Gujarat High Court
Commissioner Of Income Tax (Exemption) vs Anjuman E Nusratul Muslimin Tankaria on 15 April, 2026
Author: A.S. Supehia
Bench: A.S. Supehia
NEUTRAL CITATION
C/TAXAP/1052/2024 ORDER DATED: 15/04/2026
undefined
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/TAX APPEAL NO. 1052 of 2024
==========================================================
COMMISSIONER OF INCOME TAX (EXEMPTION)
Versus
ANJUMAN E NUSRATUL MUSLIMIN TANKARIA
==========================================================
Appearance:
MR AMAN MIR(10881) for the Appellant(s) No. 1
==========================================================
CORAM:HONOURABLE MR. JUSTICE A.S. SUPEHIA
and
HONOURABLE MR. JUSTICE PRANAV TRIVEDI
Date : 15/04/2026
ORAL ORDER
(PER : HONOURABLE MR. JUSTICE PRANAV TRIVEDI)
1. This Tax Appeal is preferred under Section 260A of the Income Tax Act, 1961 (hereinafter referred to as 'the Act' for short) proposing the following substantial question of law arising out of the order dated 24.04.2024 of the Income Tax Appellate Tribunal passed in ITA No.59/Ahd/2023 "i. Whether the facts and in the circumstances of the case and law, the Hon'ble Tribunal has erred while interpreting the decision of the Hon'ble Supreme Court in the case of Dawoodi Bohara Jamat 43 Taxmann.com 243 and holding that section 13(1)(b) cannot be applied for denying the grant of registration under Section 12AB of the Income Tax Act, 1961 despite the fact that the assessee trust is not created for the benefit of general public but one of its object clause is for the benefit of a particular religious community? ii. Whether on the facts and in the circumstances of the case and law, the Hon'ble Tribunal has erred in ignoring the recent amendments in Income Tax Act wherein a new procedure of Page 1 of 6 Uploaded by SAJ GEORGE(HC01069) on Mon Apr 20 2026 Downloaded on : Mon Apr 20 20:51:15 IST 2026 NEUTRAL CITATION C/TAXAP/1052/2024 ORDER DATED: 15/04/2026 undefined registration under section 12AB of Income Tax Act, 1961, has been inserted and whereby as per clause (d) of explanation to sub- section (4) of section 12AB of Income Tax Act, application of income for the benefit of any particular religious community has been listed as a specific violation for cancellation of registration of trust?
2. Brief facts of the case are as under.
2.1 The respondent assessee had filed an application seeking registration of the Trust under section 12AB of the Act on 15.06.2022 in form No.10AB under Rule 17A of the Income Tax Rules, 1962. The Commissioner of Income-Tax (Exemption), Ahmedabad after issuing notice to the respondent assessee seeking necessary information held that the assessee was not entitled to exemption in terms of Section 13(1)(b) of the Act, and therefore, denied the respondent assessee grant of registration under Section 12A of the Act.
3. Being aggrieved by the order passed by the Commissioner of Income Tax (Exemption), the respondent assessee preferred an appeal before the Income Tax Appellate Tribunal, Ahmedabad (hereinafter referred to as 'Tribunal' for short). The appeal came to be numbered as ITA No. 59/Ahd/2023. The Tribunal vide order dated 24.04.2023, allowed the appeal of the respondent assessee and restored the file before the Commissioner of Income Tax Page 2 of 6 Uploaded by SAJ GEORGE(HC01069) on Mon Apr 20 2026 Downloaded on : Mon Apr 20 20:51:15 IST 2026 NEUTRAL CITATION C/TAXAP/1052/2024 ORDER DATED: 15/04/2026 undefined (Exemption), which has led to filing of the present Tax Appeal.
