TMI Blog2015 (1) TMI 1202X X X X Extracts X X X X X X X X Extracts X X X X ..... cancel the registration, do not exist in the present case. The registration granted is cancelled in view of the amendment of the first proviso to section 2(15) of the Act. That is not a ground specified in the statute for cancellation of the registration. In fact, sub-section (8) of section 13 of the Act which is introduced by Finance Act, 2012, which came into effect from April 1, 2009, categorically provides that, nothing contained in section 11 or section 12 shall operate so as to exclude any income from the total income of the previous year or any receipt thereof. If the provisions of the first proviso to clause (15) of section 2 becomes applicable in the case of such person in the said previous year, the statute has protected the i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ), was granted registration under section 12A of the Act on October 25, 1980, by an order passed by the Commissioner of Income-tax. Subsequently, a notice came to be issued on April 13, 2011, as to why registration under section 12A of the Act should not be revoked by invoking the provisions of section 12AA(3) of the Act by the authorities. In response to the said notice, the KBA filed written submission on August 6, 2011, and contested the matter. The authorities took note of the fact that the accounts for the year ending March 31, 2009, shows that the total receipts to an extent of ₹ 1,01,03,322 and ₹ 1,18,35,000 and excess of income over expenditure at ₹ 94,59,372 and ₹ 1,10,92,691 for the assessment years 2008-09 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ,48,639 4,26,272 Coaching expenses 4,05,997 4,28,148 Total 15,54,566 13,12,997 3. The Director of Income-tax (Exemptions) considering the entire material on record, by his order dated October 20, 2011, exercising his powers under the provisions of section 12A of the Act has cancelled the registration observing that the examination of records KBA has earned a net profit of ₹ 94,59,372 and ₹ 1,10,92,691 for the assessment years 2008-09 and 2009-10, respectively. Under various heads, the KBA has earned huge profits and after taking note of the change in the definition of section 2(15) of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t activity carried out by the assessee-trust was running of bar which is not in accordance with the objects and the same cannot be considered as charitable activity and recorded a perverse finding ? (ii) Whether the Tribunal was correct in holding that the assessee is entitled for registration under section 12A of the Act, when the activi ties of the assessee are like a club, catering to the members and it exists for the mutual benefits of its members and, consequently, not carrying on charitable activity and recorded a perverse finding ? 6. The learned counsel for the Revenue assailing the impugned order contended that the definition of charitable institution has undergone a change with effect from April 1, 2009. The activities car ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... conferred under the provisions of section 12AA(3) of the Act. Therefore, it is necessary to find out under what circumstances the registration granted earlier could be cancelled. Section 12AA(3) of the Act reads as under : (3) Where a trust or an institution has been granted registration under clause (b) of sub-section (1) or has obtained registration at any time under section 12A as it stood before its amendment by the Finance (No. 2) Act, 1996 (33 of 1996), and subsequently the Com missioner is satisfied that the activities of such trust or institution are not genuine or are 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 registr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ns stipulated under the provisions of sub-section (3) of section 12AA of the Act, which empowers the authority to cancel the registration, do not exist in the present case. The registration granted is cancelled in view of the amendment of the first proviso to section 2(15) of the Act. That is not a ground specified in the statute for cancellation of the registration. In fact, sub-section (8) of section 13 of the Act which is introduced by Finance Act, 2012, which came into effect from April 1, 2009, categorically provides that, nothing contained in section 11 or section 12 shall operate so as to exclude any income from the total income of the previous year or any receipt thereof. If the provisions of the first proviso to clause (15) of sect ..... X X X X Extracts X X X X X X X X Extracts X X X X
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