IN THE INCOME TAX APPELLATE TRIBUNAL “B’’ BENCH: BANGALORE BEFORE SHRI PRASHANT MAHARISHI, VICE PRESIDENT AND SHRI KESHAV DUBEY, JUDICIAL MEMBER ITA No.714/Bang/2025 Assessment Year : 2025-26 Shri Kurunji Education Trust (R)

Shrirampet Sullia Dakshina Kannada CIT (Exemptions)

Vs.

Karnataka 574 239 Bengaluru PAN NO : AADTS2189K APPELLANT RESPONDENT Appellant by : Dr. Sheetal Borker, A.R.

Respondent by : Sri Subramanian, JCIT D.R.

Date of Hearing : 09.12.2025 Date of Pronouncement : 25.02.2026

O R D E R

PER KESHAV DUBEY, JUDICIAL MEMBER:

This Appeal at the instance of the assessee is directed against the order of ld. CIT(Exemptions) dated 27.2.2025 vide DIN and Notice No: ITBA/EXM/F/EXM45/2024-25/1073775752(1) rejecting the application filed for approval u/s 80G of the Income Tax Act, 1961 (in short “The Act”).

2. The assessee has raised the following Grounds of appeal:-

3. Brief facts of the case are that the assessee trust is registered under sub-clause (i) of clause (ac) of sub-section (1) of section 12A of the Act vide Unique Registration No. (URN)-AADTS2189KE20213 dated 4.4.2022 from AY 2022-23 to AY 2026-27. Further, the assessee trust had been granted provisional approval vide Unique Registration No.(URN)- AADTS2189KF20229 dated 4.4.2022 under clause (iv) of first proviso to sub-section (5) of section 80G of the Act from 4.4.2022 to AY 2024-25 in form No.10AC by the ld. PCIT/CIT. The assessee trust thereafter applied for permanent approval as per the clause (iii) of first proviso to sub-section (5) of section 80G of the Act in form no.10AB on 10.8.2024.

3.1 The ld. CIT (Exemption), Bengaluru after granting opportunity of being heard rejected the approval u/s 80G of the Act on the following grounds:-

1. There is substantial increase in income over expenditure for an entity established for the purpose of charitable activities, which indicate that:

i. The assessee is not able to apply the resources at the hand towards the charitable objects.

ii. The profit motive of the entity which does not augur well with the charitable motive as per the object of the trust.

2. The private institutions are well funded by high fee receipts and management fee which undergoes an increase every year does not commensurately passed on in terms of tangible or intangible facilities.

3. The receipts in the form of “fees collections” do not fall under the definition of donations and therefore, provisions of section 80G of the Act are not found applicable in the present case. The provisions of section 80G of the Act are applicable in case of receipts in the form of donations to certain funds as defined in section 80G(2) of the Act.

4. It is the Government aided schools/colleges/institutions and other institution operating in remote areas with little or no infrastructure which deserves the benefit of section 80G of the Act.

5. The donations received u/s 80G of the Act are required to be reported in Form 10BD followed by issue of Form 10BE to the donors. Had the intent of the legislature been to include all kinds of receipts including fee receipts u/s 80G of the Act, the reporting of receipts would not have been restricted to donations alone.

3.2 In view of the above, the ld. CIT(A) held that the fee receipts do not fall under the purview of receipts u/s 80G of the Act and accordingly held that approval u/s 80G of the Act cannot be granted in the present case. In view of the above, the application filed by the assessee trust in form 10AB dated 10.8.2024 for approval u/s 80G of the Act was rejected and accordingly approval was cancelled by the ld. CIT(Exemption) vide order in Form No.10AD dated 27.2.2025.

4. Aggrieved by the order of ld. CIT(Exemption), Bengaluru dated 27.2.2025, the assessee has filed the present appeal before this Tribunal. The assessee has also filed the paper book comprising 9 pages containing therein the copy of provisional approval u/s 80G of the Act, copy of order of registration u/s 12AB of the Act along with the details of submissions made befor