Jamiatul Banaat Tankaria Vs CIT (Exemption) (ITAT Ahmedabad)
Income Tax Appellate Tribunal (ITAT) Ahmedabad has overturned an order by the Commissioner of Income-tax (Exemption) [CIT(Exemption)] that denied registration under Section 12AB of the Income-tax Act, 1961, to Jamiatul Banaat Tankaria. The Tribunal’s decision, pronounced on March 6, 2024, clarified the application of Section 13(1)(b) of the Act, emphasizing that it pertains to the grant of exemption under Section 11, not the initial registration under Section 12A/12AB.
Jamiatul Banaat Tankaria, an established trust with existing registrations under Section 12A and 80G, had applied for registration under the new Section 12AB. The CIT(Exemption) rejected this application, asserting that the trust’s objects were primarily for the benefit of a specific religious community, “Muslims,” thereby attracting Section 13(1)(b) of the Act and disqualifying it from exemption under Section 11. The CIT(Exemption) specifically cited object number 6 of the trust deed, which provides scholarships to Muslim students for their studies and religious education, as evidence of this restriction. The rejection order cited the Supreme Court’s decision in CIT Vs. Dawoodi Bohara Jamat.
The assessee appealed the CIT(Exemption)’s decision, presenting several grounds. Firstly, the assessee argued that the order was void as it was not passed within 15 days of the last hearing, citing CBDT Circular No. 279/Misc 53/2003-ITJ dated June 19, 2015, and Instruction No. 20/2003 dated December 23, 2003.
