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2014 (11) TMI 446 - ALLAHABAD HIGH COURTNature of Trust – Charitable or not – Held that:- The Tribunal has rightly relied upon Hardayal Charitable & Educational Trust Versus Commissioner of Income Tax-II, Agra [2013 (3) TMI 377 - ALLAHABAD HIGH COURT] wherein it has been held that the is that at the time of registration u/s 12AA of the Income Tax Act, which is necessary for claiming exemption u/s 11 and 12 of the Act, the CIT is not required to look into the activities, where such activities have not or are in the process of its initiation - Where a trust, set up to achieve its objects of establishing educational institution, is in the process of establishing such institutions, and receives donations, the registration u/s 12AA cannot be refused, on the ground that the Trust has not yet commenced the charitable or religious activity - Any enquiry of the nature would amount to putting the cart before the horse - At this stage only the genuineness of the objects has to be tested and not the activities, which have not commenced - The enquiry of the Commissioner of Income Tax at such preliminary stage should be restricted to genuineness of the objects and not the activities unless such activities have commenced - The Trust or society cannot claim exemption, unless it is registered u/s 12AA of the Act and thus at that such initial stage the test of the genuineness of the activity cannot be a ground on which the registration may be refused – the objects as provided in the object clause of the trust are charitable objects and are supported by other ancillary objects to which a detailed reference is not necessary – the order of the Tribunal is upheld – Decided against revenue.
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