TMI Blog2011 (4) TMI 563X X X X Extracts X X X X X X X X Extracts X X X X ..... granted earlier under section 12A(a) - The question in affirmative in favour of the assessee and against the Revenue. - ITA NO. 54/2011 - - - Dated:- 4-4-2011 - M.L. MEHTA, A.K. SIKRI, JJ. JUDGMENT M.L. Mehta, J. (Oral) ‑ This is an appeal directed against the order dated 12.3.2010 of the Income-tax Appellate Tribunal (hereinafter referred to as the "Tribunal") whereby the order dated 30th June, 2009 of the Director of Income-tax (Exemptions) passed under section 12AA(1)(b) read with section 12A of the Income-tax Act, 1961 (for short "the Act") was set aside and the appeal of the assessee was allowed. By the impugned order, the Tribunal also restored the registration granted to the assessee under section 12A of the Act. 2. The facts in brief are like this. The assessee Trust was created on the basis of the will left behind by the Settler late Lala Ram Khairati Ram. It got registration under section 12A of the Act in December 1974. Based on this, the assessee got exemption of the income tax in the assessments under section 143(3) for the assessment years 1996-97 to 2005-2006. It was in the assessment year 2006-2007, when the assessee filed return seeking ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s charitable trust/institution under section 12A(a) of the Act, as made in Form 10A, and also registration granted under the said provision, namely, section 12A(a) of the Act. That being so, the only question that calls for consideration is, as to whether registration so granted under section 12A(a) could not be cancelled/withdrawn by the Revenue under section 12AA(3) of the Act as submitted by the learned counsel for the assessee? On the other hand, it was submitted by the learned counsel for the Revenue that if after the grant of registration under section 12A(a), the Authority is satisfied that the conditions prescribed under the said section are not satisfied, registration could be withdrawn under section 12AA(3) which came to be inserted by Finance (No.2) Act, 2004 with effect from 1st October, 2004. He submitted that under the law, the Authority, which is entitled to grant registration, is equally entitled to withdraw such a registration, just as power of granting registration is available so is the power of withdrawing. 5. There is also no dispute that the registration, which is sought to be withdrawn by the Authority, is by virtue of power vested in the Commissioner under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ordance with the objects of the trust or institution, as the case may be, he shall pass an order in writing cancelling the registration of such trust or institution:" 6. At the outset, it may be pertinent to note that the title of section 12A "Conditions for applicability of sections 11 and 12" was substituted with effect from 1st June, 2007 in place of previous title "Conditions as to registration of the Trusts etc.,". It means that prior to 1st June, 2007, this section itself provided conditions regarding registration of trust etc. It is noted here because with the substitution of the present title, this section no longer provides for registration of trust etc. A special provision has been enacted in section 12AA providing for procedure for registration of trust etc. with effect from 1st April, 1997. It is also noted that section 12A was inserted in the statute book by the Finance Act, 1972 with effect from 1st April, 1973. It was omitted and was again restored with effect from 1st April, 1989 section 12A, as it stood at the time when it provided for registration of trust, nowhere provided for cancellation of the registration once granted. It is also pertinent to note that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... clause (a) or clause (aa) of sub-section (1) of section 12A). But this power of cancellation of registration obtained under section 12A came to be incorporated by way of amendment introduced by the Finance Act, 2010 with effect from 1st June, 2010. That being the interpretation of sub-section (3), it is amply clear that the power to cancel the registration once granted was only confined to the registration granted under clause (b) of sub-section 1 of section 12AA till before 1st June, 2010. Of course, now with effect from 1st June, 2010, the power vests with the Commissioner even to cancel the registration granted under any of the clauses of sub-section (1) of section 12A. In that view of interpretation, we are of the considered view that there was no power vested with the Commissioner to cancel or withdraw the registration granted to the assessee under section 12A(a) in the year 1974. 8. Similar question also arose before the Allahabad High Court in CIT v. Manav Vikas Avam Sewa Sansthan, ITA No.161/2007 decided on 24th February, 2010, wherein the reliance was placed in the case of Lucknow Bench in Oxford Academy for Career Development v. Chief Commissioner of Income-tax, Luckno ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
