TMI Blog2016 (7) TMI 944X X X X Extracts X X X X X X X X Extracts X X X X ..... ny activity. The CIT has accepted that assessee has taken steps for implementation of its objects in as much as it has acquired the land, converted the land for institutional use for setting up the hospital project, appointed the architect., carried out soil testing etc. All these activities are towards the achieving the objects of the trust. The registration under section 25 of the companies Act has been granted on 13.10.2012, subsequently the land was acquired on 29.3.2013 and thereafter other activities like conversion of land use, appointment of architects and soil testing has been done. The project of setting up hospital and medical college is a complex project requiring various approvals, clearances etc which the appellant has been complying with. It is critical that as part of fund raising programme for this project, the appellant has sought the approval under section 80G whereby the donations can be accepted for approved purposes and the project can be expedited. The approval under section 80G will thus aid and provide the necessary support in successful completion of the project. In our view, ld CIT (Exemption) was not correct in denying the approval under section 80G(5) t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .11.2014 u/s 12AA, notes on activities of the institution, copy of PAN card, copy of audited financial statement alongwith return of income preceding three years and memorandum and article of association. 2.4 The CIT issued letter dated 07.01.2015 requiring the assessee to furnish certain information/documents which was furnished by the assessee vide letter dated 18.02.2015 filed on 01.06.2015. Again vide letter dated 19.06.2015 assessee submitted the status of working and activities done by it. 2.5 The CIT by perusing sec. 80G(5) r.w.r. 11AA held that at the time of grant of exemption u/s 80G(5), due important has to be given to the activities carried out by the organization and maintenance of accounts. However, no activities has been started by the assessee as per the objects and only capital expenditure like acquisition of land, conversion of land, appointment of architect, soil testing etc. is done and in a period of more than five years, assessee could not carry out any activity in accordance with the objects of the company. Accordingly, the CIT rejected the application of assessee for grant of exemption u/s 80G(5) of the IT Act, 1961. 2.6 The ld. AR has submitted tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... out any of the activities in accordance with the objects of the company. Seeing the insignificant nature of activity the case does not seems to be fit for granting exemption u/s 80G at this stage. Therefore, its application in form No. 10G seeking exemption u/s 80G is rejected. 2.8 Ld DR is heard who has relied upon the decision of ITAT Delhi Bench in case of Pearls Educational Institute 36 SOT 218. 2.9 We have heard the rival contentions and pursued the material available on record. Firstly, it is interesting to note that it is for the third time that the appellant has filed the subject application under section 80G(5) and on the previous occasions, the reasons cited by the ld CIT varies from assessee not registered u/s 12AA to registration certificate u/s 12AA not enclosed with the application and hence, it is not eligible for approval u/s 80G(5)(vi). The reasons cited in the impunged order states that seeing the insignificant nature of activity, the case does not seems to be fit for granting exemption u/s 80G at this stage. The question that arises for consideration is whether the reason cited by the ld CIT justifies denial of approval under section 80G(5) of the Act. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... quiring various approvals, clearances etc which the appellant has been complying with. It is critical that as part of fund raising programme for this project, the appellant has sought the approval under section 80G whereby the donations can be accepted for approved purposes and the project can be expedited. The approval under section 80G will thus aid and provide the necessary support in successful completion of the project. In our view, ld CIT (Exemption) was not correct in denying the approval under section 80G(5) to the appellant. 2.10 Further, we have gone through the decision of decision of Coordinate Bench in case of Pearls Educational Institute (Supra). The said decision was rendered in the context of renewal of approval under section 80G and the fact that the appellant in that case had not commenced construction activities even after 13 years which is distinguishable on facts as stated above. In our view, the said decision doesn t support the case of the Revenue. In fact, the Hon ble Allahabad High Court in case of Hardayal Charitable and Educational Trust vs. CIT (supra) is directly on the issue and supports our view. In that case, assessee trust applied for grant of re ..... X X X X Extracts X X X X X X X X Extracts X X X X
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