TMI Blog2020 (1) TMI 1017X X X X Extracts X X X X X X X X Extracts X X X X ..... itable objects is doubtful. Also see ESCORTS SKILL DEVELOPMENT VERSUS CIT (EXEMPTIONS) , CHANDIGARH [ 2019 (5) TMI 770 - ITAT DELHI] - Decided in favour of assessee. - I. T. A. No. 182/Chd/ 2019. - - - Dated:- 20-12-2019 - N. K. Saini Vice-President And Sanjay Garg Judicial Member For the Assessee : Sudhir Sehgal , Advocate For the Department : G. S. Phani Kishore , Commissioner of Income-tax-Departmental representative ORDER SANJAY GARG (JUDICIAL MEMBER). - 1. The present appeal has been preferred by the assessee against the order dated January 30, 2019 of the Commissioner of Income-tax (Exemptions), Chandigarh (hereinafter referred to as the CIT(E) ) contesting the denial of approval under section 80G(5)(vi) of the Income-tax Act, 1961 (in short the Act ) to the appellant-society. 2. The brief facts relating to the case are that the assessee-company has already been registered as a charitable institution under section 12A of the Act. It had filed an application on July 31, 2018 with the learned Commissioner of Income-tax (Exemptions) for also granting approval ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... expenses incurred on corporate social responsibility that is compulsory to be spent. In this case seeking approval under section 80G is such an arrangement that would help to redeem its group companies corpo rate social responsibility obligations. It is reiterated that the benefit of approval for exemption to donations cannot be extended to an entity that is part of an arrangement that allows corporates to claim deduc tion on an amount that is otherwise not allowable as deduction from income (as expenditure) as per the Finance (No. 2) Act, 2014. It is also pertinent to mention that the activities of the company has brought out in the preceding paras clearly shows that the company is not pursuing charitable activities and hence the certificate of exemption under section 12AA is also need to be examined and reviewed. The Assessing officer is also asked to examine the claims of the company under section 12AA. In the light of the above, I have no option but to reject the application under section 80G(5) of the Income-tax Act. 3. Being aggrieved by the above order of the Commissioner of Income-tax (Exemptions), the assessee has come in appeal before us. 4. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (ii) the instrument under which the institution or fund is consti tuted does not, or the rules governing the institution or fund do not, contain any provision for the transfer or application at any time of the whole or any part of the income or assets of the institution or fund for any purpose other than a charitable purpose ; (iii) the institution or fund is not expressed to be for the benefit of any particular religious community or caste ; (iv) the institution or fund maintains regular accounts of its receipts and expenditure ; (v) the institution or fund is either constituted as a public charitable trust or is registered under the Societies Registration Act, 1860 (21 of 1860), or under any law corresponding to that Act in force in any part of India or under section 25 of the Companies Act, 1956 (1 of 1956), or is a university established by law, or is any other educational institution recognised by the Government or by a university established by law, or affiliated to any university estab lished by law, or is an institution financed wholly or in part by the Government or a local authority ; (vi) in relation to donation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... per se be the reasons for denying registration under section 12AA of the Income-tax Act. As regards the reasons (iii) given by the Commissioner of Income-tax (Exemptions) that the object of trust are to be noted whereby apart from the corporate social responsibility activities, the activities in the nature of eradicating hunger and poverty, promotion of education, promoting gender equality, etc., are also provided. These activities are in the nature of public charity. Further, the corporate social respon sibility activities itself are in the nature of public charitable activities. As regards the reasons (iv) given by the Commissioner of Income-tax (Exemptions), no activities in sync with the requirement of the Companies Act has taken place in the trust so far. For the purpose of granting registration under section 12AA only two factors are to be seen by the Commissioner of Income-tax (Exemptions) which are the objects of the trust being charitable in nature and the genuineness of activities. There is no requirement to see where the activities are in sync with the Companies Act or not. Reasons (v) given by the Commissioner of Income-tax (Exemptions) that the activiti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e in the present case. The case law relied on by the learned Departmental represent ative are not applicable as the factual matrix in those cases are totally different. Thus, the order passed under section 12AA and under section 80G(5)(vi) of the Income-tax Act, 1961 are set aside. We direct the Commissioner of Income-tax to grant the registration under section 12AA of the Act and also the approval under section 80G(5)(vi) of the Act to the assessee. 10. In the result, both the appeals of the assessee are allowed. 6. Identical issue has been further decided by another co-ordinate Delhi Bench of the Tribunal in favour of the assessee in the case of Escorts Skill Development v. CIT (E) in I. T. A. Nos. 527 and 528/Delhi/2017 vide order dated April 26, 2019 and further in the recent decision of this Bench of the Tribunal in the case of Roundglass Foundation v. CIT (E) I. T. A. No. 181/ Chd/2019- [2020] 77 ITR (Trib) 288 (Chand), wherein, vide order of even date this issue has been decided in favour of the assessee. 7. In view of this, the impugned order of the learned Commissioner of Income-tax (Exemptions) is set aside. The learned Commis ..... X X X X Extracts X X X X X X X X Extracts X X X X
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