TaxTMI 
TaxTMI 
2020 (1) TMI 1045
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....t-company. 2. That the learned Commissioner of Income-tax (Exemptions), Chandigarh has erred in requiring the appellant to produce a provi sional balance-sheet for the financial year 2018-19 as against the provisional balance-sheet submitted by the appellant even before the end of the above stated period and thus requiring the appellant to comply with an impossibility as per his findings in para 7 on page 6 of his order. 3. That the learned Commissioner of Income-tax (Exemptions), Chandigarh has erred in alleging that the appropriate replies to the queries raised by him have not been submitted by the appellant as per his findings in para 7 on page 6 of his order. 4. That the learned Commissioner of Income-tax (Exemptions), Chandigarh has erred in presuming that the purpose of creating the appellant-company was to meet the corporate social responsibility objectives of the parent company M/s. Roundglass Wellbeing Private Limited as per his allegations in the point 7(1) on page 6 of his order. 5. That the learned Commissioner of Income-tax (Exemptions), Chandigarh has erred in concluding that the appellant-company has been formed to have a close arr....
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....als and organisations working for the welfare of public at large, who have been identified and selected for this purpose, (ii) companies for the project or social cause where a part of the funds so raised goes to charity and (iii) individuals for their personal emergencies, including but not limited to healthcare and education related emergencies. 4. The learned Commissioner of Income-tax (Exemptions) to verify the genuineness of the activities of the company called for various information and record. The learned Commissioner of Income-tax (Exemptions) after appraisal of the records submitted by the assessee-company observed that the assessee-company namely M/s. Roundglass Foundation was, in fact, is a corporate social responsibility (CSR) arm of another company M/s. Round Glass Wellbing Private Limited. He further observed that M/s. Round Glass Wellbing Private Limited was one of the main members of the appellant-company and further that the main contributions have been provided by the said M/s. Round Glass Wellbing Private Limited to the appellant-company. That the share capital in totality had been contributed by pre-dominant stake holder. The learned Commissioner of Income-t....
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....nfessedly and given its restrictive composition it surely does not enure to the benefit of general public nor does it partake of the meaning of a public charitable company. The application in the above case for registration under section 12A is hereby rejected." 5. Being aggrieved by the said order of the Commissioner of Income-tax (Exemptions), the appellant-company has preferred an appeal before us. 6. A perusal of the impugned order of the learned Commissioner of Income-tax (Exemptions) reveals that the learned Commissioner of Income-tax (Exemptions) nowhere in the impugned order has pointed out that the appellant-company has not been acting as per its objectives or that the activity of the appellant-company was not genuine vis-a-vis its objects. The main plea taken by the learned Commissioner of Income-tax (Exemptions) is that the said company is an arm of another company namely M/s. Round Glass Wellbing Private Limited for the purpose of carrying out their corporate social responsibility liability. That otherwise the main control over the appellant-company is of M/s. Round Glass Wellbing Private Limited. However, there is no allegation or observation by the learned Commi....
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....12AA of the Income-tax Act. As regards the reasons (iii) given by the Commissioner of Income-tax (Exemptions) that the object of trust are to be noted whereby apart from the corporate social responsibility activities, the activities in the nature of eradicating hunger and poverty, promotion of education, promoting gender equality, etc., are also provided. These activities are in the nature of public charity. Further, the corporate social responsibility activities itself are in the nature of public charitable activities. As regards the reasons (iv) given by the Commissioner of Income-tax (Exemptions), no activities in sync with the requirement of the Companies Act has taken place in the trust so far. For the purpose of granting registration under section 12AA only two factors are to be seen by the Commissioner of Income-tax (Exemptions) which are the objects of the trust being charitable in nature and the genuineness of activities. There is no requirement to see where the activities are in sync with the Companies Act or not. Reasons (v) given by the Commissioner of Income-tax (Exemptions) that the activities so far further show that the trust is relinquished its function as....