TMI Blog2017 (12) TMI 933X X X X Extracts X X X X X X X X Extracts X X X X ..... ellant was only in applying the government funds; which too was not spent to the extent made available. As noticed by the Tribunal and the Commissioner, the charitable activities carried out by the appellant, was only in so far as expending the fund provided by the Government, that too, not to its full extent. The appellant was found to have not applied any part of their net income to the objectives stated in the Memorandum of Association. Thus, the appellant was also found to have not carried out any charitable activity in the relevant years, from the income derived from various activities of facilitation of certification and other matters in respect of the Non-Resident Keralites. The Tribunal found that, though technically, the objects of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ermine whether the efforts of the appellant also were in line with its avowed objective. The appellant was established and had been purportedly carrying on its objects for some years, while the question of registration as a charitable institution was being considered by the statutory authorities. The Division Bench observed that though verification of accounts is an exercise, carried on every year in the course of assessment after granting registration; it could even be verified in consideration of the registration. The said exercise, carried out by the Commissioner before granting registration, would be necessarily for ascertainment of the source of funds and its application. It was specifically observed that if under cover of promoting in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y constituted to channel the funds of the Government. 4. The Commissioner while verifying the aspects as directed by the Division Bench of this Court had looked at the specific source of funds and expenditure of the appellant over the years from 2006-07 to 2013-14. The Tribunal too has extracted the figures as found in the Commissioner s order, which we do not intend to extract herein again. Suffice it to notice that though the receipts of income from certification, bank interest, project identify card and other income like photostat and cover sales exceeded to ₹ 1,00,00,000/- for the financial year 2006-07 and reached ₹ 3,33,00,000/- in the year 2012-13, there is no expenditure for charitable purpose made from such income ge ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Department, very little has been spent, out of the income derived over the years, for any charitable purpose. The administrative expenses ate up a good percentage and the rest ended up as profits. The learned Counsel for the appellant argued that in implementing the schemes of the Government, there, necessarily, will be administrative charges. But, it cannot be above the amounts actually expended. We find that in all the years, the expenditure has exceeded the amounts spent for charitable purposes. As per Section 12AA of the Income Tax Act, the Commissioner is empowered to call for documents or information from the assessee, which are necessary to satisfy the authority about the genuineness of the activities of the institution. The Divis ..... X X X X Extracts X X X X X X X X Extracts X X X X
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