2020 (3) TMI 464

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....e are that the assessee is a trust established on 31.07.2017 with the main object of a)construction or building or take over and maintain "dharmashala" or ashram etc. of similar nature for providing accommodation to sanyasis and Bandhus who visit holy places for spiritual and charitable purpose. b) providing food & accommodation to Guru Bandhu for religious functions. 3. The assessee trust applied for registration u/s 12AA on 11.09.2017 and for getting certificate as provided u/s section 80G(5)(vi) of the Act. The Ld. CIT(E) rejected both the applications vide order dated 23.03.2018. Assessee's application u/s 12AA of the Act was rejected for two reasons a) that the trust is a newly created and registered with the Registrar of Public Trust on 31.07.2017 and b) No charitable activity carried out so far. 4. Aggrieved assessee is now in appeal before the tribunal challenging the rejection of assessee's application u/s 12AA & u/s 80G(5)(vi) of the Act. 5. Ld. counsel for the assessee vehemently argued commonly for both the appeals placing relevant following decisions: "Delhi High Court in DIT vs. Foundation of Ophthalmic & Optometry Research Education Centre (2013) 355 ITR 361/21....

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....ed the records placed before us. The assessee is aggrieved with the order of Ld. CIT(E) for rejection of application u/s 12AA and also rejecting application of Form No.10G made for grant of approval u/s 80G(5)(vi) of the Act. We observe that in the impugned order Ld. CIT(E) has not questioned the genuineness of the objects mentioned in the trust deed. Therefore, so far as the objects of the assessee trust mentioned in the trust deed page placed at 5 & 6 of the paper book have been considered to be charitable in nature. CIT(E). For better adjudication of the issue we will take to mention the objects appearing in trust deed: (a) To construct, open build rebuild, equip, take over conduct maintain equip start and grant aids to a "Dharmashala Ashram etc of Similar nature to provide accommodation for "Sanyasis" and Guru Bhandus when they visit holly place "Omkareshwar" for spirituals & Charitable purposes. (b) To provide good and accommodation to Gurubandhu's for purnima religious junctions like "Shiverataries", Guru Purnima, Nanmautssave, Janmashtami, Holi Purnima, 25 December Utsam, Kirtan, Bhandaras etc. as per established by Sadguru Swami Shri Vidhyanand Saraswati. (c) Trust s....

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....cation for registration of the trust or institution in the prescribed form and in the prescribed manner to the CIT before the 1st day of July,1973 or before the expiry of a period of one year from the date of the creation of the trust or the establishment of the institution whichever is later and such trust or institution is registered under s. 12AA : Provided that where an application for registration of the trust or institution is made after the expiry of the period aforesaid, the provisions of the s. 11 and s. 12 shall apply in relation to the income of such trust or institution,- (1) From the date of creation of the trust or the establishment of the institution. If the CIT is, for reasons to be recorded in writing, satisfied that the person in receipt of the income was prevented from making the application before the expiry of the period aforesaid for sufficient reasons; (ii) Where the total income of the trust or institution as computed under this Act without giving effect to the provisions of s. 11 and s. 12 exceeds fifty thousand rupees in any previous year, the accounts of the trust or institution for that year have been audited by an accountant as defined in Explanat....

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....een given a reasonable opportunity of being heard." 8. Sec. 12A of the Act prescribes conditions for registration of the trust whereas s. 12AA of the Act prescribes the procedure for registration. A careful reading of the relevant provisions would reveal that application for registration under s. 12A has to be made in Form No. 10A prescribed by r. 17A before the expiry of one year from the date of creation of the trust or establishment of the institution whichever is later. The application has to be made by a person in receipt of income of the trust. Thus while dealing with the application for registration the CIT has to examine whether the application is made in accordance with s. 12A r/w r. 17A and whether Form No. 10A has been properly filled up. He may also examine whether objects of the trust are charitable or not. Sec. 12AA nowhere provides that CIT while considering the application for registration is also required to examine whether the income derived by the trust is being spent for charitable purposes or the trust is earning profit. The language employed by the legislature in s. 12AA only requires that activities of the trust or institution must be genuine which should b....