Tribunal Directs Registration for Charitable Society Despite Doubts

The Tribunal allowed the appeal, directing CIT (Exemptions) to grant registration to the appellant under section 12AA. Despite doubts raised by the respondent regarding the genuineness of activities, the Tribunal found the society's objects to be charitable and aligned with its objectives. Emphasizing that CIT (Exemptions) should focus on assessing the genuineness of activities at the time of registration, the Tribunal dismissed the denial based on lack of evidence, citing relevant case law. The decision was pronounced on 28/02/2018.

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Issues:
Registration u/s 12AA denied by CIT (Exemptions) - Object of the assessee and genuineness of activities questioned.

Analysis:
The appeal was filed against the order of CIT (Exemptions) denying registration u/s 12AA. The appellant argued that the society's objects are charitable, supported by audited financials and income tax returns, indicating alignment with its objectives. The appellant cited relevant case laws to support their claim, emphasizing that CIT (Exemptions) should only examine the objects and genuineness of activities at the time of registration, not delve into Section 13(1)(c) matters, which are under the Assessing Officer's purview during assessment.

The respondent contended that the appellant failed to provide books of account and vouchers, raising doubts about the genuineness of unsecured loans. However, the appellant refuted this claim by presenting letters confirming the submission of books of account for verification.

Upon review, the Tribunal found that the society's objects were charitable, undisputed by CIT (Exemptions). The rejection was based on a lack of evidence for the genuineness of activities, despite the appellant submitting audited financials and income tax returns. The Tribunal dismissed the respondent's argument regarding unproduced books of account, as evidence showed otherwise.

The Tribunal highlighted that at the time of granting registration u/s 12AA, CIT (Exemptions) is empowered to assess the objects and genuineness of activities. Citing the Allahabad High Court judgment in CIT vs. Red Rose School, it was emphasized that the CIT (Exemptions) must ensure activities align with the trust's objectives and are genuine. The Tribunal concluded that since the appellant's activities were charitable and aligned with its objectives, registration could not be denied on the grounds of activity genuineness. Therefore, the Tribunal directed CIT (Exemptions) to grant registration to the appellant u/s 12AA.

In conclusion, the appeal was allowed, and the decision was pronounced in open court on 28/02/2018.

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