TaxTMI 
TaxTMI 
2020 (12) TMI 397
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.... by claiming itself as a Charitable and educational trust. The assessee e-filed application for its registration u/s.12A of the Act on 31-01-2019. The ld. CIT(E) called for certain details. On perusal of such details, he observed that during the last three financial years ending on 31-03-2016, 31-03-2017 and 31-03-2018, the assessee did not incur any expenditure on charitable activities. He further observed that the assessee had FDRs of Rs. 2.00 crore in the F.Y. 2015-16 but income was not declared in the Income and Expenditure Account. Similar position was found anent to the FDRs and income not offered for earlier years as well. That is how, the ld. CIT(E) came to the conclusion that the assessee did not satisfy the nature of activities a....
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.... the trust before granting any registration. 5. The contention of the ld. AR limiting the power of the ld. CIT(E) in not examining the activities of the trust before granting registration, in our considered opinion, is partly correct. There can be two situations, viz., first, where the trust is newly set up and seeks registration and second, where the trust is already set up and seeks registration after sometime. In the first situation, there can be no question of examination of genuineness of activities at the time of registration because the activities have not taken place and a trust is entitled in law to seek registration at any time even before undertaking the activities. In such circumstances, CIT(E) can examine the proposed activiti....
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....terest income was not fully routed through the Income and Expenditure account but 95% of the same was simply credited to the respective funds in the balance sheet and only 5% was taken to the Income and Expenditure Account. She tried to explain with reference to the assessee's balance sheet as on 31.3.2016 that the amount shown under the head "Add : Current" in the 3 funds represented interest income on FDRs in the proportion of 75%:10%:10%, which was taken directly to these funds. She further submitted that the term "Less - utilized" represented the amount of expenditure incurred on activities carried out for the purpose. It was her submission that 5% of interest income on FDRs was taken to the Income & Expenditure account. 7. Reflection ....