Tribunal orders tax registration for inactive trust based on genuine objects, rejecting revenue's operation requirement.

The Income Tax Appellate Tribunal directed the Deputy Commissioner of Income Tax to grant registration and approval under sections 12AA and 80G to a trust that had not commenced any activities. The Tribunal emphasized that the term "activities" includes proposed activities, and as long as the genuineness of the trust's objects was not in question, the revenue could not refuse registration solely based on the lack of operations. The court ruled in favor of the trust, dismissing the Tax Case Appeals without costs, based on established legal precedents and interpretations of relevant provisions.

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Issues:
Registration under section 12AA and approval under section 80G for a trust with no activities started.

Analysis:
The case involved the challenge against a common order passed by the Commissioner of Income Tax (Appeals) regarding the registration of a trust under section 12AA and approval under section 80G. The trust had applied for registration, but as no activities had commenced, the Deputy Commissioner of Income Tax (DITE) rejected the application due to the inability to verify the trust's objects and activities. The Income Tax Appellate Tribunal allowed the trust's appeals, directing the DITE to grant registration and approval. The key question of law was whether the trust was entitled to registration and approval despite not starting any activities.

During the hearing, the respondent cited relevant legal precedents, including a Supreme Court decision and an unreported judgment by the same bench. The Supreme Court's ruling emphasized that the term "activities" in section 12AA includes proposed activities, requiring consideration of the trust's charitable nature and alignment with its objects. The unreported judgment highlighted that if the genuineness of a trust's objects was not in question and operations had not commenced, the revenue could not refuse registration upfront. The bench found the precedents applicable to the current case.

The appellant failed to provide any contradictory judgments to support their argument. Consequently, the court, following the Supreme Court's and its own previous judgments, ruled against the revenue and in favor of the trust. The Tax Case Appeals were dismissed with no costs incurred. The decision was based on the interpretation of relevant legal provisions and established case law, ensuring consistency in the treatment of trusts seeking registration and approval under the Income Tax Act.

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