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2015 (10) TMI 932 - AT - Income TaxGrant of approval for the purposes of Section 80G - CIT(A) denied the claim - Held that:- So far as possibility of doing any commercial activity is concerned, which is substance of learned Commissioner's rejection of application, there is nothing in Section 80 G (5) which can justify rejection of application on that basis. All that Section 80G(5)(i) states is that "where the institution or fund derives any income, such income would not be liable to inclusion in its total income under the provisions of sections 11 and 12 or clause (22) or clause (22A) or clause (23) or clause (23AA) or clause (23C) of section 10". There are certain other fine points on this issue but there is no need to go into all those issues as undisputedly, there is no such income on the facts of this case. There may be a possibility of engaging in a commercial activity , with the help of 'community centre' the assessee is building, but this possibility, even if that be so, cannot be reason enough to decline the application for registration under section 80 G. Commissioner's action is a classic example of proceeding on the basis of surmises and conjectures and on the basis of irrelevant considerations. What Commissioner needs to do in such cases is very well elaborated upon in Rule 11 AA reproduced earlier in this order. Learned Commissioner, should, inter alia, examine (i) copy of registration granted under section 12A or copy of notification issued under section 10(23) or 10(23C); (ii) notes on activities of institution or fund since its inception or during the last three years, whichever is less; and (iii) copies of accounts of the institution or fund since its inception or during the last three years, whichever is less. In case learned Commissioner is not satisfied with such material, it is open to him to call for such further documents or information from the institution or fund or cause such inquiries to be made as he may deem necessary in order to satisfy himself about the genuineness of the activities of such institution or fund. In the impugned order, however, there is not even a whisper about the note on activities on the institution nor on why is the learned Commissioner not satisfied about facts set out in these notes and other information submitted by the assessee institution. Thus remit the matter to the file of the learned Commissioner for fresh adjudication - Decided in favour of assessee for statistical purposes.
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