Self-certified copies of documents sufficient for exemption under section 12AA of the Income Tax Act: ITAT

Self-certified copies of documents sufficient for exemption under section 12AA of the Income Tax Act: ITAT

Self-certified copies of documents are sufficient for the purpose of claiming exemption under section 12AA of the Income Tax Act, as held by the Jaipur Bench of the Income Tax Appellate Tribunal (ITAT) .

The two-member bench of Dr. S. Seethalakshmi (Judicial Member) and Rathod Kamlesh Jayantbhai (Accountant Member) have observed that CIT(E) has erroneously passed the order without considering that the assessee has submitted all the necessary documents which were raised in the form of queries.

The assessee is a charitable society, established long ago and engaged in promoting the nationality, education, and personality development of the students without any discrimination of caste, creed, or sex.

The assessee had filed an online application on 06.02.2020 on Form No. 10A for seeking registration under section 12AA of the Income Tax Act, 1961. The assessee was issued a notice dated 14.07.2020 requesting to submit certain documents and to produce the original RC/MOA for verification.

In its order, the CIT(E) assumed that in accordance with Rule 17A read with section 12AA(1)(b), the original instrument establishing the trust and other evidence was not filed in the original. The CIT (E) is empowered to call for documents and information to satisfy himself with the genuineness of the activities or to make necessary enquiries.

The assessee submitted that, under Rule 17A, there is no necessity to produce the original and self-certified copy of the instrument and establish the institution for verification. The pre-amended Rules 17A, which stood prior to the newly substituted Rule 17A by the Income Tax Rules, 2018 w.e.f. 19.04.2018. The application seeking registration was filed on 06.02.2020. Hence, the amended Rules 17A are applicable to the application for registration of a charitable trust. The trust was created under an instrument. A self-attested or self-certified copy of the document evidencing the creation of the trust is essential as per Rules 17A. A self-attested or self-certified copy of each and every document/instrument will be sufficient for seeking registration.

The assessee submitted that CIT(E) has erred in understanding, contrary to the specific provisions of rules and law which are relevant for the present case. All the self-certified copies that are sufficient for the registration were submitted.

The assessee submitted that self-attested copies of the main objects and amended objects were submitted along with the application, which are certified copies of both documents obtained from Devstan Vibhag, Rajasthan, and were also duly produced before the CIT(E) as soon as it was received on 22.09.2020. The CIT(E) has completely ignored the submission made by the assessee where all the conditions were fulfilled whenever the CIT(E) raised voluminous queries and all of them were duly replied to from time to time.

The tribunal held that the CIT(E) is factually incorrect and unjustifiable where the CIT(E) has failed to observe that the activities carried out by the trust were genuine in nature.

"We observed that the assessee carried out charitable activities in accordance with the law with the main objects and amended objects of the trust deed," the ITAT noted.

The court held that, as per amended Rule 17A of the Income Tax Rules, the assessee was not required to produce any original copy of the documents, but a self-certified copy or instrument was sufficient for the purpose of verification by the CIT(E).