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2020 (8) TMI 49 - AT - Income TaxExemption u/s 11 - denying registration u/s. 12AA and denial of approval u/s. 80G - Charitable activity u/s 2(15) - assessee is a Society registered under the West- Bengal Societies Registration Act, 1961 - HELD THAT:- It is settled law that at the time of registration, the authority need to satisfy himself that the objects are charitable in nature and the activities being carried out are genuine, meaning thereby that the activities are in consonance for achieving the charitable objects and nothing else. Since we have seen from the objects of the assessee society that “education” one of the main objects which is a charitable object/activity as per the definition of charitable activity in section 2(15) and the genuineness of the society stands established by the assessee which is running educational institutions, which imparts engineering courses and is recognised by the All India Council for Technical Education as well as established Polytechnic College, we are of the considered opinion that assessee society was eligible for grant of registration u/s. 12AA Assessee society ought to have been granted the registration u/s 12AA of the Act, as per the settled position of law regarding grant of registration of section 12AA which the Ld. CIT, Durgapur erroneously has not given, therefore, his order is erroneous and also considering the fact that so many years have passed after the assessee has submitted the application/rejection of the application by the Ld. CIT, Durgapur and assessee is still running educational institution it would be a travesty of justice, if we remit the matter back to the Ld. CIT for fresh consideration. Direct the Ld. CIT/the competent authority to grant registration u/s. 12AA of the Act as per section 12A(2) of the Act, which states that where an application has been made on or after the 1st day of 1st June, 2007, the provisions of section 11 & 12 shall apply in relation to the income of such trust or institution from the assessment year immediately following the financial year in which such application is made. So, since the assessee filed application for registration u/s. 12AA of the Act on 17.08.2012, the provisions of section 11 and 12 shall apply in relation to the income of such assessee society from the assessment year 2013-14 (FY 2012-13). Grant of approval for registration u/s. 80G - CIT has not discussed anything about merits for denying the claim and has simply re-produced the order rejecting assessee’s application for registration u/s. 12AA of the Act, so we are unable to ascertain whether the assessee satisfies the conditions stipulated u/s 80G (5) read with Rule 11AA of the Rules - We remand this issue back to Ld CIT/competent authority to examine whether the assessee satisfies the conditions stipulated u/s 80G (5) read with Rule 11AA and if the Ld CIT/competent authority is satisfied, then assessee to be granted approval u/s 80G of the Act from FY 2012-13 i.e. AY 2013-14 - Appeal of assessee is partly allowed and for statistical purpose.
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