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TMI Blog2010 (8) TMI 757X X X X Extracts X X X X X X X X Extracts X X X X ..... er passed by the learned CIT under section 12AA(3) of the Act, the assessee has preferred the present appeal. While withdrawing the registration, the learned CIT has observed that during the course of proceedings of renewal of recognition under section 80G(5)(vi) of the Act in the case of the assessee, the following object of the society was found to be non-charitable in nature : "(iii)To establish hostels, cafeteria, Ran-basera, stores to provide accommodation and other facilities for 'persons in need.' Considering the above object, the learned CIT issued a show-cause notice to the assessee society for withdrawal of registration under section 12AA(3) of the Act. The notice dated 26th Feb., 2010 reads as under : 2. During the course of h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... your kind perusal." 4. The learned CIT has withdrawn the registration granted under section 12AA(1)(b)( i) of the Act to the assessee society, observing as under : "4. I have considered the submission of Shri Vipin Jain, FCA. From the reply it is clear that the society has admitted that the said objective is not charitable in nature as the society has amended the bye-laws and removed this particular objective. The argument of Shri Vipin Jain, FCA that no such activity has been carried out by the society is immaterial. As this particular object of the society was part of the memorandum of association of the society at the relevant time of grant of registration under section 12AA(1)(b)( i) of the Income-tax Act, 1961 to the society from 19t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... learned CIT that the assessee had accepted that one of its objects is non-charitable in nature is false, baseless and incorrect. According to the learned counsel for the assessee merely causing amendment to bye-laws to add/remove any object, cannot be deemed to conclude that the objects of the society were comprising of activities of non-charitable nature. Alternatively, Shri Abhinav Mehrotra, learned counsel for the assessee submitted that it is uniform judicial opinion that even if some of the objects of the society cannot be regarded as hardcore charitable in nature, but the majority of the objects of the society are charitable in nature, the benefit of section 12AA of the Act cannot be denied. 6. In support of Departmental case, Shri A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee society applied for registration under section 12AA(1)(b)( i) of the Act vide letter dated 31-3-2008 to the CIT-II, Lucknow and registration was granted vide order dated 19-9-2008. However, during the course of proceedings of renewal of recognition under section 80G(5)(vi) of the Act, the following object of the society was found to be non-charitable in nature : "To establish hostels, cafeteria, Ran-basera, stores to provide accommodation and other facilities for 'persons in need'." At the time of granting registration under section 12AA, the learned CIT did not raise any objection qua this object being of charitable in nature. Now, the question is as to whether the learned CIT was justified in cancelling/withdrawing the registra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CIT should be satisfied that the activities of the assessee society are not genuine or are not being carried on in accordance with the objects of the society and only then the CIT has power to cancel the registration granted to the assessee society. In our considered view, cancellation/withdrawal of registration by the learned CIT amounts to reviewing its earlier order. The CIT has no power to review its own order, except on twin conditions specified in sub-section (3) of section 12AA of the Act. In the case of K.M. Scientific Research Centre v. Lakshman Prasad [1998] 229 ITR 23 (All.), the Hon'ble jurisdictional High Court ruled that the power to review is not an inherent power. It must be conferred by law either specifically or by necess ..... X X X X Extracts X X X X X X X X Extracts X X X X
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