TMI Blog2010 (9) TMI 782X X X X Extracts X X X X X X X X Extracts X X X X ..... - Held that that there was no power with the CIT at the relevant time to cancel the registration after having once granted it. Now, the power has been given to the CIT by inserting s. 12AA(3) by Finance Act, 2004 w.e.f 1st Oct., 2004 - As in the case Oxford Academy for Career Development [2008 -TMI - 34673 - ALLAHABAD HIGH COURT ] held that 2AA(3) has no retrospective effect - Decided that CIT has no power to cancel the registration under s. 12AA(3) as it has no retrospective effect - Appeal allowed - nothing to hold the activities of the appellant are not genuine or its activities are not carried out in accordance with the objects of the appellant - Appeal is allowed. - ITA No. 482 (Luck.) of 2010 - - - Dated:- 6-9-2010 - H.L. KARWA, A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee runs a school for the students of Class 1st to Class 12th in the name of Modern School. In its assessment order for asst. yr. 2007-08, the AO, for the reasons given in the assessment order, has held that the assessee has paid excessive lease rent to its founder-President and has also passed some resolution to benefit the founder-President. In the above premises, the AO has denied the benefit of tax exemption to the assessee under s. 11 of the Act. On the basis of findings given by the AO in the assessment order, the learned CIT came to the conclusion that the assessee was making over a large part of its income and even assets to Shri Rakesh Kapoor, the society's President for his personal consumption. The entire set up was so d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. It was also stated that the society is charitable in nature as defined in s. 2(15). The assessee also submitted that the only reason given by the AO for refusing benefit of s. 11 is that the society has paid excess lease rent to its founder-President and/or it has passed a resolution to transfer the school building to the founder-President in the year 2010. It was also submitted by the assessee that an appeal has been filed before the learned CIT(A) against the assessment order of asst. yr. 2007-08 and is still pending for disposal. In view of the above, it was submitted by the assessee before the learned CIT that the notice dt. 18th March, 2010 may be withdrawn or the matter may be kept in abeyance till the decision of the learned CIT(A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l the registration after having once granted it. Now, the power has been given to the CIT by inserting s. 12AA(3) by Finance Act, 2004 and the newly inserted section was made effective from 1st Oct., 2004. Sec. 12AA(3) reads as under : "Sec. 12AA (3) Where a trust or an institution has been granted registration under cl. (b) of sub-s. (1) or has obtained registration at any time under s. 12A as it stood before its amendment by Finance (No. 2) Act, 1996 (33 of 1996) and subsequently the CIT is satisfied that the activities of such trust or institution are not genuine or are not being carried out in accordance with the objects of the trust or institution, as the case may be, he shall pass an order in writing cancelling the registrati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. 12AA(3) by the Finance Act, 2010, which has inserted the phrase "or has obtained registration at any time under s. 12A" after the words "sub-s. (1)" as appearing in s. 12AA(3). This amendment has been made applicable and effective from 1st June, 2010. Keeping in view the ratio laid down by the Hon'ble High Court in the case of Oxford Academy for Career Development (supra) and also the amendment of s. 12AA(3) by the Finance Act, 2010 w.e.f. 1st June, 2010, it is amply clear that 12AA(3) is prospective in nature and if any trust/institution has been registered prior to 1st Oct., 2004 either under s. 12A or 12AA, the CIT has no power to cancel the registration under s. 12AA(3). In the instant case, registration to the assessee society was ..... X X X X Extracts X X X X X X X X Extracts X X X X
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