ITAT Remands Matter for VerificationRemand for verification [Read Order]

The Rajkot Bench of the Income Tax Appellate Tribunal (ITAT) has set aside the order of the Commissioner of Income Tax (Exemption), Ahmedabad, which had denied approval under Section 80G(5)(iii) to assessee, and remanded the matter for fresh examination.

The Bench held that the CIT(E) must verify whether the Trust genuinely represents a Scheduled Tribe (Bhil-Meena/Meena) community as notified under the Constitution (Scheduled Tribes) Order, 1950, before concluding that its objects are “religious” or violative of Section 80G conditions.

The assessee, Meena Samaj Seva Samiti Trust, had filed an online application in Form 10AB seeking approval under Section 80G(5)(iii) of the Income Tax Act, 1961 for A.Y. 2024-25.

During processing, the CIT(E) issued notices seeking details of activities, objects, and documentary evidence. After considering the submissions, the CIT(E) rejected the application and also cancelled the provisional 80G approval, primarily on grounds that:

● Certain objects of the trust indicated religious inclination,

● The trust appeared to be for the benefit of a specific caste/community

● No evidence was filed to establish amendment/removal of religious objects

● Hence, the trust violated Section 80G(5)(ii) & (iii) which require exclusive charitable purpose without religious bias

Before the Tribunal, the assessee submitted the Trust represents and works for “Bhil-Meena / Meena”, which is recognised as a Scheduled Tribe under Explanation 1 to Section 80G(5), which states that any institution established for the benefit of SCs/STs/backward classes/women/children shall not be considered as one established for a religious community or caste. Therefore, the trust does not violate Section 80G conditions and does not cater to a prohibited “caste” or “religious community”.

The assessee placed reliance on the Constitution (Scheduled Tribes) Order, 1950, which specifically includes “Bhil Meena/Bhil Mina/Bhil” as Scheduled Tribes in the State.

All-in-One Manual with Updated GST Laws & Provisions, Click here

The Departmental Representative maintained that the trust’s stated objects appear religious in nature, and the assessee has not conducted activities showing benefit to the general public.

The ITAT Bench comprising Dr. Arjun Lal Saini (Accountant Member) and Dinesh Mohan Sinha (Judicial Member) noted that Bhil-Meena / Meena is indeed listed as a Scheduled Tribe under the Constitution (ST) Order, 1950.

It was found that the CIT(E) did not examine whether the trust actually represents a Scheduled Tribe community, and such verification is essential before concluding that the trust violates 80G(5)(iii).

The Bench emphasised that the CIT(E) must evaluate the Government Notification on Scheduled Tribes, and relevant evidence submitted by the Trust to ascertain whether its objects, in substance, serve a Scheduled Tribe group and thereby fall outside the prohibition under Section 80G.

The ITAT remanded the matter and directed the CIT(E) to examine the ST Notification and verify whether the trust falls within the recognised Scheduled Tribe category (Bhil-Meena) and if it does, approval under Section 80G(5)(iii) should be granted as per law. Further, the assessee was directed to furnish all relevant documents, including the ST Notification and supporting evidence and CIT(E) must provide adequate opportunity of being heard and pass a speaking order.

The appeal was allowed for statistical purposes.