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2023 (5) TMI 793 - AT - Income TaxRegistration u/s. 80G - according to the CIT(Exemption) that whatever educational activities are carried out, building constructed, funds invested in construction of building by the assessee are not protected and denied the registration u/s. 80G(5)(vi) - AR submitted that admittedly, the said land belongs to the four trustees and the assessee’s trust entered into lease agreement with the said trustees for 30 years - revenue contended that overall activity of construction of building as per the terms of the lease agreement direct benefit of the persons covered u/s. 13(3) of the Act which clearly violates the conditions mentioned u/s. 80G(5)(vi) HELD THAT:- We find force in the arguments of the ld. DR that the assessee will have no right whatsoever over the construction of building and its development, utilizing from the assessee’s trust fund. The assessee is also bound to vacate the said premises after the lease period. As brought to our notice that the CIT(Exemption) rejected the assessee’s application on two earlier occasions and this is the third application wherein the assessee has not made any efforts in modifying the lease deed as the case may be. As rightly pointed by the ld. DR if the registration u/s. 80G(5)(vi) of the Act is granted, the assessee is entitled to receive certain donations which are tax free being utilized for construction, development and the achievement of its objects etc. which goes to the hands of the lessors after the expiry of lease period of 30 years. We find there is no guarantee or protection given to the said tax free asset in the lease deed and will benefit the persons i.e. trustees covered u/s. 13(3) of the Act. Thus, we find no infirmity in the order of CIT(Exemption) and it is justified. Thus, the grounds raised by the assessee are dismissed.
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