KVG Memorial Trust Vs CIT (ITAT Bangalore)
The Bangalore ITAT in the case of KVG Memorial Trust examined rejection of permanent registration u/s 12AB and approval u/s 80G, which was denied mainly on the ground that no charitable activities had yet commenced.
The Tribunal first condoned the delay of 109 days, noting that the assessee had mistakenly filed a fresh application instead of appeal based on wrong advice, and acted promptly thereafter.
On merits, the ITAT found that:
- The trust had already taken concrete steps (e.g., ₹75 lakh spent on leasing land) towards its objects,
- Activities had not commenced due to pending government approvals, which in turn required 12AB registration,
- The CIT(E) mechanically relied on the JAO’s report without independent application of mind,
- No proper opportunity of hearing was granted before rejection.
Importantly, the Tribunal reiterated that non-commencement of activities cannot be the sole ground to reject registration, especially when “proposed activities” are genuine and substantiated, in line with Ananda Social & Educational Trust (SC) principles.
Accordingly, the ITAT set aside both rejection orders and restored the matter to CIT(E) with directions to:
- Re-examine the application independently,
- Consider evidence of preparatory activities,
- Grant proper opportunity of hearing.
The appeals were thus allowed for statistical purposes, reinforcing that genuineness and intent matter more than mere commencement of activities for 12AB/80G registration.
FULL TEXT OF THE ORDER OF ITAT BANGALORE
These are the two appeals filed by the assessee challenging the rejection orders of the Ld.CIT(E) in which the permanent registration sought for u/s. 12AB and the approval u/s. 80G were rejected by the Ld.CIT(E) vide his orders dated 19/03/2025 and 01/09/2025 and raised the following grounds with a delay of 109 days.