4. Mr. Aman Mir, learned Senior Standing Counsel has categorically submitted that this issue is no more res-integra and covered by the decision of the Hon'ble Supreme Court in the case of CIT v. Dawoodi Bohara Jamat, reported in [2014] 43 taxmann.com 243 (SC), which has been followed by the Tribunal itself in various decisions. The learned Tribunal has categorically observed, at page-26 of the paper-book, as under:
"6. We have heard the rival contentions and perused the material on record. We observe that in the case of Jamiatul Banaat Tankaria 160 taxmann.com 358 (Ahmedabad - Trib.), the ITAT held that where objects of assessee-trust were primarily charitable rather than favouring any specific religious community, CIT(E) was not justified in denying registration under Section 12A, by invoking Section 13(1)(b) as said provisions would be attracted only at time of assessment and not at time of grant of registration. In the case of Malik Hasmullah Islamic Educational and Welfare Society 24 taxmann.com 93 (Luck.), the ITAT held that since provisions of Sections 11, 12 and 13 are intended for exercise of jurisdiction by an Assessing Officer in an assessment proceedings, Commissioner is not competent to invoke such provisions for purpose of declining registration under Section 12AA. In the case of St. Joseph Academy 50 taxmann.com 216 (Hyderabad - Trib.), the ITAT held that provisions of Section 13 can be invoked by for Assessing Officer while framing assessment and not by Commissioner while considering application registration under Section 12AA. In the case of Dawoodi Bohara Jamat 43 taxmann.com 243 (SC), the Page 3 of 6 Uploaded by SAJ GEORGE(HC01069) on Mon Apr 20 2026 Downloaded on : Mon Apr 20 20:51:15 IST 2026 NEUTRAL CITATION C/TAXAP/1052/2024 ORDER DATED: 15/04/2026 undefined Hon'ble Supreme Court made the following observations:
"40. Further, establishment of Madarsa institutions to impart religious education to the masses would qualify as a charitable purpose qualifying under the head of education under the provisions of Section 2(15) of the Act. The institutions established to spread religious awareness by means of education though established to promote and further religious thought could not be restricted to religious purposes. The House of Lords in Barralet v. IR 54 TC 446, has observed that "the study and dissemination of ethical principles and the cultivation of rational religious sentiment" would fall in the category of educational purposes. The Madarsa as a Mohommedan institution of teaching does not confine instruction to only dissipation of religious teachings but also contributes to the holistic education of an individual. Therefore, it cannot be said that the object (d) would embody a restrictive purpose of religious activities only. Similarly, assistance by the respondent-trust to the needy and poor for religious activities would not divest the trust of its altruist character.
41. Therefore, the objects of the trust exhibit the dual tenor of religious and charitable purposes and activities. Section 11 of the Act shelters such trust with composite objects to claim exemption from tax as a religious and charitable trust subject to provisions of Section 13. The activities of the trust under such objects would therefore be entitled to exemption accordingly.
42. We would now proceed to examine the objects under the provisions of Section 13(1)(b) of the Act. It becomes amply clear from the language employed in the provisions that Section 13 is in the nature of an exemption from applicability of Sections 11 or 12 Page 4 of 6 Uploaded by SAJ GEORGE(HC01069) on Mon Apr 20 2026 Downloaded on : Mon Apr 20 20:51:15 IST 2026 NEUTRAL CITATION C/TAXAP/1052/2024 ORDER DATED: 15/04/2026 undefined and the examination of its applicability would only arise at the stage of claim under Sections 11 or 12. Thus, where the income of a trust is eligible for exemption under Section 11, the eligibility for claiming exemption ought to be tested on the touchstone of the provisions of Section 13. In the instant case, it being established that the respondent-trust is a public charitable and religious trust eligible for claiming exemption under Section 11, it becomes relevant to test it on the anvil of Section 13.
7. In view of the above judicial precedents, looking into the facts of the instant case, we are of the considered view that the provisions of Section 13 of the Act can be invoked only at the time of assessment and not at the time of grant of registration under Section 12A of the Act. Our view is further supported by the decision of the Hon'ble jurisdictional High Court in the case of CIT (Exemptions) v. Bayath Kutchhi Dasha Oswal Jain Mahajan Trust [2016] 74 taxmann.com 199/243 Taxman 60 (Guj.)/[2017] 8 ITR-OL 494 (Guj.) wherein on the issue of denial of grant of registration u/s 12A of the Act by invoking Section 13(1)(b) of the Act, it was categorically held that the provisions of Section 13 would be attracted only at the time of assessment and not at the time of grant of registration. The relevant finding of the Hon'ble High Court at para 8 of his order is as under:
"8. Thus, very premise for the Commissioner to come to the conclusion that the objects of the trust were confined for the benefit of a religious community, is incorrect. Thereafter to suggest that the activities were carried out only for such purposes would be entering in the realm of granting exemptions in terms of Section 13 of the Act, which would be the task of the Assessing Officer to be undertaken at the time of assessment on the basis of material that may be brought on record."Page 5 of 6 Uploaded by SAJ GEORGE(HC01069) on Mon Apr 20 2026 Downloaded on : Mon Apr 20 20:51:15 IST 2026
NEUTRAL CITATION C/TAXAP/1052/2024 ORDER DATED: 15/04/2026 undefined
5. Therefore, even in the submissions of learned Senior Standing Counsel Mr. Aman Mir, the issue is squarely covered by the decision of CIT v. Dawoodi Bohara Jamat (supra) and has submitted that as per the provision of Section 13 of the Act, the issue can be invoked by Assessing Officer while framing assessment and not by Commissioner while considering the application for registration under Section 12AA of the Act.
6. In view of the above facts, we are of the opinion that no question of law, much less, any substantial question of law can be said to have arisen from the impugned order passed by the Tribunal. Therefore, the Tax Appeal deserves to be rejected and accordingly, dismissed. No order as to costs.
(A. S. SUPEHIA, J) (PRANAV TRIVEDI,J) SAJ GEORGE/20 Page 6 of 6 Uploaded by SAJ GEORGE(HC01069) on Mon Apr 20 2026 Downloaded on : Mon Apr 20 20:51:15 IST 2026