IN THE HIGH COURT OF GUJARAT AT AHMEDABAD R/TAX APPEAL NO. 291 of 2012 ==========================================================

CHIEF COMMISSIONER OF INCOME TAX (OSD) - RAJKOT Versus SUKHSAGAR EDUCATION & CHARITABLE TRUST ==========================================================

Appearance:

MAUNIL G YAJNIK(9346) for the Appellant(s) No. 1 MR B S SOPARKAR(6851) for the Opponent(s) No. 1 ==========================================================

CORAM:HONOURABLE MR. JUSTICE A.S. SUPEHIA and HONOURABLE MR. JUSTICE PRANAV TRIVEDI Date : 03/12/2025

ORAL ORDER

(PER : HONOURABLE MR. JUSTICE A.S. SUPEHIA)

1. At the outset learned advocates appearing for the respective parties have fairly submitted that the substantial question of law framed in the present tax appeal would get answered in view of the judgment passed by the Hon’ble Supreme Court in case of Ananda Social and Educational Trust Vs. Commissioner of Income Tax and Anr. Reported in (2020) 17 SCC 254 as well as the case of Commissioner of Income Tax (Exemptions) Vs. International Health Care Education and Research Institute reported in (2025) SCC Online SC 607.

2. In the present Tax Appeal, the appellant department has assailed the Judgment and Order dated 22.12.2011 passed by the Income Tax Appellate Tribunal, Rajkot in ITA No. 368/RJT/2011.

3. Pursuant to the order dated 11.12.2012, the Division Bench of this Court framed the following substantial question of law :-

“The Appeal is admitted for consideration of the following substantial question of law:

Whether the Appellate Tribunal is right in law and on facts in holding that the assessee trust was to be registered under Section 12AA of the I.T. Act and the CIT was not empowered to make any enquiry for establishing the genuineness of the assessee trust?”

To be heard with Tax Appeal No. 946 of 2011.”

4. The brief facts of the case are that Shri Sukhsagar Education & Charitable Trust, Rajkot has came into existence on 15.02.2008 by executing a trust deed. The trust deed was registered with the Charity Commissioner on 26.05.2008. The Trust filed an application Form no. 10A for registration under Section 12A of the Act on 09.03.2011. The registration was not granted stating that the Trust has not started any activity towards its main object “Education”. the Trust deposited Rs. 37,95,960/- in State Bank of India, Jamnagar, as per the direction of the Treasury Officer, Jamnagar towards purchase of land and Rs. 1,62,684/- towards transfer fee. This amount has flown from the five new Trustees as loan and who are residing at Chennai and belong to one and the same family. These trustees gave Rs.8,00,000/- each on 11.3.2011. As the said trustees are residing at Chennai, they would not be able to participate in carrying out the trust's charitable activities. As per Assessing Officer’s report the Trust has done some activities, but the same were sponsored by somebody else. The same are not reflected in the Trust's accounts. It is submitted by the Trust that they have distributed School Bags to the poor students and have donated Rs. 21,000/- to Sargam Club. Learned Senior Standing Counsel Mr. Yajnik has submitted that this is an afterthought as the same has taken place on 7.6.2011 when the Ward Inspector visited the Trust's Office and found that no activities are still carried out by the Trust and these amounts are also not appearing in the bank account.

5. At the time of filing the present Tax Appeal and framing of the substantial question of law, the appellant Department has placed reliance on the Judgment passed by the Kerala High Court in the case of Self Employers Service Society Vs. CIT reported in 247 ITR 18 (Kerala) and the Judgment passed by Karnataka High Court in the case of Sanjeevamma Hanumanthe Gowda Charitable Trust Vs. Director of Income Tax (Exemptions) in (2006) 155 Taxman 466 (Kar.) as well as the Judgment passed by Punjab and Haryana High Court in the case of Aman Shiv Mandir Trust Vs. CIT in (2007) 162 Taxmann 412, and conten