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2016 (3) TMI 30 - HC - Income TaxEligibility for registration in terms of Section 12A - Held that:- The amount allegedly collected as capitation fee from four prospective students was actually collected as tuition fee on the basis of the valid agreements entered into by the Trust undertaking to return the same in case admission under the NRI quota could not be made available to the concerned students. The amount so collected represented only a portion of the tuition fees which the Government had permitted the recognized medical colleges to collect during the relevant academic year and the agreement specified that the amounts could be adjusted towards the tuition fees payable by the students under the NRI quota. It is further stated that even with regard to amounts collected from employees, the same were voluntary deposits made by employees and no action had been taken by any authority against the Trust, since there was no compulsion or illegality in the matter. Going by the provisions of Sections 12A and 12AA of the Income Tax Act, we hold that the grounds raised by the registering authority and upheld by the appellate authority for rejection of registration to the appellant Trust cannot be sustained. The authorities could have examined only the genuineness of the Trust and its activities. They did not have material to hold that the Trust was either not genuine or its activities were not what was professed in the deed of Trust. Resultantly, in the light of the above findings, the impugned order is set aside. The respondent Commissioner of Income Tax is directed to grant registration as requested by the appellant Trust in terms of Section 12A of the Act. - Decided in favour of assessee
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