2022 (5) TMI 330

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....1. Cancellation of registration under s.12AA(3) The learned DIT(E), Mumbai erred on facts and in law in passing the impugned order dated 27thMarch,2014, passed under s.12AA(3) of the Act cancelling registration granted unders.12A.A/12A of the Act. The registration may be restored by annulling the impugned order. 2. Cancellation of registration with retrospective effect Without prejudice to other Grounds of Appeal, the learned DIT(E); Mumbai, erred in law incancelling registration by order dated 27'* March,2014, with affect from 1stApril,2002. 3. Cancellation of registration based on Proviso to s.2(15) Without prejudice to other Grounds of Appeal, the learned DIT(E), Mumbai erred incancelling ....

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....lation to trade, commerce or business for Cess or fees or any other consideration, irrespective of nature of use or application or retention of the income from such activity and thus as per the amended proviso u/s 2(15) it is no longer remains charitable in nature. Thus the Director of Income Tax (Exemption) cancelled/withdrawal registration granted u/s 12AA(3) w.e.f. the date on which the registration was granted i.e. 01.04.2009. 4. Being Aggrieved by the order of the Director of Income Tax (Exemption), the assessee is before us. The Ld. AR submitted that the nature and purpose as well as the object of the Slum Rehabilitation Authority had no point of time has changed which has been duly taken note by the Director of Income Tax (Exempti....

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....rd both the parties and perused all the materials on record. It is pertinent to note that the DIT (E) nowhere in the order dated 27.03.2014 observed that the activities of the Slum Rehabilitation Authority are not genuine or that the activities carried out are not in accordance with its objects. The requirement for rejecting the registration under Section 12AA(3) is that if the trust or institution is carrying out non-genuine activities and the activities beyond the scope of its defined objects. But in the present case, the DIT(E) has not pointed out any such violation of the conditions. The DIT(E) is solely stated that the assessee is generating huge income by charging premium which over and above and the amount is invested in Fixed Deposi....

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....inded". The application of proviso to Section 2(15) is to be thus done on a year to year basis, while the grant of registration is a one time exercise." The Hon'ble Bombay High Court in case of Mumbai Metropolitan Region Development Authority (supra) held as under: "28. In North Indian Association (supra) this court in similar circumstances observed that there is difference between registration and exemption. Referring to Section 13(8) of the Act which was introduced by the Finance Act, 2012 with retrospective effect from 1st April, 2009 this court held that where the receipts are hit by the proviso to Section 2(15) of the Act, the benefit of exemption to its income for the relevant previous year would not be available. Thus inc....