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2018 (2) TMI 874 - AT - Income TaxEligibility to registration of the trust u/s 12AA - denial of claim stating that the trust is formed merely for complying the CSR requirements of the settler - proof of charitable activity - Held that:- A profit making Company can grant certain donation to the charitable trust, how can the activities of the trust become not charitable with this act. The fact that the CSR expenditure are not allowable expenditure under section 37 of the Act is relevant only for the taxability of the company incurring such expenditure. From the perception of the assessee trust the amount received as donation whether will be eligible for exemption under section 11 depends on the application of such fund for the charitable activities by the trust only. CIT is empowered to satisfy himself only about two factors i.e. the objects of the trust and the genuineness of the activities of the trust or institution and such powers does not extend to the eligibility of the trust/ institution for exemption u/s 11 r.w.s 13 which falls in the domain of the AO. Once the CIT has not doubted about the genuineness of the activities of the assessee nor doubted its charitable object, his powers under section 12AA end. We direct the CIT to grant the registration u/s 12AA and also the approval u/s 80G(5)(vi) - Decided in favour of assessee.
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