TaxTMI 
TaxTMI 
2014 (6) TMI 334
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....e grounds of appeal at the time of hearing. 2. The assessee, a public charitable trust, was registered u/s. 12A of the Act, on 6. 3. 2004. It filed its return of income for A. Y. 2009-10 on 29th September 2009 declaring total income at Rs. Nil. The Director of Income-tax (Exemption), Mumbai(DIT-E), received a proposal from the ADIT (E)-II (1), Mumbai for cancellation of registration granted to the assessee on the ground that the it was carrying on activities in the nature of trade, commerce or business, etc. Accordingly, vide show cause notice, dated 3. 11. 2011, the assessee trust was asked as to why the registration granted to it should not be withdrawn by invoking the provisions of section 12AA(3) of the Act as the income earned by it....
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....trust were not genuine or the activities of the trust were not being carried out in accordance with the objects of the trust, that section 12AA(3) of the Act did not authorise the DIT(E) to cancel registration u/s. 12A, if he was of the opinion that the activities of the assessee trust involved the carrying on of any activity in the nature of trade, commerce or business, that DIT(E) had failed to bring out any fact that the activities of the assessee trust were not genuine or were not carried out as per the objects of the trust, that the assessee was holding seminars solely for achieving and fulfilling the objects of the trust of parting with information and knowledge in respect of internet and its usage, that the activity of holding semina....
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....ges have been brought about the trusts and in the definition of the phrase charitable activities. Similarly, certain changes had occurred in the statute when power was given to the departmental authorities to cancel the registration as per the provisions of section 12AA(3)of the Act. We find that the Explanatory Notes to the provisions of the Finance Act, 2010(Circular No. 1/2011[F. No. 142/l/2011-SO(TPL)-I, dated 6-4- 2011) has explained the background for bringing change in the section as under: "7. Cancellation of registration obtained under section 12A 7. 1. Section 12AA provides the procedure relating to registration of a trust or institution engaged in charitable activities. Section 12AA(3)previously provided that if the activit....
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....anted, the same could be cancelled only on satisfaction of two conditions laid down in section 12AA(3) of the Act, viz. , (a) that the activities of the trust or institution are not genuine; and (b) that the activities of the trust or institution are not being carried out in accordance with the objects of the trust or institution. The Hon'ble High Court expressed the view that there must be specific findings with regard to the aforesaid two conditions. We find that the DIT(E) has not given specific finding as required by the Hon'ble Madras High Court. Holding of seminars cannot be termed a commercial or business activity in the case under appeal, as the trust was established for this specific purpose. DIT(E)has ignored the fact the trust ha....
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....egistration granted under any of the clauses of sub-section (1) of section 12A......Section 12AA(3) of the Act empowers the CIT to cancel such registration if he satisfy that activities of the trust or institutions are not genuine or are not being carried out in accordance with objects of the trust or institution as the case may be. The combined reading of both the sections makes it clear that before 01. 06. 2010 registration can be cancelled only on those cases where the registration has been granted under section 12AA(1)(b) of the Act. Before 01. 06. 2010 this section 12AA(3) nowhere empowers the CIT to cancel or withdraw registration under section 12A of the Act. In absence of such power, the registration granted under section 12A cannot....