The Income Tax Appellate Tribunal, Pune denied the Assessee’s Exemption Claim under Section 80G due to lack of supporting evidence.


The solitary grievance of the assessee in this appeal is the denial of exemption u/sec. 80G of the Income Tax Act, 1961.


The division bench of R.S. Syal, Vice President And Partha Sarathi Chaudhury, Judicial Member noted that in order to identify the genuineness of the activities and how the fund of the applicant-trust is being utilized, various details were called for from the assessee by the office of CIT(E).  

The Tribunal observed that while granting exemption u/sec. 80G of the Act, it is incumbent upon the competent authority i.e. ld. CIT(E) to draw a satisfactory conclusion about the genuineness of the activities of the assessee and fulfillment of conditions laid down in clauses (i) to (v) of sec. 80G(5) of the Act. Since the assessee did not respond to the notice and since those discrepancies as pointed out by the Department were not resolved by the assessee, therefore, exemption application was rejected

“The law is very clear that only when the ld. CIT(E) is satisfied that the applicant trust is legally eligible to be granted exemption u/sec. 80G of the Act, only then, such exemption can be granted and for this, the assessee has to establish that its activities are genuine and the funds utilized are in accordance with the provisions of the said section and as per the object of the trust”, the Tribunal said.

The bench observed that the Revenue always has the power to deny the exemption under the relevant provision if the assessee does not fulfill/satisfy with the requirements of the provision, however, reasonable opportunity has to be accorded to the assessee in order to furnish all the details and suppose if assessee has not complied with the notices before the CIT(E), then it has to be seen whether the assessee has failed the test of reasonableness in not complying with the notice of the Department.

It was stated by the Tribunal that the fact of the matter is that the necessary details required especially with regard to the discrepancies pointed out by the Department have not been clarified through supporting evidences by the assessee and in effect only two opportunities were given to the assessee. 

The bench viewed that it is prudent and judicious to remand the matter to the file of CIT(E) for denovo adjudication as per law complying with the principles of natural justice.

Case title: CPRS Rugnalay Denagi Samiti, CPR College v/s CIT (Exemption)

Citation: ITA No.715/PUN/2023

Amit Sharma

Author of Tax Concept

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