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Hari Om Sewa Dal Versus CIT (Exemptions) , C.R. Building, Chandigarh

2015 (11) TMI 1124 - ITAT DELHI

Registration under Section 12AA denied - depreciation claimed on the land - Held that:- registration under Section 12AA of the Act was denied to the appellant society solely on the ground that the appellant society had been claiming depreciation on the land which is not permissible under the Income Tax Act. In our considered opinion, this is not relevant consideration at the time of grant of registration. It is the issue to be examined during the course of assessment proceedings after grant of r .....

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of the Act - Decided in favour of assessee. - ITA Nos. 2285 & 2286/Del/2015 - Dated:- 4-11-2015 - SH. INTURI RAMA RAO, ACCOUNTANT MEMBER AND MS. SUCHITRA KAMBLE, JUDICIA MEMBER For The Appellant by : Sh. Naveen Gupta, Adv. For The Respondent by : Sh. H.K. Choudhary, CIT(DR) ORDER PER INTURI RAMA RAO, A.M.: ITA No. 2285/Del/2015 The present appeal filed by the assessee society is directed against the order of Commissioner of Income Tax (Exemptions), dated 30.03.2015 passed under Section 12AA of t .....

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12AA of the Act. iii. That the appellant craves leave to add or alter any of the Ground of Appeal. 2. The brief facts of the case are that the appellant society was registered under the Societies and Registration Act on 8th September, 1999 with the following objects: 1. To promote and foster social, cultural and moral behaviour. 2. To adopt ways and means to promote social welfare & happiness and alleviate human suffering and misery irrespective of caste, creed, colour and ideology. 3. To im .....

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vals of national recognition likely to bring about social and mental harmony, peace and fellowship. 8. To arise the consciousnss among the members and others against the social evils and to promote the sense of responsibility and discipline to be good inhabitants of the nation. 9. To arrange games, competitions in paintings essay writings etc. for children and to develop their physical fitness and to broaden their mental horizon. 10. To print and publish and to sell or distribute journals, perio .....

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imilar institutions in propagating the cause of various types of social reforms. Registered Office of Society: 14. To do other acts of general public utility as the 'Executive Body' may from time to time, decide, 15. To do all other acts or subjects as are incidental or conducive to the attainment of above objects and to dedicate for the fulfillment of duties towards nation. 16. Promotion of national unity and international peace and amity. 17. 16, Promotion of communal and social harmon .....

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iculture and animal husbandry and engineering sources. 20. To take up programmes for ensuring protection of environment and for regeneration of natural resources degraded due to past neglects. 21. Promotion and extension of appropriate technology including systems having renewable sources of energy. 22. To take up programmes in which science and technology may have major role in improving life, working conditions and opportunities for gainful employment of women. 23. To undertake impact evaluati .....

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above and also for all other similar activities in furtherance of ideals of truth and non-violence. financial institutions. The funds, properties, assets and all other resources, present and future, of the Society shall be utilized for any or all the purposes or objects of the Society as stated above and also for all other similar activities in furtherance of ideals of truth and non-violence. 2.1 The appellant society made the application in Form No. 10A for registration of the society under Se .....

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Ld. counsel for the appellant society argued that the objects of the appellant society are purely charitable in nature and exists solely for charitable purposes. All the conditions which are required for grant of registration under Section 12AA of the Act were complied with and the Commissioner of Income Tax (Exemptions), Chandigarh, was not justified in refusing the registration of society under Section 12AA of the Act. The Commissioner of Income Tax (Exemptions), Chandigarh ought not have mad .....

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ing depreciation on the land which is not permissible under the Income Tax Act. In our considered opinion, this is not relevant consideration at the time of grant of registration. It is the issue to be examined during the course of assessment proceedings after grant of registration under Section 12AA of the Act. In this connection, it is relevant to mention that one of us (Hon ble Accountant Member) is author of the order in the case of Paramount Public School Education Society Vs. CIT, in ITA N .....

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e Commissioner of Income Tax had rejected the application primarily on two grounds. The first ground relates to the jurisdiction of the case, according to ld. CIT, jurisdiction of the case did not lie with him. First of all, we shall deal with the first objection raised by the CIT. In our considered opinion, it is undisputed fact that the appellant society filed the returns of income with the Income Tax Officer (Exemption), Rohtak. We also find from the paper book that the Deputy Commissioner of .....

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re that the learned CIT(DR) fairly conceded before us that this objection does not hold water. 6. Now, coming to the second objection raised by the CIT that the proviso to Section 2(15) is applicable to the appellant society and the appellant society had failed to comply with the direction of the Commissioner of Income Tax to file the details of the donors of the corpus funds. The scope of the power of Commissioner of Income Tax while granting the registration under Section 12A of the Act was ex .....

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the section shows that the registration under section 12A is a precondition for availing the benefit under sections 11 and 12 of the Act. Section 11 provides for exemption of income which is applied for charitable purposes. Section 12 is in the nature of an Explanation to section 11. Before a person can claim the benefits of section 11 or section 12, as the case may be, he must obtain registration under section 12A. The application for registration under section 12A has to be made in Form No. 10 .....

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up. He may also see whether the objects of the trust are charitable or not At this stage, it is not proper to examine the application of income. 4. The order impugned does not say that the objects of the society are not charitable in nature; it merely says that they are general in nature. Just because they are general, they do not cease to be charitable. The Commissioner has also observed that no activity has been carried out by the society. It is also not the requirement of section 12A nor sect .....

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e when such trust/institution files the return. The relevant para of this case is reproduced as under: ……………..Therefore, the provisions of Sections 11, 12 or Section 10(23C) of the Act, deal with the income of a Trust or of the Institution and the circumstances as to when such income is to be excluded for computing the total income, but the basis of such benefit is the registration under Section 12AA of the Act. Unless a Trust or Institution is registered under .....

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ection 12AA of the Act, requires satisfaction in respect of the genuineness of the activities of the Trust, which includes the activities which the Trust is undertaking at present and also which it may contemplate to undertake. The insertion of sub-section (3) to Section 12AA of the Act, clarifies the said fact, when it empowers the Commissioner to cancel the registration if the activities of the Trust are not carried out in accordance with such objects. 11. Therefore, the object of Section 12AA .....

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ourt in the case of Sanjeevamma Hanumanthe Gowda Charitable Trust Vs. Director of Income Tax (Exemption), (2006) 285 ITR 327 (Karn.) held that the registration of institution relates to the objects so that the activities be charitable, which should be considered as genuine trust. If the activities of the institution are taxable for any reason the matter to be considered at the time of assessment. The source of income cannot be questioned at the time of granting the registration under Section 12A .....

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