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TMI Blog2012 (11) TMI 273X X X X Extracts X X X X X X X X Extracts X X X X ..... it was engaged in providing 'Education' within the meaning of that word in Section 2 (15) of the Act. 3. That without prejudice to the generality of Grounds of Appeal No.1 & 2 above, DIT erred in holding that the appellant was carrying on any activity in the nature of trade, commerce or business or any activity of rendering any service in relation to any trade, commerce or business for a cess or fee or any other consideration and, therefore, the appellant is not covered by the mischief of the proviso to Section 2 (15) of the Act. 4. That without prejudice to the generality of Ground of Appeal No.3 above, DIT failed to appreciate that the publishing division of the appellant publishes and circulates a scientific medical journal by the name Indian Journal of Radiology and Imaging and also News Bulletins not for any commercial purposes but only for the purpose of educating its members and such professional Doctors that subscribe to these journals. This would be evident from the fact that from year to year the expenses incurred by the publishing division are in excess of the receipts. 5. That on the facts and in the circumstances of the case, since the approval under section 80G (5 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ritable nature and, hence, ld. DIT (E) was right in denying the renewal of approval u/s 80G. 6. After hearing both the parties, we find that the present issue is covered by the decision of this Tribunal in the case of Educate India Society vs. DIT (E), order dated 28th October, 2011 in ITA No.3895/Del/2011 in which similar issue was raised by the assessee and the appeal was decided in favour of the assessee. For the sake of convenience, the said order is reproduced below:- "This is an appeal filed by the assessee. It is directed against the order passed by the Director of Income-tax (Exemptions) [DIT (E)] u/s 80G(5)(vi) of Income-tax Act, 1961 (the Act) read with Rule 11AA of Income-tax Rules, 1962 (the Rules). The grounds of appeal read as under:- 1. That the rejection orders passed u/s 80G(5)(vi) of the Act, are against the law and to the facts of the case. 7. That the ld. DIT (Exemptions) failed to appreciate that as per the amended provisions of law after 1st October, 09 the exemption already allowed/granted up till 31.03.10 shall be deemed to have been extended in perpetuity unless specifically withdrawn as contained in Board's Circular No.7/2010 (F.No.197/21/2010 I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... also misuse of corpus donation received from donors for a particular purpose, the assessee did not satisfy the conditions laid down u/s 80G(5) of the Act. The assessee is aggrieved by such order passed by ld. DIT (E) and, hence, has filed the aforementioned appeal. 4. At the outset, it was submitted by the learned AR that by omission of the proviso to Section 80G(5) (vi), the assessee's obligation to seek such renewal has been done away with and this position of law has been made clear by the CBDT vide its Circular No.7/2010 (F.No.197/21/2010- ITA-I dated 27th October, 2010). He has placed on our record a copy thereof wherein the Board has issued certain clarification with regard to period of validity of approvals inter alia including u/s 80G (5). In para 5of the said Circular it has been stated as under:- "5. As regards approvals granted upto 1-10-2009 under section 80G by the Commissioners of Income- tax/Directors of Income-tax, proviso to section 80G(5)(vi) clarified that any approval shall have effect for such assessment year or years not exceeding five assessment years as may be specified in the approval. The above proviso was deleted by the Finance (No. 2) Act, 2009. The i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ong as it is not withdrawn as per the provisions of IT Act. In that case the application for renewal was made on 31st March, 2010 as said exemption was expiring after 1st October, 2009. It was held that the directions of CIT (A) for rejection of renewal application was not required to be maintained as by virtue of operation of law the exemption shall be deemed to be continued in perpetuity and it will continue so long as it is not withdrawn as per the provisions of the Act. He has also placed a copy of the said decision on our record and a copy was also given to the learned DR. Therefore, it is the case of the learned AR that directions of DIT (E) regarding rejection of renewal application filed by the assessee are not maintainable and should be vacated as the assessee by virtue of provisions of law will enjoy the approval u/s 80G in perpetuity as it has been already granted with approval which fall beyond 1st October, 2009 and is upto 31st March, 2010. 6. On the other hand, relying upon the order passed by the DIT (E), it is the case of the learned DR that the assessee's application has rightly been rejected as the assessee did not appear to substantiate its application for rene ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ity. At the same time it has been mentioned that the Commissioner will also have the power to withdraw the approval if the commissioner is satisfied that the activities of such institution or fund are non-genuine or are not being carried out in accordance with the objects of the institution or fund. No material whatsoever has been brought on record to suggest that the approval granted by the department to the assessee u/s 80G has ever been withdrawn. What has been considered by the ld. DIT (E) in his order is the application filed by the assessee for renewal of approval which cannot in any manner be interpreted as withdrawal of approval u/s 80G. Now, the question will be that whether by mere filing the application for renewal of approval u/s 80G the assessee can be held to be not entitled for the benefit of approval u/s 80G. In our opinion, where there is no statutory obligation on the assessee to seek renewal of the approval, then, the application filed by the assessee has no meaning as the statutory provisions will prevail. The interpretation of the statutory provision as well as the aforementioned Circular issued by the CBDT clearly states that the existing approvals expiring on ..... X X X X Extracts X X X X X X X X Extracts X X X X
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