TaxTMI 
TaxTMI 
2021 (4) TMI 731
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....al Institution through different units i.e. Institute of Science & Technology (IST), Primary Teachers'Training Institute (PTTI) and Bengal College of Teachers'Education (BCTE) under the aegis of Gopsai Avinandan Sangha (GAS), which is the head office. Application for registration under section 12AA was rejected vide orders dated 03. 07. 2013 by the ld. CIT, Kolkata-XIX. Appeal was filed before the ITAT, 'B'Bench, Kolkata in ITA No. 2244/KOL/2013. Further application for registration under section 12AA was rejected vide orders dated 31.10. 2014 by Ld. CIT, Kolkata- XIX. The assessee filed appeal before the ITAT, 'B'Bench, Kolkata in ITA No. 2156/KOL/2014. ITAT, 'B'Bench, Kolkata passed a consolidated order dated 03.01. 2018 adjudicating that, the eligibility of the assessee for registration under section 12AA and approval u/s 80G(5)(vi) of the Act has to be decided on merits rather than on the basis of default by the assessee setting aside the orders of the ld. CIT, Kolkata-XIX. Consequent upon the order of the ITAT, 'B'Bench, Kolkata, ld. CIT (Exemptions), Kolkata issued a show cause notice dated 30. 08.2019 requisitioning either queries which are all regarding application of incom....
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....here in which Trust fund was not utilized for education purposes. (ix) Huge expenditure was incurred on advertisement, hence it was inferred that the trust was running commercial activities. (x) Expenditure on placement was found to be non- educational activity. (xi) Suppression of receipts was found in the accounts of the Trust; (xii) Fund of the Institution was also withdrawn for personal purposes from several reserve funds during the FY 2010- 11. (xiii) Corpus donations were nothing but the fee charged had to be required to be included in the gross receipts. 4. The assessee submitted as follows on each of the above objections to CIT(Exemptions) point- wise:- "A letter No. 3961 dated 13.03.20 \ 3 was issued making requisition to furnish some details specified therein fixing the hearing on 09.04.2013. The said requisition did not require production of books of accounts with supporting evidence(s). Your assessee on the specified date of hearing appeared and filed an adjourned petition describing the reason as to why it was not possible for us to comply the furnishing of requisitioned details. Pertinent to mention here that al....
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....an 16 (Mad). In the instant case of your appellant, we have made the application for registration u/s. l 2 A in t ime and all the books of accounts of our Society had been maintained in the manner as suggested by the provisions of the Section - 12 A. 2.. While considering granting of registration u/s. l 2 AA, your honour shall satisfy yourself only about genuineness of activities of the Institution in accordance with its objects. [Please refer the judgement of PIMS Medical & Education Charitable Society Vs. CIT (2013) 56 SOT 522 (Chd)]. It is also a settled law now that at the stage of granting registration, objects of the Society and not activities or purported utilization of its income for charitable purposes, has to be considered by the Commissioner [Please refer CIT Vs. BKK Memorial Trust (2013) 213 Taxman 1 (Punj & Har.) & DIT Vs. Meenakshi Amma Endowment Trust(2013) 219 Taxman 136 (Kar)]. Section 12 AA provides for a procedure to be followed for grant of registration to a trust or institution. The Commissioner shall call for documents and information and hold enquiries regarding the genuineness of the trust or institution. After he is satisfied about the cha....
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....d that the Applicant - Society has been engaged in the field of'Educational Activity'only. Copies of all such assessment orders are enclosed herein for your kind perusal and marked as page - 87 to 117. The relevant portion of each order (page nos. 87, 91, 98,104,109 & 114) is marked in fluorescent colour to prove the genuineness of our activities in the field of imparting education so as to corroborate our claim as well. We, once again, claim that the object of our Society is only education and thus genuine. Moreover, we also claim that the activities are always carried out in accordance with the objects of our Society. 3.. Kind attention of your honour is also ~ to the fact that proceeding u/s. 10 (23 C)(vi) of the Act is an independent proceeding and rejection of exemption u/s. 10 (23 C)(vi) cannot be made the ground for cancellation of registration u/s. 12 A of the Act. [Please refer the judgements of Institute of Marketing & Management Vs. CIT ITA No. 172 l/De I/2015 and CIT Vs. Jeevan Deep Charitable Trust ITA No. 471 of 2011 (All.) & CIT Vs. School of Management Sciences ITA No. 2 S1 of2011 (All.)]. 4.. Also your honour has instructed us to appear before you....
