ITAT Rajkot restores trust’s chance for registration under Section 12A due to improper hearing

Background of the dispute

The matter before the Income Tax Appellate Tribunal, Rajkot Bench, arose from an order passed by the Commissioner of Income Tax (Exemption), Ahmedabad [CIT(E)], dated 08.08.2025. By this order, the CIT(E) rejected an application for regular registration under Section 12A(1)(ac)(iii) of the Income Tax Act 1961 and treated the application as non-maintainable.

The assessee, Ramkrushna Sharda Sevashram, is a charitable trust that sought to challenge this rejection. The Tribunal was called upon to decide whether the denial of registration and the treatment of the application as non-maintainable were justified, particularly when the assessee asserted that it had not been given a fair opportunity to present its case.

Grounds of appeal before the Tribunal

The assessee raised multiple grounds contesting the order of the CIT(E). In essence, the grievance of the assessee trust was:

  • The CIT(E) wrongly refused the application for regular registration under Section 12A(1)(ac)(iii) on facts and in law.
  • The CIT(E) treated the application as non-maintainable without examining the merits.
  • The CIT(E) took the stand that, since an earlier application under Section 12A(1)(ac)(iii) was rejected and the provisional registration was cancelled, the fresh application itself could not be entertained.
  • Most importantly, the assessee contended that the order was passed without granting a proper and effective opportunity of being heard.

The assessee also reserved its right to modify, add, or withdraw any grounds at the time of hearing.

Constitution and objectives of the trust

The assessee trust was created on 11.01.2019. Its stated purposes are wide-ranging charitable objectives, which include:

  • Conducting educational and medical activities.
  • Imparting technical and computer education free of cost or at subsidised rates.
  • Supplying books, educational kits and other assistance to economically weaker students.
  • Providing medical relief to underprivileged and needy persons.
  • Extending relief to poor persons in various forms.
  • Organising and promoting activities relating to Indian art and culture.

These objects place the trust within the typical domain of entities seeking exemption under Section 11 and Section 12 upon registration under Section 12A.

Chronology of applications under Section 12A

Initial provisional registration

  1. The trust first applied for provisional registration under Section 12A for Assessment Year (AY) 2021-22 on 15.03.2021, vide Acknowledgment No. 290995070150321.
  2. The CIT(E) granted provisional registration under Section 12A from AY 2021-22 to AY 2023-24 by order dated 27.05.2021.

Second provisional registration due to bona fide error

  1. Subsequently, due to what was later claimed as a bona fide mistake, the trust again filed another application for provisional registration under Section 12A on 30.03.2022, vide Acknowledgment No. 482089280300322.
  2. On this second application, the CIT(E) again granted provisional registration under Section 12A from AY 2022-23 to AY 2024-25 by order dated 06.04.2022.