TaxTMI 
TaxTMI 
2005 (5) TMI 52
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....owever, subsequently in the general body meeting of the society held on September 17, 1989, the memorandum and articles of the society, containing the objects, were re-arranged with the following new objects: "(a) To spread the technical and professional education in addition to basic education. To arrange for the higher education without any difference of caste, colour and creed. To start new institution of different types for education in future. (b) To build hospital and health related institutions where physical and mental patients can be treated, to arrange for housing for patients during illness where doctors, nurses, pharmacists, compounders can be trained, and to provide facilities for the family welfare. (c) To conduct any type of work which is of charitable and public interest, without any religious, caste and creed, communal or discrimination in regard to male/female." On deletion of section 10(22) of the Act, vide its application dated March 16,1999, the petitioner applied for registration under section 10(23C) of the Act. The registration was granted for the assessment year 1999-2000 by the Central Board of Direct Taxes. Again on October 5, 2000, the petitioner app....
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....mainly on the grounds that: (i) The society should have applied for fresh registration under section 12A(a) of the Act because it had materially changed its objects from being confined to the field of education to wide ranging objects in the field of health and medical education as also all sweeping objects to conduct any type of work which is charitable and in public interest and having failed to apply for fresh registration under the said section, its income would not be exempt under section 11 of the Act; (ii) the institution has not been notified under section 10(23C) of the Act for the assessment year 2000-01 onwards and, therefore, the conditions specified in section 80G(5)(i) and (vi) are not satisfied; (iii) since the society has acted in the form of a public charitable trust and had claimed exemption under section 80G of the Act in the past, the correct procedure for amendment in the objects and memorandum of association was to get it amended under section 92 of the Code of Civil Procedure as observed by the Supreme Court in the case of Trustees of H.E.H. The Nizam's Pilgrimage Money Trust v. CIT [2000] 243 ITR 676 had not been followed; (iv) the society was earning in....
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...., donations of which could qualify for deduction from the income of a donor is included a subsidiary clause in the form of clause (a)(iv) of sub-section (2) of section 80G, which talks of "any other fund or any institution to which section 80G applies". At this juncture, it would be apposite to extract the relevant part of sub-section (5) of section 80G, which refers to the donations to any institution or fund, referred to in sub-clause (iv) of clause (a) of sub-section (2): "(5) This section applies to donations to any institution or fund referred to in sub-clause (iv) of clause (a) of sub-section (2), only if it is established in India for a charitable purpose and if it fulfils the following conditions, namely: (i) where the institution or fund derives any income, such income would not be liable to inclusion in its total income under the provisions of sections 11 and 12 or clause (22) or clause (22A) or clause (23) or clause (23AA) or clause (23C) of section 10: Provided that where an institution or fund derives any income, being profits and gains of business, the condition that such income would not be liable to inclusion in its total income under the provisions of section 11....
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....be liable to be included in its total income under the provisions of sections 11 and 12 or clause (22) or clause (22A) or clause (23) or clause (23AA) or clause (23C) of section 10 of the Act. Clause (vi) of sub-section (5) of section 80G, with which we are concerned in the present case, was inserted with effect from October 1, 1991 by the Finance (No. 2) Act of 1991. It requires that in relation to donations made after March 31, 1992, the institution or fund has to be approved by the Commissioner in accordance with the rules made in this behalf. Simultaneously, rule 11AA was inserted in the Rules. Under the proviso, approval under the section can be for more than one year at a time, up to 5 years, and can be renewed from time to time. From the afore-extracted provisions, it is evident that the first and foremost requirement which the institution or fund has to satisfy is that it is established in India for a charitable purpose. The conditions contemplated by clauses (i) to (vi) of section 80G(5) are the conditions which the institution or the fund must additionally fulfil so as to be entitled to the approval of the Commissioner. It is well-settled that for the purpose of constru....
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....titioner had enjoyed approval under section 80G of the Act from the year 1991 to March 31, 1999, i.e., even after the amendment of its objects on September 17, 1999, and after the insertion of clause (vi) with effect from October 1, 1991, the Commissioner was not justified in holding that either fresh registration under section 12A(a) of the Act was required or the memorandum should have been amended as per the procedure laid down in section 92 of the Code of Civil Procedure. In Radhasoami Satsang v. CIT [1992] 193 ITR 321 their Lordships of the Supreme Court, inter alia, observed that though strictly speaking, res judicata does not apply to income-tax proceedings, where a fundamental aspect permeating through the different assessment years has been found as a fact one way or the other and parties have allowed that position to be sustained by not challenging the order, it would not be, at all, appropriate to allow the position to be changed in a subsequent year. We feel that these observations are quite apposite in the present case. The ratio of the decision of the apex court in Nizam's case [2000] 243 ITR 676 is not attracted in this case. As regards the question whether the peti....