Naughtys Pet Sanctuary Vs CIT (Exemption) (ITAT Cochin)
12A Registration allowed to Charitable Trust despite clause on remuneration to trustee : ITAT Cochin
Naughtys Pet Sanctuary Vs CIT(Exemption)- ITA No.543/Coch/2024 dt 24.04.2025
Naughty’s Pet Sanctuary is a public charitable trust registered in the state of Kerala & is committed to preservation of environment including watersheds, forests/wildlife & to animal welfare. Trust filed an application for final registration/ approval under section 12A in form 10AB. CIT(E)on verification of the documents as submitted by the assessee found that the trust deed of the assessee is having the following clause under the head “Powers of Trustees” which is violation of section 13(3):
“To receive honorarium or salary against his/her services or involvement in any of the project or programs run by the Trust, which must be decided by the Trustee & approved by the Board of Trustees.”
Assessee objected that section 13(3) can be pressed into play only at the time of assessment of income for each year & if in any previous year there is payment of salary to the specified person, the exemption can be denied only & only if payment of such salary is in excess of what may be reasonably paid for such services rendered by specified person. This provision cannot be pressed into play to decide the eligibility of registration filed in the form 10AB. Even if it is assumed that this provision can pressed into play, asseseee re-iterated that no salary has been paid to any trustee.
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