ITAT Bangalore on Form 10AB Registration: Need for Proper Classification as Religious-Cum-Charitable Institution
Background of the Dispute
In Karnataka Samarpana Education Society Vs CIT (Exemptions) (ITAT Bangalore), the Bengaluru Bench of the Income Tax Appellate Tribunal examined an important procedural issue under Section 12AB of the Income Tax Act 1961: how a trust or society’s nature—whether charitable, religious, or religious-cum-charitable—should be recorded at the time of registration.
The case did not involve a denial of registration. Instead, the assessee society had already been granted registration, but challenged the manner in which its character was described in the registration order.
The assessee had applied for registration in Form 10AB on 29 September 2025. By order dated 17 January 2026, the CIT(E) granted registration under Section 12AB(1)(b) for Assessment Years 2027–28 to 2031–32. However, the registration certificate treated the assessee as a charitable institution only, while the assessee had sought recognition as a religious-cum-charitable society.
The core controversy before the Tribunal was thus restricted to the correct classification of the assessee’s nature in the registration order, not the eligibility for registration itself.
Grounds Raised by the Assessee
The assessee approached the ITAT with a focused set of grievances, essentially contending that the CIT(E) had failed to consider its asserted religious character. Summarised and rephrased, the key grounds were:
- The order dated 17 January 2026 under
Section 12AB(1)(b)was, according to the assessee, erroneous to the extent that it mischaracterised the trust as purely charitable. - In
Form 10AB, the assessee had clearly declared itself to be a religious-cum-charitable trust. This description, it argued, was consistent with:- its Trust Deed / Memorandum of Association,
- the note on activities filed before the
CIT(E), and - the supporting records and financial statements.
- The impugned order, while granting registration, did not record any adverse finding on:
- the existence of religious objects, or
- the conduct of religious activities.
- According to the assessee, the error lay not in any judicial assessment of ineligibility, but in an incorrect or incomplete processing of the record, leading to a wrong classification in the registration certificate.
- The assessee stressed that proper characterization as religious, charitable, or religious-cum-charitable is significant for the correct application of:
Sections 11and12(exemption provisions),Sections 12A/12AB(registration provisions), andSection 13(denial of exemption in specified situations).
On this basis, the assessee requested that the ITAT direct appropriate modification so that the registration reflects it as a religious-cum-charitable trust.
Hearing Before the Tribunal
The Bench heard:
- For the assessee: Shri Joe James, Chartered Accountant
- For the Revenue: Shri Arvind Kumar Singh, Commissioner of Income Tax
Both sides addressed the limited issue of how the assessee’s activities and objects should be classified for the purposes of Section 12AB registration.
Issue Framed by the ITAT
The Tribunal narrowed the controversy to a single point:
Whether, on the facts and material on record, the assessee society ought to be recognised and registered as a religious-cum-charitable institution, rather than only as a charitable trust, under
Section 12AB.
In other words, the Tribunal was not revisiting the grant of registration itself. The specific question was whether the description of the assessee’s nature in the registration certificate was properly determined after due appreciation of its objects and activities.
Examination of the Assessee’s Objects and Activities
Memorandum of Association and Primary Objects
The ITAT went through the assessee’s Memorandum of Association, with particular emphasis on its governing objects. It recorded that:
- The first object of the assessee is:
- “to take charge of and manage the temporal affairs of the Oblates of St.