2024 (6) TMI 1351 - AT - Income Tax

Rejecting the application for registration u/s 12A(1)(ac)(iii)- mismatch in name as per PAN database/Form No. 10AB vis- -vis Certificate of Registration PTR and audited accounts - HELD THAT - It was wholly erroneous on the part of the ld CIT(E) to reject the assessee s application on account of mismatch of name. The mismatch in name may be rectified and corrected and the corrected name may be accepted. It should not be a reason to deny registration of the assessee-trust. As Counsel submitted before us the correct name which is to be adopted as SURAT HALAI MEMON JAMAT AND HALAI MEMON JAMAT KABARSHATN . We have also noted that the assessee has already taken steps to correct the above name in the PAN database therefore above name should be treated as a correct name. Hence we direct the ld. CIT(E) to consider the above stated name of assessee-trust and registration should not be denied to the assessee - trust on this ground. So far objects and activities are concerned we note that assessee-trust is now ready to submit the entire list of objects and genuineness of its activities and these objects and activities may be verified by ld CIT(E). In these circumstances we are of the view that one more opportunity should be given to the assessee to plead its case and to explain all documents and evidences before ld CIT(E). Appeal is allowed for statistical purposes.

Summary

Issues:
1. Rejection of application for registration under section 12A(1)(ac)(iii) of the Income Tax Act due to a mismatch in the name of the trust.
2. Concerns regarding the genuineness of the activities and objects of the trust, specifically related to benefiting a particular religious community or caste.

Analysis:
1. The appeal was filed against the order of the Commissioner of Income Tax (Exemption) rejecting the application for registration under section 12A(1)(ac)(iii) due to a name mismatch. The applicant's name differed in various documents, leading to a show cause notice being issued. The applicant responded with proof of a name change request, but the correction was not reflected in the PAN database. The Tribunal found the rejection based on a name mismatch erroneous and directed acceptance of the corrected name, "SURAT HALAI MEMON JAMAT AND HALAI MEMON JAMAT KABARSHATN," as the correct name for registration purposes.

2. The rejection was also based on concerns regarding the genuineness of the trust's activities and objects, particularly benefiting a specific religious community. The Tribunal noted discrepancies between the trust's stated objects and actual activities, highlighting a potential violation of section 13(1)(b) of the Income Tax Act. However, the trust expressed readiness to provide complete documentation to clarify its objects and activities. The Tribunal directed the Commissioner to reevaluate the case, giving the trust an opportunity to present all relevant documents for a fresh adjudication. The appeal was allowed for statistical purposes, emphasizing the need for a thorough review of the trust's objects and activities to ensure compliance with the law.

In conclusion, the Tribunal addressed the issues of name mismatch and concerns about the trust's activities and objects in the appeal against the rejection of registration under section 12A(1)(ac)(iii) of the Income Tax Act. The Tribunal corrected the name mismatch and directed a reevaluation of the trust's objects and activities, emphasizing the importance of compliance with legal requirements for registration.