TMI Blog2014 (9) TMI 1102X X X X Extracts X X X X X X X X Extracts X X X X ..... AA(3). Circular issued by the CBDT on 06.04.2011 clearly mentions that amendment would be applicable from the AY.2011-12 and subsequent assessment years. In this case registration was granted in 1981 and was withdrawn for the AY.2009-10 i.e. before the AY. 2011-12. As the cancellation is against the provisions of law, so same cannot be endorsed. Here, we would also like to mention the case of Maharashtra Housing and Area Development Authority (2013 (11) TMI 516 - ITAT MUMBAI), DIT-E, Mumbai had withdrawn the registration granted to the assessee on the similar grounds. While deciding the appeal in favour of the assessee, Tribunal held that even though the objects of the institutions were no longer towards a charitable purpose in view of the amended law, registration u/s.12A could not be reviewed or withdrawn in absence of stipulation in section 12AA(3)regarding continuing satisfaction. - Decided in favour of the assessee-trust. - ITA No. 1193/Mum/2012 - - - Dated:- 29-9-2014 - Vijay Pal Rao (Judicial Member) And Rajendra (Accountant Member) For the Assessee : Rajesh S. Athavale For the Revenue : A. C. Tejpal ORDER Rajendra (Accountant Member) Challe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... embers inside the Gymkhana premises. Referring to the provisions of the section 2(15) of the Act, he further held that if any trust; whose main object was for advancement of any other object of general public utility; carried out any activities which were in the nature of any trade/commerce/business then all actions of such a trust were covered by the aforesaid proviso. He further held that in the assessee s case there were clear-cut earnings which was shown as income by way of Goodwill from Caterers of ₹ 50.12 lakhs and additional facilities charges for ₹ 116.79 laks, that such receipts were in excess of ₹ 10 lacs, that the assessee was receiving income towards commercial exploitation of its property in a systematic manner which was nothing but a business income, that the assessee trust was directly hit by the proviso to section 2(15) which had been introduced from AY. 2009- 10, that once a charitable trust was hit by aforesaid proviso there was change in the status of such trust and it was to be held that it was not for charitable purpose. He finally held that the assessee trust had become non genuine for the purposes of section 11of the Act and the registration ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... trust were not genuine or were not carried out as per the objects of the trust. We will also like to mention that because of amendment to section 2(15) w.e.f.01.04.2009 certain changes have been introduced in the provisions governing the trusts and the definition of the phrase charitable activities has not remained same. Similarly, certain amendments have been brought in the statute, as power was given to the departmental authorities to cancel the registration as per the provisions of section 12 AA(3)of the Act. We find that the Explanatory Notes to the provisions of the Finance Act, 2010(Circular No.1/2011[F.No.142/l/2011-SO(TPL)-I, dated 6-4- 2011) has explained the background for bringing change in the section as under: 7. Cancellation of registration obtained under section 12A 7.1. Section 12AA provides the procedure relating to registration of a trust or institution engaged in charitable activities. Section 12AA(3)previously provided that if the activities of the trust or institution are found to be non-genuine or its activities are not in accordance with the objects for which such trust or institution was established, the registration granted under section 12AA c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessment year 2009- 10. Deciding the appeal, the Tribunal held as under: From the conjoint reading of sub-section (1) clause (b) and sub-section (3) of section 12AA, it would be seen that the cancellation of the registration was provided where the registration was granted under clause (b) of sub-section (1). Further cancellation under sub-section (3) was also provided where the registration was obtained at any time under section 12A [may be under clause (a) or clause (aa) of sub-section (1) of section 12A]. But this power of cancellation of registration obtained under section 12A came to be incorporated by way of amendment introduced by the Finance Act, 2010 with effect from 01.06.2010. That being the interpretation of sub-section (3), it is amply clear that the power to cancel the registration once granted was only confined to the registration granted under clause (b) of sub-section (1) of section 12AA till before 01.06.2010. Of course, now with effect from 01.06.2010, the power vests with the Commissioner even to cancel the registration granted under any of the clauses of sub-section (1) of section 12A Section 12AA(3) of the Act empowers the CIT to cancel such registratio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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