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2021 (3) TMI 807 - AT - Income TaxRejection the Application for Registration u/s. 12AA - nature of contributions made by the pharmaceuticals companies terming the same as “sponsorship” and also holding that such contributing companies also deducting TDS on their such sponsorship contributions and therefore same being largely driven by their object of maximizing the profits of the sponsors/sponsoring entities and any activities so conducted with such sponsorships cannot be termed as charitable activities - HELD THAT:- Since, Section 12AA of the Act pertains to registration of the trust and not to assess of what a trust has actually done, we are of the view that the term ‘activities’ in the provision includes ‘proposed activities’. That is to say, a Commissioner is bound to consider whether the object of the Trust is genuinely charitable in nature and whether the activities which the Trust proposed to carry on are genuine in the sense that they are in line with the objects of the Trust. In contrast, the position would be different where the Commissioner proposes to cancel the registration of a Trust under sub-section (3) of Section 12AA. There the Commissioner would be bound to record the finding that an activity or activities actually carried on by the Trust are not genuine being not in accordance with the objects of the Trust. Similarly, the situation would be different where the trust has before applying for registration found to have undertaken activities contrary to the objects of the Trust. As far as the facts of the present case are concerned, the objects of the Trust were not considered by the ld. CIT(E), therefore, we are of the view that overall scheme and theme of the activities which are undertaken by the appellant is to make people at large aware of Cancer diseases, its dangers and what preventive care against the same was possible. Therefore, at the time of issue of granting registration, the only basis which is required to be considered is the overall objects of the Trust and its overall intent and not the basis of resources to carry out such activities or an outcome of any such activities of charitable nature undertaken without any intent or purpose of profit. Therefore, keeping in view our above discussion, we set aside the order passed by the ld. CIT(E) and direct him to grant registration u/s 12AA of the Act to the appellant. However, in case at a later stage, after granting registration, if it is found that the activities of the appellant actually carried out by the Trust are not genuine, being not in accordance with the objects of the Trust, then in that eventuality, the ld. CIT(E) is at liberty to invoke the provisions of sub-section (3) of Section 12AA of the Act independently - Appeal of the assessee is allowed.
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