TMI Blog2017 (1) TMI 446X X X X Extracts X X X X X X X X Extracts X X X X ..... for grant of registration under section 12A of the Act by recording incorrect and irrelevant facts and circumstances and the assessee successfully established that it was created for the charitable purposes including education activity and it used its funds for the purpose of educational activities and therefore the applicant trust is eligible for registration under section 12A of the Act. - Decided in favour of assessee Disallowance of expenses on account of valuation of section 40A(3) - Held that:- CIT(A) has observed that the assessee has not filed any submission either before the AO or before the Ld. CIT(A) to explain the reasons for the infringement of section 40A(3), hence, the appeal on this ground was dismissed. In my considered ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rroneous. 5. That in facts and circumstances of the case, the society be granted exemption u/s. 11 of the I.T. Act. 6. The due relief in law may please be granted and returned income may please be accepted. 7. That in fact and circumstance of the case, appellant be permitted to add or delete any grounds of appeal. 2. The brief facts of the case are that the assessee society registered under the Society Registration Act with the Registrar of Societies, Uttarakhand vide Registration No. 11/2008-2009 dated 11.3.2008 for a period upto 3.4.2013. The assessee was registered u/s. 12AA with the CIT, Dehradun vide order dated 10.10.2008 which has since been withdrawn by the Ld. CIT, Dehradun vide her order dated 26.3.2013. The return of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stration, the CIT has recorded a finding that the assessee is operating like a commercial tour operator and there is no element of charitable activity involved in the assessee activities. Accordingly, since the registration u/s. 12AA issued vide C.No. 40/12(1)/Registration/Haridwar/2008-09 / Tech. 11321-324 dated 8.10.2008 stands withdrawn by the CIT, the assessee cannot be granted the benefits of exemption u/s. 11 of the I.T. Act, 1961. In the circumstances, the surplus in its accounts has to be taxed as business profits. The addition of ₹ 6,01,755/- made on this account was therefore, confirmed vide Ld. CIT(A) s order dated 24.2.2016 and on the issue of disallowance of expenses on account of valuation of section 40A(3) amounting to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion u/s. 12AA vide order dated 8.10.2008 passed by the CIT, Dehradun, as a result the assessee cannot be granted the benefits of exemption u/s. 11 of the I.T. Act and addition in dispute was confirmed. However, on going through the copy of the order of the Tribunal dated 25.10.2016 in assessee s own case passed in ITA No. 2425/Del/2013 wherein, the Tribunal has set aside the order of the Ld. CIT and restored the registration u/s. 12AA of the I.T. Act. The relevant para no. 7 to 8 at page no. 7 to 10 of the Tribunal s order dated 25.10.2016 are reproduced hereunder:- 7. We have heard both the parties and perused the records. We find that only effective issue in the present appeal is against the cancellation of registration by the CIT by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... econd class third sleeper but luxury AC coaches would have been hired and instead of giving the knowledge of incredible India it would have given the lectures regarding dances and beaches. We find that it is a settled law when the registration was granted u/s. 12AA on the basis of objects and activities (mentioned at page no. 1 of the impugned order) and these very objects and activities are being carried out by the assessee, registration cannot be cancelled as held by the Coordinate Bench decision in the case of Sharda Educational Trust vs. CIT (Central) 147 ITD 271, 107 DTR 201 (Agra Trib) dated 24.5.2013. 7.1 We further find that registration cannot be cancelled by re-examination of the objects on the basis of which registration was o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... son becomes a temporary member of the society for the period of the Yatra. The total money charged from the individuals for the yatra is ₹ 21,500/- for a period of 31 days, which comes to less that ₹ 700/- daily. This includes provision of train tickets, bus hire, lodging charges, refreshments and three freshly cooked meals daily. Hence, it is established that charging such minimal amount could never be compared to an activity run with profit motive. 7.5 We further note that the Ld. CIT cancelled the registration without giving the date from which cancellation of registration would take place and therefore in the absence of any date which registration would be cancelled, thus, the CIT s impugned order cannot be sustained, as ..... X X X X Extracts X X X X X X X X Extracts X X X X
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