TaxTMI 
TaxTMI 
2013 (8) TMI 321
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....us the order rejecting the registration should be reversed and registration u/s 12A granted to the assessee should be revived. 2. The appellant craves the leave to add, substitute, modify, delete or amend all or any ground of appeal either before or at the time of hearing." 2. A perusal of the impugned order shows that the DIT(E) on examination of the application of the assessee held that the society was not genuine and not carrying on charitable activities. As a result Registration u/s 12A was cancelled. While coming to the said conclusion, it is seen that DIT(E) observed that the assessee was granted registration u/s 12A vide order no.-S-3144/02/626 dated 29.09.2010 of DIT(E), it had been granted on the grounds that as per the Memorandu....
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....ate safeguards and authorization, it was submitted that the borrower's societies were in a financial crunch and having close association and also having similarity of the objects with that of the assessee accordingly the society's funds were pledged. 2.3. The AO observed that Sh. Ashok Khosla was the Chairman of the 3 societies and the transaction was in contravention to section 13(1)(c) and provisions of section 13(2) as such the trustee misused the funds of corpus and diverted the income of the trust in favour of the interested persons accordingly it was held that it was in violation of provisions attracted thereby exemption u/s 11 was denied. 3. In view of these facts, a show-cause notice u/s 12AA(3) dated 16.06.2010 was issued to the ....
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....respect of various scientific, social, environmental subject was held to be not a charitable activity especially since the benefits of the research of the assessee is commercially exploited by the sister societies. It was also found that the assessee's society was not having separate books of accounts for each project despite the fact that each project had been awarded by different agencies with specific terms and conditions as such the society had violated the provisions of sub-section (4A) of Section 11 of the Income Tax Act. The assessee society in the circumstances was held to have failed to discharge the onus that it was carrying on charitable activities. The DIT(E) observed that not a single activity had been done by the assessee out ....
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....tities enjoying benefit u/s 12AA of IT Act. In the instant case, as detailed in the earlier paragraphs, direct benefit has been provided to these commercial organizations for their profits. There is direct violation of section 13 by conferring these benefits on regular basis. Also pledging of society's FDRs to facilitate loan to those referred above is violation of Law. Apart from violation u/s 13 of IT Act, the society also found not carrying on any charitable activity on its own. Whatever activity carried, it is only done on contractual obligation. Hence, it is established beyond reasonable doubt that the society is not genuine and it is not carrying on charitable activities. Accordingly, registration u/s 12A is cancelled forthwith since ....
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....n rejecting the application of the assessee is not maintainable. 5. The Ld. Sr. DR on the other hand contended that the action of the society in offering its funds as collateral is not governed by any charitable act and the assessee's society has also made available its research work to the two related societies who as per record have exploited commercially the benefit of the efforts of the research that has resulted on the part of the assessee's society for which exemption is being claimed. These facts available on record have neither been considered nor discussed in the orders relied upon. It was submitted that these are cogent relevance and important points which have a bearing on the issue being decided. It was reiterated that the bene....