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2011 (9) TMI 1022
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....The order passed by ld CIT (Central) is not a 'speaking order' and runs counter to the provisions of law. 2. On the facts and circumstances of he case and in law especially when ld CIT (Central) having recorded a finding that "There is no doubt that the Trust is running Educational institutions" inescapable conclusion should have been grant of registration as prayed for after condonation of delay. The appellant-Trust for a longer period of 20 years or so remained under bona fide impression that it was duly registered u/s 12A(a) of the Act. 3. on the facts and in the circumstances of the case and in law and since on the basis of the bona fide thinking that it was duly registered u/s 12A(a) but the registration Certificate was not traceable all the while such request to that effect was made to ld CIT, Pune. Since the ld. CIT's finding that the Trust is running Educational institutions then it was entitled to registration under sec. 12AA as prayed for. 4. On the facts and in the circumstances of the case and in law the ld CIT's order dated 29.8.2007 is vitiated in law since he failed to appreciate the legal position that source of funds is not important but application of fun....
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....of its income under section 11 of the Act for the reason that the assessee was unable to produce registration certificate under section 12A of the Act. It was claimed that the assessee misplaced the Certification of Registration and could not produce it because the Certificate was given 20 years back and further that such certificate issued under section 12A must be available on the record of the Commissioner of Income-tax, Pune. It was also pleaded in the alternative that the assessee be granted registration with retrospective effect. i.e. from the date of creation of the Trust and the delay may be condoned. In order to verify the above facts, the Commissioner of income-tax called for a report from the Assessing Officer which was confronted to the assessee. The assessee filed detailed written arguments. 4. After considering the detailed submissions of the assessee, the Commissioner of Income-tax observed that the assessee known as D. Y. Patil Educational Society, Kolhapur, is duly registered under the Bombay Public Trusts Act, 1950 on 13.3.1987 and the Trust came into being from 23.11.196 as per Trust Deed. He further observed that "There is no doubt that the Trust is running E....
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....on with effect from 12.2.2007, i.e. the date on which the application was received. After making detailed enquiry on all aspects of the matter, the Commissioner of Income-tax rejected the application for registration under section 12A(a) of the Act by holding as under: "13.2 While granting registration, the assessee has not come with clean hands. I have also to see the past conduct of the assessee. For 19 years, the assessee has not filed its return of income. It has not allowed the department to examine either the veracity of the accounts or to find out whether the assessee has complied with the provisions of section 13 of the IT Act 1961. The assessee has filed an application for registration. But this application for registration has to be handled with utmost care. This is statedly because of the stand that the application for registration u/s 12AA is based upon written statement that since the assessee has been granted deduction u/s 80G it must have been registered u/s 12AA of the IT Act, 1961, which has been found to be .... Therefore is no guarantee that after granting of registration the assessee will come clean. 14. In the result, I have no hesitation in concluding th....
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.... impression as a reasonable cause for the unintended delay in seeking registration. 8. In the course of his submissions, the learned Counsel has relied upon the following decisions: (i) Sanjeevamma Hanumanthe Gowda Charitable Trust v. DIT (Exemption) 285 ITR 327 (Kar); (ii) Rama Rao Adik Education Society, Mumbai v. CIT Cen.1, Mumbai, vide ITA No 5742/Mum/07 dated 11.02.2008 (iii) Saint Kabir Educational Trust v. CIT 41 DTR (Asr)(Trib) 267; and, (iv) Church of Our Lady Grace v. CIT 9 ITR (Trib) 505 (Mum) 9. On the other hand, the ld CIT-Departmental Representative, appearing for the Revenue, has defended the order of the Commissioner on all the points by pointing out that the pleas of the assessee have been examined by the Commissioner of income-tax on relevant considerations and found unacceptable. It was pointed out that merely because the assessee was granted recognition under section 80G vide certificate dated 09.06.1989 would not lead to a presumption that it was registered under section 12A(a) of the Act, inasmuch as at the relevant point of time the requirement of furnishing a copy of the registration certificate under section 12A at the time of seeking ....
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.... On this basis, the case made out was that since the recognition under section 80G of the Act was granted, the assessee would have enjoyed the registration under section 12AA of the Act also. In the alternative, the plea of the assessee was that the aforesaid impression of the assessee be treated a reasonable cause for the delay in approaching the Commissioner for registration and, therefore, the registration be granted with retrospective effect, i.e. from the date of incorporation of the Society and the delay be condoned. The Commissioner has denied the registration. Hence the assessee is in appeal before us. 11. One of the conditions for claiming exemption under sections 11 & 12 of the Act in respect of income of a charitable or religious trust or institution is that the person in receipt of income shall make an application for registration of the trust or institution in the prescribed form and in the prescribed manner to the Commissioner within the specified time. Section 12AA provides for a procedure to be followed by the Commissioner for the grant of registration to a trust or an institution. According to this procedure, the Commissioner shall call for documents and ....
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....ommissioner is to the effect that the assessee society is said to be running on commercial lines and not for charitable purposes. In this regard, the Commissioner has relied upon the report of the Assessing Officer wherein two instances have been brought out to show that the assessee was charging capitation fees. Such details are contained in para 12.2 of the impugned order. The explanation of the assessee has also been reproduced by the Commissioner in para 12.4 of his order. However, the Commissioner was not satisfied with the explanation furnished. On this aspect, for the present, we do not dwell on the merits of the rival stands which we would do a little later. Pertinently, it is not disputed by the Commissioner and rather it is an accepted position that that the assessee society is engaged in running educational institutions. In fact, it is also emerging from the order of the Commissioner that there is neither an assertion of a view that the above activities carried on by the assessee are not genuine and nor it is the case of the Commissioner that the activities carried on by the assessee are not in consonance with its objects. 13. Though the assessee has denied receipt of....
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....or the specified purposes, which only entitles the assessee to claim exemption. The Court observed that for arriving at such satisfaction primarily he has to look at the object of the trust, when the same is reduced into writing in the form of trust deed. If on the date of the application the trust has received income from its property, then find out how the said income has been expended, and whether it can be said that the income is utilized towards charitable and religious purposes. Therefore, for the purposes of registration u/s. 12AA of the Act, what the authorities have to satisfy is the genuineness of the activities of the trust or institution and how the income derived from the trust property is applied to charitable or religious purposes and not the nature of the activity by which the income was derived to the trust. 50. The above judgment proposes that what is to be looked into is the character of application of funds and the character of the activities carried out by an assessee and not the colour and nature of the sources out of which necessary funds were collected by the assessee. In other words, the source of funds is not an important ingredient in assessing the cha....