned order passed by the CIT (a), Ghaziabad, Assessee is in appeal before the Tribunal.

The counsel for revenue relied upon the decision of lower authority and argued that issue involved in the present appeal is exactly similar to the issue involved in the case of Jammu Development Authority vs. UOI which has been decided in favour of the Revenue by the Apex court.

The tribunal bench upheld the order of the first appellate authority by holding that as on date the Assessee is not in possession of registration u/s. 12AA of the Act, which is mandatory for availing the exemption u/s. 11 to 13 of the I.T. Act, 1961.

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