TaxTMI 
TaxTMI 
TaxTMI 
2021 (10) TMI 415
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....berately not filed its return of income and thus violated the provisions of the Act. He observed that as per the amended Act, w.e.f. 01.04.2019, the compliance of law by a trust is mandatory. Therefore he observed the assessee has violated the law and therefore was not eligible for registration u/s 12A of the Act. He accordingly denied the registration u/s 12A of the Act against which assessee is in appeal before the Tribunal by raising the following grounds of appeal : "1. The Order of the Ld. Commissioner of Income Tax, Exemptions, Hyderabad, is erroneous and is not based on facts and circumstances of the case. 2. The Ld. CIT (Exemptions), Hyderabad , erred in not restricting his scope of enquiry to the objects of the University and the genuineness of the activities or the University. 3. The Ld. CIT (Exemptions), Hyderabad erred in rejecting the application of the University for recognition under Sec 12AA on the premise that the Returns of Income arc not filed by the University. 4. The Ld. CIT (Exemptions) erred in assuming that the filing of Returns of Income is sine qua non for granting of recognition under Section.12AA. 5. The Ld. CIT (Exemptions) erred in ignoring t....
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....x prior to the amendment and therefore it was under the impression that it is not required to file return of income and also not to seek registration u/s 12AA of the Act. As soon as the assessee became aware of the requirements of law, the assessee has complied with the same. He submitted that since the assessee has fulfilled basic conditions for grant of registration u/s 12AA of the Act, the CIT(E) has erred in denying the registration to the assessee and has caused gross injustice to the assessee. He submitted that similar issue had come up before the Tribunal in the case of Jawaharlal Nehru Technological University, Hyderabad Vs. CIT(E), Hyderabad and vide orders dt.27.04.2021 in ITA No.1769/Hyd/2019, the Tribunal has directed the CIT(E) to grant registration u/s 12A if the objects and activities of the assessee are charitable in nature. He sought similar directions in the case of assessee as well. 4. The learned DR, on the other hand, supported the order of the CIT(E). 5. Having regard to the rival contentions and the material on record, we find that the assessee is also state funded university as in the case of Jawaharlal Nehru Technological University (JNTU) (supra) and in ....
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.... 4. Taking the above facts into consideration, CIT (E) observed that: (i) the assessee has failed to file its audited accounts and failed to file the return of income for the earlier A.Ys and thus, the assessee has violated the provisions of the I.T. Act and therefore, it is not eligible for registration u/s 12A of the Act. (ii) The assessee has to apply its income only in India, but has failed this condition as it has spent Rs. 6,48,39,585/- outside India; and (iii) the assessee in its return of income has made a false claim of benefit u/s 11, even though it had not obtained the registration u/s 12A of the Act. 5. For all these reasons, the CIT (E) denied registration u/s 12A of the Act against which the assessee is in appeal before us by raising the following grounds of appeal: "1. The order of the Id CIT(Exemption) is contrary to the law and the facts. 2. The Appellant is a Charitable Institution Constituted by Enactment of the Government of Andhra Pradesh on 18/08/2008 for imparting Higher Education, Research, Scientific and Technical Education. 3. In accordance with the directions of University and Central Government, the Institution is imparting Advance Technol....
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....sessee is carrying on its activities strictly in accordance with the objectives. As regards the observation of the CIT (E) that the assessee has violated the provisions of section 11, he submitted that there is no violation, because the payment made by the assessee to the foreign university is not out of its own funds but was the fee collected by it from the students for their study outside India i.e. Blekinge Institute of Technology at Karlskrona, Sweden in terms of the Memorandum of Cooperation dated 16.10.2010 entered into by India with Sweden and was reimbursed to the said University. He further submitted that the non-filing of returns of income for the earlier years cannot be considered as a ground for denial of registration u/s 12A of the Act. He submitted that subsequently, the assessee had filed another form 10A on 25.11.2019 seeking registration u/s 12A of the Act and the CIT (E) has granted registration vide orders dated 24.6.2020 and made it applicable from the A.Y 2020-21 onwards. Therefore, the assessee sought a direction to the CIT (E) to grant registration also for the A.Y 2019-20. In support of his contentions that it is only the objectives of the Trust which are to....
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....y the Finance Act of 2014 requiring every business trust, which is not required to furnish its return of income or loss under any other provisions of this section, to furnish return of such income of the previous year in the prescribed form and verified in the prescribed manner or as may be prescribed and all the provisions of this Act shall so far as may be, apply as if it were a return to be furnished under sub section-1 of section 139 of the Act. We find that this amendment was w.e.f. 1.4.2015. 10. We also find that Rule 2BBB has also been introduced w.e.f. 12.12.2014 prescribing the percentage of govt. grant for considering a university, hospital, etc., as substantially funded by the govt. for the purposes of clause (23C) of section 10 and it provides that where the govt. grants to such university or hospital exceeds 50% of the total receipts including any voluntary contributions of such university or other educational institution/hospital or other institution during the relevant previous year, it shall be considered as substantially funded by the govt. for such previous year. Thus, it can be seen that though the assessee university was formed in 2008, till the A.Y 2014, it w....