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2006 (11) TMI 249 - AT - Income TaxDenial to Grant registration u/s 12AA(1)(b)(ii) - Charitable Trust - Objects and activities not genuine - CIT was of the view, that since the amount of Rs. 500 which was the initial contribution of the founder of the trust was too small and illusory, the necessary ingredient of the trust property was missing and the objects of the trust cannot be achieved with this paltry amount - HELD THAT:- The objects of the trust as declared in the trust deed, which we have extracted, are all charitable objects and there is no finding recorded by the CIT to the contrary. Be that as it may, the real objection of the CIT seems to be that the initial contribution of Rs. 500 made by the founder of the trust and dedicated to the objects of the trust is hardly sufficient to carry out the charitable activities of the trust. The sufficiency or otherwise, as rightly pointed out on behalf of the assessee, is not a relevant factor while dealing with an application for registration u/s 12AA. The section in terms does not make it a consideration for the grant of registration. The trustees have collected a sum of Rs. 5,71,927 towards contribution to the trust which has been deposited with the Punjab National Bank. The statement of account issued by the bank and which was placed before the CIT shows this figure as on 17th Sept., 2004. Therefore, there are sufficient funds available with the trust from which the charitable activities can be carried out. In our opinion, the CIT was not justified in refusing to grant registration to the assessee trust. The reasons given by him for such refusal are extraneous to s. 12AA. We may add that the CIT has not doubted the genuineness of the activities of the trust. Thus, CIT, in our opinion, was not justified in relying on this decision for refusing registration to the trust. Hence, we allow registration of the assessee trust, set aside the order passed by the CIT u/s 12AA and allow the appeal.
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