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July 31, 2019

CA. Paras K. Savla, CA. Hemant R. Shah

JUDICIAL PRONOUNCEMENTS
TRIBUNAL DECISIONS
Adesh Foundation (Regd.) vs. Commissioner of Income-tax (Exemptions), Chandigarh 105 taxmann.com 13 (Amritsar Trib.) [18/3/2019]

Section 80G approval can not be denied simply because there may be possibility of misuse of donations:

It is reported many a times that CIT Exemption deny the approval on the ground which are beyond the objectives of the IT Act.

Similarly, registration u/s. 12AA and approval u/s. 80G is also denied for the reason that it could be misused if registration or approval is granted.

This decision speaks about the scope of the powers of CIT while working on such application. It is expressely concluded that section 80G approval couldn’t be denied just because there may be possibility of misuse of donations.

Merely because assessee charitable educational institution was prosperous and failed to state as to why there was need for donations and it failed to submit list of proposed donors, approval under section 80(5)(vi) could not be denied merely upon possibility of misuse of donations.