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....order (page nos. 87, 91, 98,104,109 & 114) is marked in fluorescent colour to prove the genuineness of our activities in the field of imparting education so as to corroborate our claim as well. We, once again, claim that the object of our Society is only education and thus genuine. Moreover, we also claim that the activities are always carried out in accordance with the objects of our Society". 6. Ld. CIT(Exemptions), Kolkata considered this explanation of the assessee and thereafter rejected the claim of the assessee for grant of registration under section 12AA of the Act. Being aggrieved, the assessee is in appeal before us. 7. The ld. Counsel for the assessee submits that the ld. CIT(Exemptions), Kolkata raised certain issue based on the observations in the order passed by the ld. Chief CIT while revoking registration granted under section 10(23)(v),(vi) of the Act and has not considered the finding of the Assessing Officer on those very issues which attained during the course of scrutiny proceedings for all the impugned assessment years. He filed copies of the assessment orders passed for the A.Ys. 2009-10, 2012- 13 as well as the orders of the ld. CIT(A) for the AY 2012-....
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.... not genuine. The ld. DR supported the order of the ld. CIT(Exemptions) and submitted that registration under section 12AA of the Act cannot be granted to the assessee. 10. Both parties agreed that ITA 233/KOL/2020 is consequential to the finding of the ITAT in the appeal ITA 232/KOL/2020 for granting registration. 11. Rival contentions heard. On a careful consideration of the facts and circumstances of the case, we hold as follows:- The ld. CIT(Exemption), while rejecting the assessee's claim for registration under section 12AA of the Act has stated as follows:- "I have considered the entire facts. The claim for approval u/s 12AA cannot be accepted for the following reasons:- (i) Although the Authorized Representative of the society has claimed that the money has been taken out in the name of trustees and other associations for the purposes of education, the evidences on record prove that it was taken for personal purposes and non-educational purposes. The claim of the society is based on a self- serving statement whereas the fact that money was siphoned off for personal use and non-educational purposes is a matter of record based on evidences collected ....
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....ed under section 143(3) of the Act, the Assessing Officer's categorical finding is that the assessee is engaged in educational activities. The ld. CIT(Exemptions) has also not alleged that the objects of the assessee are not charitable in nature. He was only guided by the findings of ld. Chief CIT by rejecting the grant of registration under section 10(23C) of the Act. The orders of the assessment passed under section 143(3) are the final finding of fact on the material found during the course of search or survey. There is no adverse inference recorded in these orders under section 143(3), on the material found during the course of survey. Hence no adverse inference can be drawn by the ld. CIT(Exemption) on the very same material. It is not a case where the ld. CIT(Exemption) has conducted an enquiry or verification on a case. The ld. CIT(Exemption) has not confronted with the assessee with the material found during the course of survey and adjudicated the issue after receiving the replies/rejoinders of the assessee. In fact, the assessee replied to the allegations made by the ld. CIT(Exemptions). The conclusion and facts can only be drawn by the Assessing Officer during the course....
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....17. In all these cases, it is laid out that the ld. CIT(Exemption) should examine whether the objects of the Trust or Institution are charitable in nature or not and as to whether the activities of the Trust/Institution are in consonance with these objects. We find that the objects of the Society are charitable in nature. We also find that the activities of the Society are in accordance with the objects. The Assessing Officers in their assessment orders have recognized these facts as is clear from the following findings:- Assessment order dated 27. 03.2015 for the assessment year 2012-13 in page 2 at para 1 :- "The assessee is a voluntary organization. It is engaged in imparting education through different units, i.e., (i) Institute of Science and Technology (IST), which is approved by AICTE and affiliated to WBUT & WBSCTE, offers post graduate as well as diploma course on different branches of science & technology. (ii) Primary Teachers'Training Institute (PTTI) affiliated to WBBPE, offers diploma in elementary education, (iii) Bengal College of Teachers'Education (BCTE), which is affiliated to Vidyasagar University, offers bachelor's degree in education. The thr....