2015 (12) TMI 1642 - AT - Income Tax

Registration under Section 12AA(a) denied - application filed in the Form 10A - Held that - The assessee had filed application in Form No. 10A alongwith required details. The society is registered from 1998 under the Societies Registration Act. The copy of the society are charitable and activity are genuine. At the time of registration of Trust/Institution the ld CIT is to be judged the object of the Trust which should be charitable in nature as the assessee is imparting the education programme through college and school education programme and he also provided various charitable services to the society as per object of the Trust. The case laws relied by the assessee are squarely applicable in the case of the assessee accordingly order of the ld CIT is set aside the directed to grant registration from the financial year 2012-13 as per application filed in the Form 10A. - Decided in favour of assessee.

Summary

Issues:
1. Rejection of registration under Section 12AA of the Income Tax Act, 1961 by the Commissioner of Income Tax, Kota.
2. Appeal against the rejection of registration filed by the assessee.

Issue 1: Rejection of Registration under Section 12AA:
The appeal was against the rejection of registration under Section 12AA of the Income Tax Act, 1961 by the Commissioner of Income Tax, Kota. The Commissioner observed that the society failed to provide documentary evidence supporting its charitable activities during the relevant period. The Joint Commissioner of Income Tax, Range-1, Kota did not recommend the case for registration under Section 12AA. The society's application for registration was rejected under Section 12AA(1)(b) of the Act due to the absence of documentary evidence supporting charitable activities.

Issue 2: Appeal against Rejection of Registration:
The assessee, a registered society under the Society Registration Act, 1958, appealed against the rejection of registration. The society's main objective was to provide education through schools, colleges, technical education institutions, and libraries for the general public. It also engaged in charitable activities like donations, scholarships, election awareness campaigns, and tree plantation. The assessee argued that the rejection was unjustified as the Commissioner should only assess the trust's object and the genuineness of its activities, not its income or trustees. The assessee cited legal precedents to support its argument.

The Tribunal found that the society was registered since 1998 and engaged in genuine charitable activities, including educational programs and various services for the public. The Tribunal held that the Commissioner should assess the trust's charitable nature and activities during registration, as supported by the legal precedents cited by the assessee. Consequently, the Tribunal set aside the Commissioner's order and directed the grant of registration from the financial year 2012-13 as per the application filed in Form 10A.

In conclusion, the Tribunal allowed the assessee's appeal, emphasizing the importance of assessing the charitable nature of the trust's activities during registration under Section 12AA of the Income Tax Act, 1961.