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2016 (2) TMI 1091 - AT - Income TaxRejecting application for the registration u/s 12AA - genuineness of donation and unsecured loans - Held that:- The genuineness of loans taken and the donation received are matters to be examined during the assessment proceedings after grant of registration and necessary action relating to the same can be taken during the assessment proceeding for which there are specific provision of law in this regard. It must be remembered that the purpose of granting registration under section 12AA of the Income Tax Act is only to ensure that the assessee society has been formed for the purpose of carrying out charitable activity and is also actually carrying out the same so as to make it eligible to claim exemption under section 11 of the Act. As long as the said objects of an assessee society are found to be charitable and genuine and as long as the assessee society is carrying out the said objectives genuinely the registration under section 12AA cannot be denied. In the present case we find that the assessee society came into existence on 05/08/2010, for setting up educational institutes and other charitable purpose and acquired land for setting up a Nursery School on 31/07/2013. On 21/07/2014 it paid fees for approval of its construction plan on the impugned land, to the concerned authority. It is evident therefore that the assessee society was in the process of setting up educational institution and as held by the jurisdictional High Court, in such circumstances it could not be denied registration u/s 12AA for not carrying out any charitable activity. - Decided in favour of assessee.
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