TaxTMI 
TaxTMI 
2025 (10) TMI 1349
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....i) of the Act. 3. That the learned C1T(E) has erred in law and on facts in cancelling the registration u/s 12A with retrospective effect from AY 2010-11 onwards. The Ld. AR advanced arguments and filed written submissions supporting the case of the assessee. The Ld. CIT-DR, on the other hand, referred to the findings of Ld. CIT(E) in the impugned order. Having heard rival submissions and upon perusal of case records, the appeal is disposed-off as under. Proceedings before Ld. CIT(E) 2.1 The assessee is stated to be a Punjab State Government Undertaking and it was constituted by an act of Punjab Government in the year 2002 vide notification No.12/108/2002-3TC/1490 dated 14-08- 2002. The assessee was registered u/s 12A vide order dated 02-07-2008. In the new regime of registration, the assessee was granted registration u/s 12A(1)(ac)(i) on 06-04-2022 from AYs 2022-23 to 2026- 27. The main objects of the assessee have been enumerated by Ld. CIT(E) in para-2 of the impugned order. The assessee strives to conserve, preserve, disseminate and document cultural heritage of Punjab and to conserve and renovate heritage properties in Punjab. The assessee also strives to s....
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....tural heritage. There were 94 protected monuments / buildings / forts / tombs / war memorials under the Department of Tourism and Cultural Affairs, Government of Punjab. The assessee acted as an executing agency for preservation, conservation, restoration and maintenance of the said notified monuments as ordered by the Government of Punjab. The detailed list of the same and various notifications as issued there-under was furnished by the assessee. The said activity was stated to be done on case-to-case basis from time to time under technical supervision of experts. The assessee also contended that its activities would also be covered under 'education' limb of Sec. 2(15). 2.4 With respect to running of fuel stations, it was stated that it was only an ancillary activity being carried out of compulsion due to circumstances arising since 1994. These fuel stations were set up to provide fuel support to the public at large during the troubled and disturbed times in Punjab in 1994 as there were lot of incidents of looting cash and disruption. Essential commodities including petrol and diesel were not available in times of needs specifically in the outskirts of the above towns to the ge....
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....was granted as per amended statutory provisions as applicable from AY 2022-23 onwards. The assessee also contended that Sec.12AB(4)(a) was not applicable prior to 01-04-2022. Further, it has not done any violations as alleged and accordingly, opposed any such action by placing reliance on various judicial decisions. The attention was drawn to the fact that two regular assessments were framed by the department against the assessee for AYs 2011-11 and 2012-13 wherein the department had accepted that the assessee's Board was a charitable public trust and it complied with all the requirements of claiming exemption u/s 12A. In these years also, the assessee was operating these fuel stations. 2.6 However, Ld. CIT(E) held an opinion that operation of fuel stations was neither incidental nor ancillary to the stated objectives of the assessee-trust. There was no reference in the trust deed to carry out such activities. This activity was fundamentally incompatible with the trust's charitable purpose and it could not be termed as incidental activity. The significant portion of income was derived by the assessee from running of petrol pumps. As per Clause (a) of Explanation to Sec. 12AB(4)(....
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..../s 12A since July, 2008. In the new regime of registration also, the assessee has been granted registration u/s 12A(1)(ac)(i) on 06-04-2022 from AYs 2022-23 to 2026-27. The main objects of the assessee-trust, inter-alia, include conservation, preservation, dissemination and documentation of cultural heritage of Punjab. The assessee also undertakes to conserve and renovate heritage properties in Punjab and also strives to setup and promote tourism infrastructure such as conference centers, auditorium, museums, libraries, hotels etc. As per its objects, the assessee could acquire, purchase, exchange, transfer, lease out or hold or dispose of property and could enter into contracts in pursuance of the functions assigned to its Board. The assessee is enjoying the exemption as applicable to charitable trust since the FY 2008-09. In fact, the assessee was subjected to regular assessment proceedings for AYs 2011-12 & 2012-13 wherein the department accepted the charitable character of the assessee and accepted the exemption claim of the assessee despite the fact that there was no change in assessee's substantial activities since then. The activities of the assessee are primarily covered un....
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....on the fact that the surplus so derived by the assessee has always been utilized towards attainment of charitable objects of the assessee. On these facts, it could be well said that the whole circumstances leading to running of petrol pump was not guided by profit motive but driven out of compulsion as explained by the assessee. These pumps could not be construed as separate business of the assessee but was to be construed as incidental or ancillary to assessee's main objects i.e., 'education' and 'preservation of monuments or places or objects of artistic or historic interest'. Therefore, the findings of Ld. CIT(E) could not be sustained. 5. Proceeding further, we find that as per extant provisions of Sec.12AB as applicable from 01-04-2021, the appropriate authority could cancel the registration of the assessee, inter-alia, upon noticing occurrence of one or more specified violations during any previous year. After considering assessee's replies, the appropriate authority may cancel the registration for such previous year and all subsequent previous years if he is satisfied that one or more specified violations have taken place. The Explanation to this sub-section enumerate spe....