National Health & Education Society Vs CIT (Exmp) (ITAT Mumbai)
Summary: The Income Tax Appellate Tribunal, Mumbai Bench, considered two connected appeals filed by National Health & Education Society against separate orders dated 30.03.2026 passed by the Commissioner of Income Tax (Exemptions), Mumbai. ITA No. 4201/Mum/2026 challenged rejection of the Society’s application for continuation of registration under section 12AB and retrospective cancellation of the registration earlier granted; ITA No. 4200/Mum/2026 challenged the consequential rejection of approval under section 80G. The Tribunal heard both appeals together because they arose from common proceedings and substantially overlapping issues.
The Society was established in 1954, registered under the Societies Registration Act, 1860 on 13.04.1954 and as a Public Charitable Trust under the Bombay Public Trusts Act, 1950 on 11.07.1956. It administers P.D. Hinduja National Hospital and Medical Research Centre and has long pursued medical relief, medical education, scientific research and allied charitable activities. Its charitable status had been recognised under the Income-tax Act since section 12A registration was granted on 20.11.1974. Following the Finance Act, 2020 transition to the section 12AB regime, registration and section 80G approval were granted on 24.09.2021. Fresh applications were filed on 27.09.2025.
The CIT(E) rejected continuation of registration on three principal grounds: reimbursement of doctors’ expenditure for international conferences and training was treated as application of income outside India under section 11(1)(c); the Society was considered not to have satisfactorily established compliance with section 41AA of the Maharashtra Public Trusts Act and the Indigent Patients Fund Scheme; and the hospital’s tariffs, receipts, operational surplus and financial indicators were treated as evidence that it operated on commercial lines with a predominant profit motive. The registration was cancelled retrospectively from 24.09.2021, and the section 80G application was rejected consequentially.
