IN THE INCOME TAX APPELLATE TRIBUNAL “B” BENCH: BANGALORE BEFORE SHRI PRASHANT MAHARISHI, VICE PRESIDENT AND SHRI SOUNDARARAJAN K., JUDICIAL MEMBER ITA No.2006/Bang/2019 Assessment year: 2019-20 Vijayanagar Educational Trust, Vs. The Commissioner of Income Tax No.6, 2^nd Main, 9^th Cross, (Exemptions), Hampinagar, RPC Layout, Bangalore.

Bengaluru – 560 040.

PAN: AAATV 4152E APPELLANT RESPONDENT Appellant by : Shri Hariprasad Nayak, CA Respondent by : Shri Murali Mohan, CIT(DR)(ITAT), Bengaluru.

Date of hearing : 25.07.2025 Date of Pronouncement : 22.10.2025

O R D E R

Per Prashant Maharishi, Vice President

01. This appeal is filed by Vijayanagar Educational Trust (the 'assessee', 'appellant', 'Trust') for the assessment year 2019-20 against the order passed by the ld. Commissioner of Income Tax (Exemptions), Bengaluru [ld. CIT or CIT (E)] dated 13.08.2019 cancelling the registration granted to the trust w.e.f. AY 2015- 16 and directing the AO to invoke the provisions of section 115TD of the Income Tax Act, 1961 [the Act].

02. The assessee aggrieved with the same has preferred the following grounds:-

“ 1. That, in the facts and circumstances of the case, the order passed by Ld.CIT (Exemption) u/s 12AA (4) of IT Act 1961 dated

13/08/2019 is opposed to law and fact of the case.

2. That, in the facts and circumstance of the case, the Ld CIT(E) erred in cancellation of registration of the trust u/s 12AA(4) w.e.f 2015- 16 without bringing on record why and how the provision of section 12AA(4) can be invoked in order to cancel registration of the trust u/s

12A of IT Act 1961.

3. That, in the facts and circumstances of the case, Ld. CIT (E) erred in appreciating the fact that in order to invoke provision of section 12AA (4) of IT Act 1961, even though conditions of provisions are not fulfilled i.e. the object of the trust are not charitable in nature and its activities are not carried out in accordance with the object of the trust.

4. That, in the facts and circumstances of the case, the Ld. CIT(E) failed to appreciate the fact that in order to invoke section 12AA(4) of IT Act 1961, it is pre-condition for CIT(E) to prove that the activity of the trust are being carried out in manner that the provision of section 11 & 12 of IT Act 1961 do not apply to exclude either whole or any part of the income of such trust or institution due to operation of sub-section (1) of section 13 of IT Act 1961.

5. That, in the facts and circumstances of the case, the Ld.CIT(E) was erred in cancellation of registration of the trust u/s 12A(ab) of IT Act 1961, even though objects of the trust are charitable in nature and are being carried out its activities as per the object of the trust.

6. That, in the facts and circumstances of the case, the Ld.CIT (E) was erred in cancellation of the registration u/s 12AA (4) with retrospective effect from AY 2015-16.

7. That, in the facts and circumstances of the case, the Ld.CIT (E) was erred in not considering the objection filed by assessee where it was explained that there was reasonable cause for the activities to be carried out in said manner.

8. The appellant craves leave to amend or alter any grounds or add a new ground which may be necessary.”

03. The brief facts of the case show that assessee is a public charitable trust having the main object of imparting education by establishing schools & colleges. It has established and managing various colleges and schools since 1980 and has also got itself registered u/s. 12A of the Act vide order dated 12.1.1999.

04. The objects of the trusts are as under:-

“a. To start nursery, primary and high school and college in the medium of English, Kannada and Hindi in the State of Karnataka.

b. To open college, technical institute, training institute for training nursery, primary and high school teachers in the State of Karnataka. c. To open efficient library and reading rooms for free use of public.

d. To encourage sports activities to the boys and girls.

e. To encourage the fine arts and culture.

f.