Shree Rajput Sabha vs. The Commissioner of Income Tax, Exemption, Jaipur

Parties Involved

Facts Summary

The assessee, Shree Rajput Sabha, filed an application for registration under section 80G of the Income Tax Act, 1961. During the proceedings, it was found that the assessee was engaged in activities such as running a coaching institute and guest houses, which were considered commercial in nature and not charitable. A show cause notice was issued under section 12AA(3) & 12AA(4) of the Act, and the assessee responded by contending that its activities were charitable. The Commissioner of Income Tax (Exemption) found that the assessee was running a coaching institute and guest houses on commercial lines, leading to the cancellation of its registration under section 12AA(3) & 12AA(4) of the Act. The assessee appealed against this order, arguing that the activities were charitable and in accordance with its objects.…

Legal Issues

• 1. Whether the activities of the assessee are non-genuine or not in accordance with the objects of the trust.
• 2. Whether the assessee is carrying on activities in the nature of trade, commerce, or business.
• 3. Whether the surplus generated by the assessee exceeds 20% of its total receipts.

Judgment Outcome

Decided in favour of Assessee.

Precedents Relied Upon

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