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2011 (8) TMI 1322 - AT - Income TaxCharitable Institution u/s 12A - Tax deduction on donations u/s 80G - Enquiry u/s 80G(5) - Assessee, charitable institution, applied for renewal of the recognition u/s 80G. CIT while examing the approval under section 80G, the assessee has been denied the exemption u/s 11 & 12 by the Assessing Office HELD THAT:- In the case of SHIKSHAN PRASARAK MANDALI. VERSUS COMMISSIONER OF INCOME-TAX. [2008 (4) TMI 396 - ITAT PUNE-A], based on similar facts, CIT denied recognition under section 80G for the reason that the exemption under sections 11 & 12 had been denied to the assessee in the assessment proceedings. As per the Bench, such objection would not ipso facto militate against denial of recognition under section 80G as long as in principle and on a prima facie basis assessee complied with the conditions set out in section 80G(5)(i) to (v). Having regard to the observations of the Hon’ble Gujarat High Court in the case of NN. DESAI CHARITABLE TRUST VERSUS COMMISSIONER OF INCOME-TAX [1999 (5) TMI 11 - GUJARAT HIGH COURT], it is clear that in so far as the relevance of 80G(5)(i) is concerned, it is to examine the eligibility of the assessee applicant to claim that its income is not liable to be included in the computation of total income. The Hon’ble High Court emphasized that for the purposes of enquiry under section 80G(5), it is to be seen whether the Trust is registered u/s 12 or not. It has been specifically observed that, “Once a trust is registered under section 12A, its income from property, which includes donations whether covered under section 11(1)(d) or u/s 12 such donations are deemed to be income from property, is not to be included in its total income u/s 11 or section 12. In the present case, the objection raised by the CIT to deny the recognition u/s 80G is founded on irrelevant considerations by embarking upon an exercise which is only in the realm of assessment proceedings. Undeniably the assessee is registered u/s 12A and such registration continues. In this view of the matter, in our view, the assessee fulfils the condition prescribed under clause (i) of section 80G(5). There being no other objection raised by the CIT, we therefore proceed on the basis that the assessee has fulfilled all the conditions prescribed under clauses (i) to (v) and is thus eligible for renewal of recognition u/s 80G(5) - Decision in favour of Assessee.
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