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Judgment
Per Renu Jauhri, Accountant Member:
The above captioned appeal is preferred by the assessee against the order dated 09.12.2025, passed by CIT(Exemptio n), Chandigarh u/s 12A(1)(ac)(ii) of the Income Tax Act, 1961 (hereinafter referred to as “the Act”) for A.Y. 2026-27.
The assessees has raised following grounds of appe al:
“1 . That the Ld. CIT Exemption, Chandi gar h has erred in facts and i n law in r ejec ting renewal of registrati on u/s 12AB read wit h secti on 12A(1)(ac)(ii), whic h is arbit rary , illegal and unsustai nabl e.
2.That t he Ld. C IT Exemption erred i n rej ec ting rene wal s ol ely o n the gr ound that c haritabl e expenses were incurred i n cas h wi thout any findi ng that s uch expenses are non-genui ne or not in accor dance with charitabl e o bjects .
3.That t he Ld. CIT Exemption failed to appreciate tha t i n abs enc e of any allega tion of misuse/diversion or violati on, r enewal could not hav e been refus ed.
4.That the L d. CIT Exemption faile d to appreciate the practical circumsta nce tha t temple and reli gio us activities in r ur al/semi-urban ar eas are depend ent upon ve ndors who deal only i n cas h.
5.That t he Ld. CIT Exemption failed to appreciate tha t i nstit uti onal bank acco unts of societies are operated under dual/collect ive signatures and banks gene rally do not extend U Pl/Googl e Pay facility to such i nstit uti onal acco unts, the only banking mode i s cheq ue, whic h rural ve ndors do not accept, maki ng cash expenditure unavoidabl e and bona fi de. R ejecti on based sol ely on cash is t herefor e untenable.
6.That mere mode of expenditure cannot form legal basis for refusi ng renewal , especially when ge nui neness and c haritable i nt ent are not doubt ed.
7.That t he rejection order is cont rary to t he set tled law laid down by Honorable S upreme Court i n A nanda Social & Educational Trust and by Honorable P &H Hi gh Court in S urya Educational & C har itable Trust tha t at rene wal sta ge, only genui neness a nd c haritabl e objects are to be exami ned.
8.It is therefore prayed that the impugne d order be quashed and renewal u/s 12AB be gra nted."”
Brief facts of the case are that the assessee trust filed an application for registratio n u/s 12A(1)(ac)(ii) on 20.08.2025. Ld. CIT(E) issued a notice seeking documents to establish the nature and genuineness of charitable activities. On perusal of reply filed by the assessee, ld. CIT(E) sought further information regarding multiple cash transactions from assessee's bank a/c and asked it to furnish documentary evidences to substantiate that the expenses w ere made for char itable activities. Since the documentary evidences and explanation file d by the asse ssee were not found to be satisfactory, ld. C IT(E) rejected the assessee's application vide order dated 09.12.2025. Aggrieved, the assessee is in appeal before the Tribunal.
At the outset, ld. AR submitted that the assessee is carrying out g enuine char itable activities and, therefore, another opportunity be allowed to furnish further evidences in this regard buy remanding the matter to ld. CIT(E). Ld . DR has not objected to the said proposition.
After hearing the rival submissions and perused the material on record, we deem it appropriate to restore the matter to ld. CIT(E) for fresh consideration of the application after giv ing due opportunity to the assessee.
In the result, appeal of the asse ssee is allo wed for statistical purposes.