2015 (5) TMI 87

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....014 passed in ITA No.440/RJT/2013 for registration under Section 12 AA of the Income Tax Act (hereinafter referred to as the "Act"), by which, the learned Tribunal has allowed the said appeal preferred by the respondent assessee trust and has directed the Commissioner of Income Tax, Jamnagar to grant registration under Section 12AA of the Act to the assessee trust, the Revenue has preferred present Tax Appeal raising the aforesaid substantial question of law. TAX APPEAL NO. 916 OF 2014 3.1. Feeling aggrieved and dissatisfied with the impugned judgment and order passed by the learned Tribunal Income Tax Appellate Tribunal, "SMC" Bench, Rajkot dated 30.5.2014 passed in ITA No.441/RJT/2013 for registration under Section 12 AA of the Income Tax Act (hereinafter referred to as the "Act"), by which, the learned Tribunal has allowed the said appeal preferred by the respondent assessee trust and has directed the Commissioner of Income Tax, Jamnagar to grant registration under Section 12AA of the Act to the assessee trust, the Revenue has preferred present Tax Appeal raising the aforesaid substantial question of law. TAX APPEAL NO. 917 OF 2014 3.2. Feeling aggrieved and dissatis....

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.... of any "dissolution clause" in the trust deed and and in absence of any provision in the trust deed with respect to property of the trust in the event of its "dissolution", when Commission of Income Tax, Jamnagar doubted the genuineness of the trust and / or its bona fide and consequently when the Commissioner, Jamnagar refused to grant registration under Section 12 AA of the Act to the respective assessee trust, the learned Tribunal has materially erred in interfering with the order passed by the Commissioner, Jamnagar and has materially erred in allowing the respective appeals and directing the Commissioner, Jamnagar to grant registration under Section 12 AA of the Act to the respective assessee trust. 5.1. Relying upon the provisions of Section 12 AA of the Act, it is vehemently submitted by Shri Desai, learned counsel for the Revenue that grant of registration under Section 12 AA of the Act is on the subjective satisfaction of the Commissioner with respect to (1) genuineness of the activities of such trust or institution and (2) the activities are being carried out in accordance with objects of the trust or institution. It is submitted that therefore, when on verification o....

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....tificate / new/ fresh registration certificate. It is submitted that therefore, without admitting that in absence of any "dissolution clause" and / or any provision in the event of dissolution / closure of the trust whether the registration under Section 12 AA of the Act can be refused or not, it is vehemently submitted that in the peculiar facts and circumstances of the case when since many years the trust is in existence; they are carrying on their activities since long and they are registered with the office of the Charity Commissioner since many years (approximately more than 25 to 30 years) and that they are filing return of income every year and they are claiming exemption since many years and same have been granted and / or accepted by the concerned AO there was no reason for the Charity Commissioner to doubt the genuineness and / or bona fide of the trust and therefore, the Commissioner, Jamnagar was not justified in refusing the registration under Section 12 AA of the Act solely on the ground that in the trust deed there is no "dissolution clause" and / or provision in the event of dissolution and / or closure of trust. 7.0. To the aforesaid, Shri Desai, learned advocat....

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....sioner to issue the registration certificate under Section 12 AA of the Act to the assessee trust solely relying upon the decision of the Coordinate Bench in the case of Chargam Dasha Porwad Mahamandal (supra). That the decision of the Tribunal in the case of Chargam Dasha Porwad Mahamandal (supra), however has been confirmed by the Division Bench of this Court. However, it is required to be noted that in the case of Chargam Dasha Porwad Mahamandal (supra) in fact there was a dissolution clause. Therefore, as such on facts, learned Tribunal has materially erred in relying upon the decision of the Coordinate Bench in the case of Chargam Dasha Porwad Mahamandal (supra). 10. It is true that while considering the issue of registration certificate under Section 12 AA of the Act, the Commissioner is required to be satisfied himself about the objects of the trust or institution and the genuineness of its activities and after satisfying himself about the objects of the trust or institution and the genuineness of its activities may pass an order in writing registering the trust or institution and grant the registration certificate under Section 12 AA of the Act. 11. As observed herein....