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2020 (9) TMI 196 - AT - Income TaxExemption u/s 11 - Providing education through Medical College - inadequate infrastructure - Pr. CIT has withdrawn the registration granted to the assessee u/s 12AA of the Act by invoking section 12AA(3) with retrospective effect - HELD THAT:- PCIT did not have record of activities which are not in accordance with the objects of the trust. The entire order of the PCIT is based on the appraisal report of DDIT( Inv.) only. We do not find mention of any material being referred by the ld. PCIT and its applicability to any of the provisions of Section 2(15 ) and/or Section 12AA(3 ) while revoking the registration. The Act envisages where a trust or an institution has been granted registration u/ s 12AA(1 )(b) or has been obtained registration at any time u/ s 12A. PCIT can cancel the registration if the conditions mentioned therein are not satisfied or the activities of the trust are not genuine or the activities are not carried out in accordance with the objects of the trust. We do not find that the ld. PCIT has brought out any of the conditions laid down as above. There have been deficiencies in the infrastructure as found by the first report which were found to have been rectified by the second committee comprising of Addl. Secretary, Go I Dean AIIMS, Addl. DG, DGHS, and keeping in view the fact that MCI has granted due permission for the academic session 2010-11, keeping in view the fact of non- sanction of prosecution of Sh. Ketan Desai, keeping in view the order of the Hon’ble High Court of Delhi, dropping the proceedings till sanction is received, keeping in view the submission of the revenue that no prosecution is pending against the assessee as on now, keeping in view the aims & objects of the trust are in consonance with the provisions of Section 2 (15 ) there has been no violation of clause (ii) para 4 of the trust deed as alleged by the ld. PCIT, we hereby hold that the order of the ld. PCIT dated 27 .10 .2017 cancelling the registration since inception, u/s 12AA(3) of the Act is legally not valid. 1) The order of the ld. PCIT cancelling the registration since inception is hereby revoked. 2) The order has been passed in accordance with the provisions of the Income Tax Act, 1961 and shall not impact the outcome of any proceeding under any other Acts promulgated under Constitution of India. 3) The revenue shall be at liberty to approach the Tribunal for re-institution of the appeal on re-commencement of trial against Sh. Ketan Desai which has been since dropped. - Appeal in favour of assessee.
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