Commissioner wrongly denied Section 80-G exemption renewal for society with valid Section 12A registration.

The tribunal held that the Commissioner of Income-tax wrongly denied the renewal of exemption under Section 80-G for a society, as its registration under Section 12A was valid. The tribunal emphasized that the denial during the subsistence of Section 12A registration was incorrect, citing a similar precedent. The appeal was allowed, directing the Commissioner to grant the renewal of exemption.

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Issues Involved:
1. Whether the activity of the society falls under "advancement of any other object of general public utility" or "education".
2. Whether the application for renewal of exemption under Section 80-G should be granted during the subsistence of registration under Section 12A.

Issue-wise Detailed Analysis:

1. Classification of Society's Activity:
The primary issue was whether the activities of the society were for the "advancement of any other object of general public utility" or solely for "education." The Commissioner of Income-tax (CIT) denied the renewal of exemption under Section 80-G, referencing the society's objectives listed in the impugned order. The CIT argued that these objectives did not fall within the meaning of "education" or "advancement of other objects of general public utility." Additionally, the CIT cited the amendment to Section 2(15) of the IT Act, 1961, effective from 1.4.2009, which excludes activities involving trade, commerce, or business from being considered charitable purposes. The society's inability to amend its objectives due to an ongoing dispute in the High Court of Punjab & Haryana was also noted.

2. Denial of Renewal of Exemption under Section 80-G:
The second issue was whether the renewal of exemption under Section 80-G should be denied during the subsistence of registration under Section 12A. The appellant argued that the society is an educational institution recognized by government bodies and universities, with no activities beyond education. The society's registration under Section 12A was continuous and had not been withdrawn, thus, renewal under Section 80-G should not be denied. The appellant cited a declaration by 11 members affirming that the society's sole objective was education, and the inability to amend the constitution was due to the pending court dispute.

Tribunal's Findings:
The tribunal referenced a similar case, Mayo College Old Boys Association vs. DIT (E), New Delhi, where it was held that renewal of exemption under Section 80-G could not be denied during the subsistence of registration under Section 12A. The tribunal noted that the CIT had not provided evidence that the society engaged in non-educational activities. The tribunal emphasized that the scope of inquiry under Section 80-G extends to eligibility for exemption, not the actual computation of income.

Conclusion:
The tribunal concluded that the CIT had wrongly refused the renewal of exemption under Section 80-G. It directed the CIT to grant the renewal, as the society's registration under Section 12A was still valid and had not been withdrawn. The appeal filed by the assessee was allowed, and the order was pronounced in the open court on 20.04.2011.

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