TaxTMI 
TaxTMI 
2019 (3) TMI 580
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....ner's order was passed on no materials and that there was absolutely no satisfaction entered into as to the objects of the assessee being not genuine or the assessee having not carried on the activities as declared in the Memorandum of Association (MoA)? (2) Has not the Tribunal committed an error amounting to perversity in having confirmed the orders of the Commissioner? 2. The assessee is said to have been formed in the year 1995 and applied for a registration under Section 12A of the Income Tax Act, 1961 ("Act" for short). The application of the assessee was also favourably considered and registration granted as per Annexure-A1. Later, the law stood amended and Section 12AA came into force which also contained a provision....
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....ction 12AA by a notice dated 31.01.2011. The notice specifically called upon the assessee to show cause as to why the registration granted under Section 12A should not be cancelled for reason of the activities of the assessee no more being considered as a charitable activity. The Chairman of the assessee appeared before the Commissioner and contended that the activity of the assessee comes within the meaning of "relief to the poor" as it gives employment to poor people. When the assessee was asked to demonstrate as to the activities carried on which comes within the nomenclature of "relief to the poor", it was submitted that the nature of job offered would itself indicate that only poor people can apply for it. The Commissioner found that t....
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.... decide on the exemption applicable to such income. This was by Annexure-A5 order. 6. The assessee then filed a Miscellaneous Application before the Tribunal and submitted that it was never the contention of the assessee that the provision of employment to the poor would come under general public utility. It was always the stand of the assessee that it had been providing employment to the poor only and hence the same would come within the objects as seen from the MoA, which is provision of employment to the poor, a charitable activity. The stand hence was that this activity of providing employment to the poor would be a charitable purpose and hence they are entitled to continue their registration granted under Section 12A. The Tribunal b....
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.... and that it was to be adjusted towards the fees of each year of study. The Division Bench of this Court found that when considering the aspect of registration simplicitor, there is no requirement of an examination of the modus of fund application or the ethical background of its settlers. The preliminary requirement is only an examination of whether the trust is constituted genuinely for carrying on charitable activities and whether it has the capacity to so carry out its professed objects. The application of its funds and the operations as such being in consonance with the objects are all considerations at the time of actual claim of exemption which is made at the time of assessment. What distinguishes the present case is that the questio....
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....ople from the weaker sections of Society would not absolve the contractor from the labour legislations and such work is one carried out with a clear intention at making profit. The assessee having bid in a competitive tender had been awarded the work for a consideration agreed upon between the parties and carrying on of such work cannot be categorised as a charitable work merely because the poor or persons from marginsalised sections are given employment. The execution of the work awarded by the Railways, is not a public utility service carried on by the assessee and the mere fact that the poor are employed in such execution of contract awarded, would not make it a charitable purpose. 10. Further though the assessee is said to have provi....