TMI Blog2000 (9) TMI 47X X X X Extracts X X X X X X X X Extracts X X X X ..... d by the respondent under exhibit P5 order. The society filed an original petition seeking to quash exhibit P5. A writ of mandamus was also sought for a direction to the respondent to register the society under section 12AA of the Income-tax Act, 1961. The learned single judge who heard the original petition disposed of the same with the following direction : "2. In the circumstances of the case and in view of the contentions raised by the petitioner that after the first year when they generated income they are doing charitable work and on the submission of standing counsel that they will consider the matter if fresh application is filed, I direct the Commissioner of Income-tax to consider the matter afresh, if the petitioner files a fres ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat in future the society proposes to carry on activities of charitable nature in conformity of its object. The decision to start a technical educational institution at Kottayam itself was taken only on June 14, 1999. Therefore, we find no merit in the contention that the order is vitiated for having been issued in violation of the principles of natural justice. Section 12AA which was inserted by the Finance (No. 2) Act, 1996, with effect from April 1, 1997, reads as follows : "12AA. (1) The Chief Commissioner or Commissioner, on receipt of an application for registration of a trust or institution made under clause (a) of section 12A, shall--- (a) call for such documents or information from the trust or institution as he thinks necess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on are also to be mentioned in the order. Grant of such registration is made one of the conditions for obtaining exemption regarding income-tax. The amendment which had come into effect from April 1, 1997, would apply in relation to the assessment year 1997-98 and subsequent years. On the enquiry made by the Commissioner it was found that the members of the society, are mainly merchants. Its activity is accepting recurring deposits from its members and fixed deposits from the public. Loans are being given to its members at 21 per cent. interest. The officer found that in spite of the reference to a large number of charitable objects in its bye-laws, the activity carried on by the society is confined to its members numbering about 150. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to file a fresh application when they actually start doing charitable work and the Commissioner has been directed to consider such application on the merits untrammelled by the view taken in exhibit P5. According to us, no better relief could be granted to the society in this case. Learned counsel for the appellant referred to a number of decisions regarding the nature of activities which would entitle a registration under section 12A. We are not referring to those decisions in this judgment as they are not relevant for the issue with which We are concerned in this appeal. This is not a case where exemption was denied for not complying with the conditions contained under section 12A. The society has reached only the preliminary stage of m ..... X X X X Extracts X X X X X X X X Extracts X X X X
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