Kirti Mahal Satsang Bhawan Trust Vs CIT (Exemptions) (ITAT Lucknow)
Construction of Satsang Bhawan Is Charitable Activity — 12AB Registration & 80G Approval Directed to Be Granted
The Lucknow Bench of the ITAT allowed the assessee’s appeals and set aside the orders of the CIT (Exemptions), Lucknow, which had rejected the trust’s applications for registration under Section 12AB and approval under Section 80G(5) on the ground that no substantial charitable activity was being carried out.
The Tribunal accepted the assessee’s explanation that, due to limited funds, the trust primarily utilized contributions for the construction of a Satsang Bhawan, which was in furtherance of its stated charitable objects. The ITAT noted that the construction activity itself constituted a charitable activity, and that other charitable activities could not be undertaken at scale because of paucity of funds. It was also recorded that construction was completed and the trust had commenced charitable activities including Satsang.
Holding that the CIT (Exemptions) had adopted an unduly narrow view of charitable activity, the ITAT directed the authority to grant registration under Section 12AB and approve the application under Section 80G(5). Accordingly, both appeals were allowed on merits.
FULL TEXT OF THE ORDER OF ITAT LUCKNOW
(A) These two appeals have been filed by the assessee, against the impugned orders each dated 24/12/2024 passed by learned CIT (Exemptions), Lucknow under second proviso to sub-section 23C of section 10 and under section 80G(5) of the Income Tax Act, 1961 (“the Act” for short).
