Jamna Devi Shikshan Sansthan Vs CIT (Exemption) (ITAT Jaipur)
Enhanced Rent to Specified Persons Cannot, on Mere Assumption, Justify Denial of Section 12AB Registration: Jaipur ITAT
Jamna Devi Shikshan Sansthan, which runs an English-medium senior secondary school, was denied registration by the CIT(E) on the ground that the monthly rent paid to specified persons had increased from ₹70,000 to ₹1,00,000, allegedly attracting Sections 13(1)(c) and 13(3).
The Jaipur ITAT observed that the rent was enhanced after the construction and inclusion of the first and second floors, for which an amended lease deed had been executed. The society had furnished the lease documents, resolutions, area particulars, rent accounts and evidence of TDS deduction. The CIT(E), however, rejected the application without properly examining these materials or the additional area made available to the society.
Since the charitable objects and educational activities of the society were never disputed, the Tribunal held that benefit to specified persons could not be presumed merely from the increase in rent. Section 13(1)(c) could not be invoked on assumptions, without examining the complete facts and evidence. The CIT(E)’s order was set aside and registration sought through Form 10AB was directed to be granted.
FULL TEXT OF THE ORDER OF ITAT JAIPUR
