12AA registration cannot be denied on bare allegations of commercial activity without proof that objects are not genuinely pursued.

Registration under section 12AA should not be refused merely on allegations of commercial activity where the record shows prior registration, the earlier cancellation has already been set aside, and there is no material that the entity's activities are not genuine or inconsistent with its stated objects. On that basis, the rejection of the fresh application lacked support in the record, and registration was directed to be granted.

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Issues: Whether the refusal to grant registration under section 12AA of the Income-tax Act, 1961 to the assessee was justified.

Analysis: The assessee had earlier been granted registration and the cancellation of the earlier registration had already been set aside. The record did not show that the assessee had carried on activities contrary to its stated objects or that its activities were not genuine. The mere allegation of commercial activity, without material demonstrating violation of the statutory conditions for registration, was insufficient to deny registration. The Tribunal therefore found no basis to sustain the rejection of the fresh application.

Conclusion: The refusal to grant registration was not justified and registration under section 12AA was directed to be granted.

Ratio Decidendi: Registration under section 12AA cannot be denied or refused merely on allegations of commercial activity unless there is material showing that the activities are not genuine or are not being carried on in accordance with the stated objects.

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