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TMI Blog2013 (2) TMI 577X X X X Extracts X X X X X X X X Extracts X X X X ..... nd earning huge profits. The Ld. CIT(A) also noticed that the assessee is charging fees and fines from the sale of forms, land enhancement fee, building plan fees, road cutting fees, transfer fee, fine and penalties and non construction charges. Keeping in view the amend definition of section 2(15) of the Act w.e.f. 01.04.2009, the Ld. CIT, Bathinda has issued a show cause notice to the assessee. The Ld. counsel for the assessee has submitted before the Ld. CIT that the assessee-trust applied for registration u/s 12AA of the Act on 15.05.2005 and all the relevant documents were submitted before the ld. CIT(A) as well as DCIT, Circle-1, Bathinda during the process of granting the registration and discussed all the issues at length. But predecessor rejected the registration application and the assessee Improvement Trust, Bathinda went in appeal before the I.T.A.T. Amritsar Bench, who also rejected the appeal and later on assessee filed M.A. u/s 254(2) of the Act, which was accepted by the Tribunal and set aside the matter to CIT to decide the matter with some directions vide M.A.No.67(Asr)/2009 dated 04.03.2010 and so keeping in view the directions of the ITAT, the predecessor allowe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to avail of any benefit. Such are not the ways of being charitable. The clear cut activities of the assessee trust hardly veil the fact that the assessee trust is only in the mushrooming business of real estate development and sale, which is contrary to the definition of charitable purpose as given in section 2(15) of the Act, amended w.e.f.01.04.2009. As regards to the contention of the assessee that some other Institutions have been granted registration u/s 12A in this regard, the ld. CIT has observed that such registration has been granted before insertion of provisions of section 2(15) of the Act w.e.f. 01.04.2009. The change in the definition of charitable purpose has came into effect from 01.04.2009 and hence the assessee-trust cannot draw any benefit that registration u/s 12AA has been granted to the Institution having similar objects/activities, prior to the change of definition to the Charitable purpose u/s 2(15) of the Act. 4. The Ld. CIT, Bathinda respectfully followed the decisions of Hon'ble Supreme Court in the case of Indian Chamber of Commerce v. CIT [1975] 101 ITR 796 as well ITAT, Amritsar Bench and ITAT Chandigarh Bench and finally held that he is not satisfied ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 06] the facts of this case are entirely different and not applicable to the case of the assessee-trust and without prejudice to the arguments advanced by him, he submitted that power to cancel registration u/s 12AA(3) is prospective. Registration granted earlier to the assessee-trust can not be cancelled by the CIT retrospectively. The order of the CIT does not mentions whether registration is being cancelled from the date of order passed or some earlier dated. In support of his contention, he relied upon the various decisions mentioned a under: (i) Welham Boy's School Society v. CBDT [2006] 285 ITR 74 (ii) Chaturvedi Har Prasad Educational Society v. CIT [2011] 45 SOT 108 (Luck.) (iii) Kailashanand Mission Trust v. Asstt. CIT [2004] 88 ITD 125 (Delhi) (iv) Punjab Urban Planning & Development Authority case (supra). 5.1 Lastly he requested that the impugned order passed by the Ld. CIT, Bathinda may be cancelled. 6. On the contrary, the Ld. DR, Sh. Tarsem Lal, controverted the arguments advanced by the ld. counsel for the assessee and stated that in view of the amended definition of section 2(15) of the Act, w.e.f. 01.-04.2009, the Ld. CIT, Bathinda has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cost of land from cost of purchase by it. The assessee-trust is also charging fees and fines from selling of Forms, land enhancement fees, building plan fees, road cutting fees, transfer fees, fine and penalties and non-construction charges and thus earning huge profits, which is contrary to the provisions of section 2(15) of the Act, amended w.e.f. 01.04.2009. For the sake of convenience provision of section 2(15) of the Act is produced as under: "2(15) "charitable purpose" includes relief of the poor, education, medical relief, and the advancement of any other object of general public utility: Provided that the advancement of any other object of general public utility shall not be a charitable purpose, if it involves the carrying on of 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, irrespective of the nature of use or application, or retention, of the income from such activity." 7.1 Keeping in view the aforesaid provisions, the charitable purpose include relief to the poor, education, medical relief and advancement of any other obje ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... No.41 dated 31.12.2007 (free of cost). (i) Donation of Rs. 5 lacs to : Deaf & Dumb School for the welfare of such handicap students, vide Resolution No.81 dated 31.10.2005. (j) Land for Vridh Ashram (Rest house for Senior citizens) measuring 2038 sq. yds in Transport Nagar (Free of cost). (k) Land measuring 2055 sq.yds for children & ladies welfare association in Transport Nagar vide Resolution No.107 dated 30.12.2005 (free of cost). (l) Land for 'Public Health Care Centre' measuring 1825 sq. yds in Kamla Nehru vide Resolution No.23, dated 03.06.2009. (m) construction of Rs.25 lakh for construction of divider & road from 'Bridge to N.F.L. chowk' payment was made in 21.11.2001 by cheque to PWD (B&R) for public use. (o) Grant of Rs.1.25 lakhs to "Deaf and Dumb School" Bathinda vide Resolution No.11 dated 14.04.2007 for the welfare of such handicap students. (p) Land reserved for 'Yatri Niwas' in Bathinda near to New Bus Stand in 49.5 Acre (free of cost). (q) Land provided for 'Approach Road' nearly 60 wide 382.4 sq. mtr. Construction cost is nearly Rs.23.67 lacs approved vide Resolution No.21 dated 11.10.2007 (free of cost)." ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndment by the Finance (No.2) Act, 1996 (33 of 1996)] or institution are not genuine or 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 registration of such trust or institution: Provided that no order under this sub-section shall be passed unless such trust or institution has been given a reasonable opportunity of being heard.] 7.4 After going through the aforesaid provisions, we are of the considered opinion that the ld. CIT(A) has rightly cancelled the registration granted to the assessee-trust w.e.f. 12.06.2003 in view of the amended provision of section 12AA(3) of the Act. In the present case, the ld. CIT, Bathinda is fully satisfied that the activities of the assessee-trust are not genuine and not being carried out in accordance with the objects of the assessee-trust, as discussed above. 7.5 The Ld. counsel for the assessee has also not established before us that the assessee-trust is carrying out any charitable activities for the relief of poor, education, medical relief or for any other object of general public utility. 7.6 The ld. counsel for the assessee has cited the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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