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2008 (5) TMI 350 - AT - Income TaxCharitable Trust - refusal to grant certificate of registration u/s 12AA - deduction u/s 80G - date on which the registration shall be effective from - Whether the objects mentioned in trust deed 'to do milk business' falls under the definition of charitable purpose - Order of CIT(A) is against the principles of natural justice and is bad in law - application for condonation of delay - trust is claimed to be working for the help of weak and helpless cows - part of the land of the trust was sold to one Shri Madan Gopal, s/o Shri Niranjan Lal, r/o Gyan Gudri - Ld AR argued that the learned CIT has wrongly misconstrued this object and that in fact, it does not refer to any business activity but refers to proliferation of the cows and their service and in the process, if any profit is earned then that has to be used to fulfil the needs of the public. This also refers to charity and not income. HELD THAT:- In our considered opinion the learned CIT has misread this object. From the perusal of the trust deed it becomes clear that it is a charitable trust which is created to pursue the objects mentioned therein. None of the objects is for earning profit which can remove the trust from the definition of charitable trust under s. 12AA. The issue regarding exemption allowed by the CIT at the stage of granting or refusing the registration under s. 12A r/w s. 12AA of the Act the law is almost settled. While refusing application under s. 12A the CIT has to examine only two aspects i.e. genuineness of the activities of the trust/institution, and object of the trust/institution. Once there is no dispute about the genuineness of the activities the learned CIT cannot take shelter of any other outer source for refusing registration under s. 12A. It was held in the case of U.P. Awas Evam Vikas Parishad vs. ITO [2005 (7) TMI 668 - ITAT LUCKNOW] that "while disposing application u/s. 12A, CIT has to examine only two aspects viz., the genuineness of the activities of the trust and 'object of the trust'. Once there is no dispute about genuineness of activities, CIT cannot take shelter of any other outer source for refusing registration under s. 12A". In our considered opinion no case of refusal of registration has been made out by the CIT; and in view of the facts of the case and the objects of the trust, the assessee is entitled to registration. The learned CIT is, therefore, directed to grant registration to the assessee trust as per law. Date on which the registration shall be effective from - Application delayed by six years - reasons have been mentioned to be wrong advice/ignorance of law - The application for condonation of delay is placed at the paper book wherein ignorance of income-tax provisions has been pleaded as reason for the delay. It has also been pleaded that no significant activities were done by the assessee trust. By following the recent Supreme Court decision in the Motilal Padampat Sugar Mills Co. Ltd. vs. State of Uttar Pradesh & Ors.[1978 (12) TMI 45 - SUPREME COURT] held that ignorance of law can be taken as a reasonable excuse. We therefore, condone the delay. From this application it is found that the delay in this case was caused due to a reasonable cause: Therefore, learned CIT is directed to grant registration from the date of application for registration. In the result, appeal is allowed.
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