Case Law Details
CIT Vs Sadhumargi Shantkranti Jain (Supreme Court of India)
Summary: The Supreme Court has agreed to re-examine whether registration under Section 12AA of the Income Tax Act automatically qualifies a trust for benefits under Section 80G. The case stems from a High Court ruling that held 12AA registration alone sufficient for granting 80G approval, leading to dismissal of the Commissioner’s appeal.
The Additional Solicitor General, Mr. Raghavendra P. Shankar, argued that while the respondent trust holds a 12AA certificate, this does not by itself entitle it to 80G benefits. He contended that the assessing authority must determine whether the trust’s activities are charitable or religious, asserting that the activities in this case were primarily religious rather than charitable.
The Supreme Court condoned the delay, issued notice returnable in four weeks, and permitted dasti service, thereby setting the stage for a detailed examination of the issue.
FULL TEXT OF THE SUPREME COURT JUDGMENT/ORDER
1. The High Court has taken the view that the registration of the Trust under Section 12-AA of the Income Tax Act, 1961 (for short, “the IT Act”) by itself is sufficient to grant the benefit under Section 80(G) of the IT Act.
2. Taking such a view, the appeal filed by the Commissioner came to be dismissed by the High Court.
3. Mr. Raghavendra P Shankar, the learned ASG would submit that it is not in dispute that the respondent-Trust has been issued a certificate under Section 12-AA of the IT Act but that by itself would not entitle the Trust to claim the benefit under Section 80-G of the IT, Act.
4. According to him, in a given case, the assessing authority may have to look into the nature of the transaction, whether it is charitable or religious.
5 According to the learned A.S.G., in the facts of the present case, the activity for which 80-G exemption was prayed for, was not for charitable in nature, but was predominantly a religious activity.
6. Delay condoned.
7. Issue notice returnable in four weeks.
8. Dasti service, in addition, is permitted.
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