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TMI Blog2012 (7) TMI 122X X X X Extracts X X X X X X X X Extracts X X X X ..... is a trust registered u/s. 12A(a) of the Act with Commissioner of Income Tax, Nashik vide certificate of registration dated 16-01-1987. By way of application dated 08-09-2009, the assessee approached the Commissioner for renewal of its recognition u/s. 80G(5)(vi) of the Act and the Commissioner has since rejected the application vide impugned order dated 24-03-2010. In order to appreciate the reasons weighing with the commissioner, the following portion of his order is reproduced here under : "The application in Form No. 10G was carefully scrutinized and it was found that, the applicant made investments/FDs in Senapati Bapat Nagri Sahakari Patsanstha which are clearly violative of Section 11(5) of the Income Tax Act, 1961................. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... [2009] 28 SOT 26 (Pune) (URO). Furthermore, it is also pointed out that the objections raised by the commissioner are not relevant to be considered at the time of examining the assessee's plea for recognition u/s. 80G(5)(vi) of the Act. In this connection, it is submitted that the scope of enquiry to be carried out by the commissioner at this stage does not require a conclusive proof that the assessee has complied with the provisions of Sections 11 and 12 of the Act and the commissioner is only required to examine the nature or character of the activities and to see as to whether the institution is eligible for exemption u/s. 11 or 12 and is registered u/s.12A(1) of the Act. In this case, the assessee was enjoying the registration u/s.12A(1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r such documents or information or cause such enquiries to be made as he may deem necessary to satisfy himself about the genuineness of the activities of the applicant before him. Sub-rule (4) of Rule 11AA of the Rules provide that where the commissioner is satisfied that all the conditions laid down in clauses (i) to (v) of sub-section (5) of section 80G are fulfilled by the institution or fund, he shall record such satisfaction in writing and grant approval or renewal thereof to the applicant. Pertinently, sub-rule (5) of Rule 11AA of the Rules prescribes that where the commissioner is not satisfied that one or more of the conditions laid down in clause (i) to (v) of sub-section (5) of section 80G are not fulfilled, he shall reject the ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e the objections made out by the commissioner refusing to renewal or recognition to the assessee u/s.80G(5)(vi) of the Act. To recapitulate, the first objection of the commissioner is to the effect that the assessee has made an investment which is violative of section 11(5) of the Act. The second objection is to the effect that upon recasting of the Income and Expenditure Accounts for the three financial years 2006-07 to 2008-09 by including the earmarked fund other than corpus, assessee has not applied the prescribed percentage of its income towards the stated purposes and therefore it is a violative of section 11(1) of the Act. Initially without going into the merits of the objections raised, it would be sufficient to observe that both th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Hon'ble Punjab and Haryana High Court in the case of Sonepat Hindu Educational and Charitable Society (supra). As per the Hon'ble Punjab and Haryana Court registration of an institution u/s.12A of the Act is sufficient proof of it being established for charitable purposes. It has been further explained by the Hon'ble High Court that the scope of enquiry by the commissioner, while dealing with an application u/s. 80G(5)(vi) of the Act, is to examine its eligibility under various provisions of the Act referred in the sub-section but not actual computation of income under the Act, particularly when the applicant is claiming exemption u/s. 11 and 12 and not u/s. 10 of the Act. 9. Considered in the light of the aforesaid reasoning laid dow ..... X X X X Extracts X X X X X X X X Extracts X X X X
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