Sila for Change Foundation Vs CIT (Exemption) (ITAT Mumbai)
The Income Tax Appellate Tribunal (ITAT), Mumbai, dismissed the assessee’s appeals against the orders of the Commissioner of Income Tax (Exemptions), Mumbai, rejecting its applications for final registration under Section 12AB and approval under Section 80G. The assessee had been granted provisional registration on 1 October 2021 after filing Form 10A. While considering its subsequent application in Form 10AB for final registration, the Commissioner (Exemptions) examined the objects of the institution and found that one of the clauses authorised the assessee to provide support and developmental services to organisations in India as well as outside India in the social sector. Holding that this clause was not in conformity with the requirements of Section 11 and that the assessee had not established compliance with other applicable laws or the genuineness of the relevant activities, the Commissioner rejected the application for registration and, consequently, the application for approval under Section 80G.
Before the Tribunal, the assessee contended that provisional registration had already been granted and that its activities were genuine. It argued that the impugned object merely enabled coordination and support with organisations outside India and did not authorise charitable activities outside India. The assessee relied on several judicial precedents and submitted that no income had actually been applied outside India. The Revenue argued that the object permitting support to organisations outside India was contrary to the requirements of Section 11 and that the Commissioner was required to satisfy himself about the genuineness of activities and compliance with other laws before granting final registration.
