TaxTMI 
TaxTMI 
2017 (3) TMI 1765
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....e the Commissioner of Income Tax(Exemption) was not justified in rejecting the applications of the appellant for registration u/s 12AA of the Income Tax Act. 3. That the claim of the appellant for registration u/s 12AA has been rejected on irrelevant erroneous and unwarranted considerations. 4. That the CIT(Exemption) has traveled beyond the scope of enquiry envisaged u/s 12AA for granting registration and as such his order is against the law and facts of the case. 5. That the CIT(E) failed to appreciate that the assessee was already enjoying exemption u/s 10(23C)(iiiad) and was considered as engaged in the sole object of imparting education and therefore registration u/s 12AA could not have been denied. ....
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....ery seeking the rationale for application u/s 12A it has been stated that exemption u/s 10(23c)(iiiad) has been allowed to the society by Income Tax Department for earlier years. Notwithstanding the claims exemption is available to any university or educational institutions. The judiciary in the case of pinegrove International has held that such institutions that are registered as societies are eligible for exemption u/s 10(23C) 9 Although the Judicial precedents have allowed alternative claims either for 12AA or 10(23C) but at the same time haven't allowed shifting from one provision to the other when the applicant has consistently availed benefits for a number of year under section 10(23C)(iiiad). Natural progression entails ....
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....ve it is also clear that department has held a couple of the institutions under ( the society not fit to be captioned existing 'solely for education' and not for profits. This aspect of the institutes under it point towards proclivities towards profit- making an aspect that has been frowned upon by the judiciary and held to be not attuned to the noble task of education. 10. Notwithstanding the same the claims for registration u/s 12A were examined. The Audited accounts reveals that over the period of time the emphasis of the society is mainly on providing loan to schools which are under its aegis and to earn interest income no. No other activity in pursuance of objects have been done. This thing also gets exacerbated by the....
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....g registration, has to satisfy himself that the objects of the trust are charitable and the activities of the trust are genuine. However, the DCIT who examined the case tried to examine the application of the income, which is not permissible at the stage of granting of registration. 6. In "CIT vs. Surya and Bahara Educational and Charitable Trust", 355 ITR 280 (P & H), it has been held that u/s 12AA of the IT Act, the income tax Authorities are to examine the genuineness of the trust, whereas the application of the income of the trust is not to be considered. 7. In "CIT vs. Vijay Vargiya Vani Charitable Trust", 369 ITR 360 (Raj), it has been held that at the time of registration of a trust, only the genuineness of the objects of the t....
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....3C) or u/s 11 of the IT Act, the choice should be left to the assessee and the assessee cannot be denied exemption u/s 11 on the ground that it ought to have claimed exemption u/s 10(23C), more so, when it has been granted the benefit of exemption u/s 11 in the past. 13. Further, the CIT(E) has given another reason for declining registration, in para 9, that two of the institutions, namely, Doaba College and Kanya Maha Vidayalaya, run by the assessee society, have been declined registration u/s 10(23C)(vi) on the ground that they are not solely established for the purpose of imparting education and are making systematic profits. This finding of the CIT(E) cannot be sustained, since in cases of both the institutions, the ITAT has allowed ....