Fire Safety Certificate Not a Valid Ground to Deny Charitable Trust Registration Under Section 12AB: ITAT Bangalore

Overview of the Case

In a significant ruling that offers relief to charitable institutions operating old-age homes and similar welfare facilities, the Income Tax Appellate Tribunal, Bangalore, set aside an order passed by the Commissioner of Income Tax (Exemptions) [CIT(E)] that had rejected an application for renewal of registration under Section 12AB of the Income Tax Act, 1961. The case involved Aradhana Senior Citizen Caring Center, a public charitable trust running a no-profit old-age home, and the Tribunal's decision underscores several important principles regarding procedural fairness and the valid grounds for denying charitable registration.

Background: The Trust and Its Registration History

Aradhana Senior Citizen Caring Center was established in 2019 as a public charitable trust, operating an old-age home on a strictly non-profit basis. The trust followed the standard registration pathway under the Income Tax Act, 1961:

  • It was initially granted provisional registration under Section 12A, effective from Assessment Year 2021-22.
  • Thereafter, final registration under Section 12AB was granted on 02.12.2022, valid through Assessment Year 2025-26.
  • This final registration remained active and valid as on the date of the impugned order.

With the registration approaching its expiry, the trust filed an application in Form 10AB on 5.3.2025, seeking renewal. Alongside the application, the trust also submitted a petition requesting condonation of a delay of 157 days in filing the renewal application.

The CIT(E) Proceedings: A Series of Notices and Responses

What followed was a series of procedural events that ultimately formed the crux of the dispute before the ITAT.

Conflicting Notices Issued Simultaneously

On 28.7.2025, the CIT(E) issued a show cause notice directing the trust to appear in Bangalore on 5.8.2025. Remarkably, on the very same day, another notice was issued requiring the assessee to appear at the Mangalore Office — two different locations, two notices, issued simultaneously. Despite this administrative anomaly, the trust:

  1. Submitted its reply online in response to the Bangalore notice.
  2. Physically furnished documents at the Mangalore Office on 7.8.2025.

Personal Appearance and Handwritten Show Cause Notice

A subsequent notice was issued on 9.8.2025, following which the assessee appeared in person on 14.8.2025 before the CIT(E) with all relevant documents. During this hearing, the CIT(E) issued a handwritten show cause notice raising two specific concerns:

  • Cash transactions recorded in the trust's accounts
  • Absence of a fire safety certificate

In response, the assessee filed a detailed online reply on 25.8.2025, accompanied by supporting documents addressing both issues raised.

The Rejection Order