Charitable registration renewal must rest on the statutory renewal test, not old search-year allegations or cancellation grounds.

In renewal proceedings under the amended charitable registration regime, the authority must confine itself to the statutory enquiry for renewal and cannot import cancellation grounds or rely on earlier search-year allegations. Territorial exemption jurisdiction was treated as distinct from assessment jurisdiction, so transfer of the assessment case did not by itself transfer the power to decide renewal applications. The Tribunal also held that old material, settlement proceedings, and unproven past violations could not be used to deny renewal where the charitable and educational activities were found genuine and supported by the assessment report. Renewal was therefore directed to be granted with the requisite certificate.

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Issues: (i) Whether the Principal Commissioner had jurisdiction to decide the applications for renewal of registration under the amended charitable registration regime; (ii) Whether renewal could be refused by relying on material relating to earlier search years and alleged violations already considered in the separate cancellation proceedings.

Issue (i): Whether the Principal Commissioner had jurisdiction to decide the applications for renewal of registration under the amended charitable registration regime.

Analysis: The applications were filed for renewal of registration under the post-2021 regime. The statutory scheme distinguishes between grant or renewal of registration and cancellation of registration. The Board's territorial notification placed exemption cases within the charge of the Commissioner of Income-tax (Exemptions), and the transfer of the search assessment case did not, by itself, transfer the separate exemption jurisdiction. The Tribunal also noted that the power to act on specified violations under the amended cancellation framework could not be presumed to have been transferred to the Principal Commissioner merely because assessment jurisdiction was centralized.

Conclusion: The jurisdictional objection was accepted and the impugned action could not be sustained on that basis.

Issue (ii): Whether renewal could be refused by relying on material relating to earlier search years and alleged violations already considered in the separate cancellation proceedings.

Analysis: For renewal under the relevant provision, the enquiry was confined to the genuineness of activities and compliance with other material laws. The Tribunal held that the Principal Commissioner wrongly mixed the renewal exercise with the cancellation framework and placed undue reliance on older search-related material, settlement proceedings, and alleged past violations. The assessee's educational activities were found to be genuine, the Assessing Officer's report supported that position, and the Settlement Commission had not established siphoning of funds or a basis to deny the charitable character of the institutions. Old allegations and pending cancellation controversy could not justify refusal of renewal.

Conclusion: Renewal could not be refused on the grounds relied upon in the impugned orders, and the assessee succeeded on merits as well.

Final Conclusion: The impugned orders were unsustainable both on jurisdiction and on merits, and the Revenue was directed to renew the registration and issue the requisite certificate.

Ratio Decidendi: In renewal proceedings under the amended charitable registration scheme, the authority must confine itself to the statutory enquiry for renewal and cannot deny renewal by importing unrelated cancellation grounds, old search-year allegations, or a transferred assessment jurisdiction that does not extend to exemption jurisdiction.

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