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2021 (7) TMI 1129 - AT - Income TaxExemption u/s 11 - rejecting the application u/s 12AA - HELD THAT:- In the case of Commissioner of income tax versus Baba Kartar Singh Dukki Education Trust [2013 (10) TMI 1175 - PUNJAB & HARYANA HIGH COURT] as held that the object of section 12AA of the Act is to examine the genuineness of the objects of the Trust and though while examining genuineness, the income as well as resources of the Trust may be taken into consideration but any suspicion cannot be the sole criteria for rejecting an application for registration u/s 12 AA of the Act. In the case of Saint Kabir Educational Trust [2010 (3) TMI 1093 - ITAT AMRITSAR] as held that the scope and nature of enquiries at the stage of grant of registration are prescribed under section 12AA of the Act, therefore the CIT has no jurisdiction to conduct inquiries which falls beyond the scope of the statutory provisions. While granting registration to a charitable Trust or institution, the CIT is supposed to examine whether or not the objects of the Trust are charitable. When genuineness of the activities is not in doubt, the CIT has no jurisdiction to refuse registration u/s 12AA of the Act on any irrelevant ground. As pointed out by the Ld. counsel, in the present case, after examining the issue as per the order of the ITAT, the Ld. CIT(E) has not recorded any adverse observations in the impugned order in respect of the charitable activities carried out by the appellant Trust. So far as the Tax liability in respect of the corpus donation is concerned the same was not the issue for determination before the Ld. CIT(E) as the same has already been dealt with by the coordinate Bench in the first round of appeal and no direction was issued to look into the said issue. Hence, we find merit in the contention of the Ld. counsel that that since the Ld. CIT(E) has not given any adverse finding in respect of the charitable activities carried out by the assessee Trust, the Ld. CIT(E) ought to have granted registration to the appellant Trust. Hence, in our considered view, the impugned order is erroneous and therefore liable to be set aside. We therefore, respectfully following the ratio laid down in the cases discussed above, allow the appeal of the assessee and set aside the impugned order dated 12.03. 2020 and direct the CIT(E) to grant registration under section 12AA of the Act to the appellant Trust. - Decided in favour of assessee.
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