No Evidence to challenge the Genuineness of object of Charitable Trust: Delhi HC upholds ITAT Order [Read Order]

The Delhi High Court upheld the order of ITAT when there was no evidence to challenge the genuineness of the object of the charitable trust.

The revenue contended that the ITAT erred in directing the CIT(E) to register the Assessee Society under Section 12AA of the Income Tax Act, 1961, (‘Act’) considering that, there were doubts concerning the genuineness of the activities of the Respondent. 

It was alleged that the ITAT failed to consider the fact that cash deposits to the tune of Rs. 17,00,000/- were made in the bank account of the Assessee during the Financial Year (‘FY’) 2016-17, which raises questions concerning the genuineness of the objectives of the society

Mata Parvati Educational & Innovative Society, the Respondent society is engaged in the activity of imparting education by running a school, the Rainbow Kids  Valley School, which fact is not in dispute. The Respondent applied on 23rd August, 017 in Form No. 10A seeking registration under Section 12AA of the Act. The Authorised Representative (‘AR’) of the Respondent appeared before the CIT(E) and filed certain documents.

The CIT(E) observed that there were cash deposits in the bankaccount during the Financial Year (FY) 2016-17 which were not found supported by the corresponding documentation. He observed that the school run by the Petitioner is not recognised by the Department of Education, Government of NCT of Delhi (GNCTD) and in the absence of formal recognition the functioning of the school cannot be validly claimed.

The CIT(E) concluded that the Assessee was not able to satisfactorily establish the genuineness of the conduct of the charitable activity as defined in Section 2 (15) of the Act and required under Section 12AA of the Act. The CIT(E)rejected the application of the Assessee under Section 12AA of the Act.

The Court comprising Justice Manmohan and Justice Manmeet Pritam Singh Arora observed that there isno adverse finding of the Assessing Officer against the Assessee with respect to the saidcash  deposits. The scope of the application was to examine the genuineness of the objects of the society and to ascertain if the said objects are charitable or not. While dismissing the appeal, the Court upheld the order of the ITAT.

To Read the full text of the Order CLICK HERE

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