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2015 (7) TMI 85 - AT - Income TaxRegistration u/s 12AA(3) withdrawn - genuineness of purchase of software or mere accommodation entry - validity of statement of various persons recorded during investigation - Held that:- In the present case, the activities of the assessee-trust which are mainly of imparting education to the students under various institutions referred in the order of learned CIT, Jalandhar-II, Jalandhar, have been found to be genuine and no allegation regarding not imparting of education has been framed by learned CIT, Jalandhar-II, Jalandhar, in its order passed under Section 12AA(3) of the Act or by the Assessing Officer in his order passed for the assessment years 2004-05 & 2009-10, referred hereinabove. The activities of the trust are found to be genuine and according to us the activities of the trust are genuine and cannot be said to be for non-charitable purposes, especially that there is not even a whisper from learned CIT, Jalandhar-II, Jalandhar, with regard to the non-genuineness of the activities of the trust which are found to be in consonance with the objects of the trust and therefore, the learned CIT, Jalandhar-II, Jalandhar, is not justified in cancelling and withdrawing the registration granted under Section 12AA of the Act i.e. w.e.f. the assessment year 2004-05. In the present case, learned CIT, Jalandhar-II, Jalandhar, has not brought on record any materials that the activities of the trust are not genuine or are not being carried out in accordance with the objects of the trust. Thus, the order of learned CIT, Jalandhar-II, Jalandhar, cancelling the registration is bad in law and, therefore, is set aside. The aforesaid statement recorded by the Department was whether under threat of tax liability of 100 crores is not evidenced by any documentary evidence by learned A.R. In the present issue, the assessee has submitted the explanation vide letter dated 14.09.2012 available at page 8 to 10 of the order of learned CIT, Jalandhar-II, Jalandhar, in which it was stated that the software purchased from Washington Software Limited though debited to various institutions, is installed in the central server at the head office of utmost importance and required secrecy. The software includes various modules and various types of reports which include data of students and also about the institutions. It generates reports which are very big and contain large number of pages. Some of the reports were produced before the learned CIT, Jalandhar-II, Jalandhar, and are available on record. Such reports have been stated to be wrong by learned CIT, Jalandhar-II, Jalandhar. The assessee, for supplementing his contention, has enclosed the report of Trident Information System Pvt. Ltd. certifying that the software were duly installed in the central server at the head office and the said report is available on record as mentioned hereinabove. It was argued that the said software system has generated the reports right from 2004 to 2011.In this regard and keeping in view the facts and circumstances as above, it cannot be a case for withdrawal/cancellation of registration granted under Section 12AA(1) of the Act - Decided in favour of assessee.
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