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TMI Blog2014 (1) TMI 933X X X X Extracts X X X X X X X X Extracts X X X X ..... under Registered Trust Deed dated 11.12.2007 had applied for registration under section 12A of the Act and also for approval under section 80G of the Act in prescribed manner. The applications were rejected by the DIT(E), Hyderabad vide order dated 3.6.2008 on the ground that the assessee trust has not commenced any activity as per the trust deed. The assessee challenged the rejection order by filing an appeal before the ITAT, Hyderabad Bench. The ITAT, Hyderabad Bench vide order dated 25.2.2010 in ITA.1193/Hyd/2008 set aside the Order of the DIT(E) and remitted the matter back to him with the following direction : ".....In view of this legislative mandate, and the notification of the CBDT, in our opinion, the DIT(E) has to apply his mind ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A of the Act. In this context, he relied upon the decision of the Hon'ble Kerala High Court in the case of Self-Employee's Service Society vs. CIT 247 ITR 18. The CIT(A) on going through the trust deed observed that few of the objects mentioned in the trust deed are not specific and also cannot be considered as of charitable nature. He, therefore, felt that the specific objects to be carried out by the assessee trust are therefore, not verifiable. The DIT(E) referring to clause 10 of the trust deed, came to conclusion that the assessee trust has mixed objects of both charitable and religious nature and therefore, after 1.4.1962 any trust having both charitable and religious objects, cannot be granted registration under section 12A of the Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (E) had any doubt with regard to the objects and activity of the trust, the same could have been expressed by him in clear terms in the course of hearing so that the assessee could have got an opportunity to explain the things in proper manner and remove the doubts which he might be having. It was submitted that without affording a proper opportunity to the assessee trust to explain the things, the DIT(E) has rejected the application on the basis of unsubstantiated facts. 5. The learned D.R. on the other hand supported the Order of the DIT(E). The learned D.R. however, submitted that if the assessee feels that proper opportunity was not given to him to explain the facts properly, the matter can be remitted to the DIT(E) for consideration a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... only to consider whether the objects of the trust are charitable or not. At that stage, it is not required to go into the activities of the trust which can be looked into at the time of assessment proceeding. The Hon'ble Gujarat High Court in the case of CIT-1 vs. Kutchi Dasa Oswal Moto Pariwar Ambama Trust (2013) 212 Taxman 435 (Gujarat) has held as under : "5. It can thus be seen that under section 12AA of the Act, the Commissioner has to satisfy himself abut the objectives of the trust and the genuineness of its activities. For such purpose, he has the power to call for such documents or information from the trust as he think are necessary. However, this does not mean that if the activities of the trust have not commenced, the Commissi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... clusion is also not correct as there is no such restriction under the relevant provisions of the Act which could suggest that a trust having religious activity is not eligible for exemption. The Hon'ble Madras High Court in the case of New Life Organisation vs. CIT has held that at the stage of grant of certificate under section 12A of the Act, the only enquire which could possibly be made would be whether the society has actually made an application in time and whether the accounts of the society are maintained in the manner as suggested by the said section. The Hon'ble High Court further held that merely because a trust is of a religious nature, it will not be disentitled from claiming registration under section 12A of the Act. So far as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the facts and circumstances of the case, we deem it proper to set aside the Order passed by the DIT(E) and remit the matter back to the file for considering the entire issue of grant of registration under section 12A of the Act afresh keeping in view our observations made hereinabove. The DIT(E) shall afford a reasonable opportunity of being heard to the assessee and allow the assessee to explain whatever doubt the DIT(E) might be having, which, according to him, puts restriction in granting registration under section 12A of the Act. The DIT(E) shall decide the issue after considering all the submissions of the assessee and also taking into account the decisions which the assessee may rely upon in support of his claim. With the aforesaid d ..... X X X X Extracts X X X X X X X X Extracts X X X X
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