TMI Blog2018 (12) TMI 124X X X X Extracts X X X X X X X X Extracts X X X X ..... ently, appeals filed by the assessee are allowed directing the ld. CIT (E) to provide registration u/s 12AA to the assessee and also to grant consequent approval u/s 80G of the Act. - Decided in favour of assessee. - ITA No.6768/Del./2015, ITA No.4490/Del./2018 - - - Dated:- 30-11-2018 - Shri N.K. Billaiya, Accountant Member And Shri Kuldip Singh, Judicial Member For the Assessee : Shri P.C. Yadav, Advocate For the Revenue : Shri J.K. Mishra, CIT DR ORDER PER KULDIP SINGH, JUDICIAL MEMBER : The appellant, The Rotary Megapolis Foundation (hereinafter referred to as the assessee ) by filing the present appeals, sought to set aside the impugned order both dated 19.10.2015 passed by Ld. CIT (Exemptions), New Delhi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y at hand are : the applications moved by the assessee company in Form No.10A and 10G for registration under section 12AA of the Income-tax Act, 1961 (for short the Act ) and approval u/s 80G of the Act respectively have been rejected by the ld. CIT on the grounds that the nature of the Trust in question is against the norm and character of a charitable organisation; that all the powers have been centralized with Trustees who can utilize the same for personal benefits and the donors would be controlling the function of the Trust at their own wishes and objects; and that the balance sheet filed by the Trust is unsigned and is not containing the detailed list of donors. 3. Feeling aggrieved, the assessee company has come up before the Tri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... victims of natural calamities, such as, floods, droughts k) To engage any other activity in order to fulfill the above objects. 6. The ld. CIT (Exemptions) declined the registration and approval u/s 12AA and 80G of the Act to the assessee by picking up the three clauses of the Trust Deed which are as under :- 15.15 The Board of Trustees may join, co-operate and amalgamate the trusts created by these presents or any portion thereof with any trust or institution having allied and/or similar objects upon such terms as they may in their absolute discretion think fit. 15.18 The Board of Trustees shall be entitled at their discretion from time to time to start, discontinue, abolish and restart any charitable institution, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ries. 9. However, when we examine all the powers conferred on the Board of Trustees in the light of the main objects and other objects of the Trust, it leads to the inescapable conclusion that the Trust has been created for just charitable purpose. Main objects of the Trust are only to confer the powers on the Board of Trustees to run the Trust in an efficient and charitable manner. Furthermore, assessee brought on record the detail of activities being carried out by the assessee vide letter, available at pages 15 16 of the paper book, to the notice of ld. CIT (E) showing that in order to achieve the objects of the Trust, it has hired five rooms in slum and JJ area and has already engaged five teachers to teach children of weaker secti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... read as a whole to work out if the Trust has been established to carry out the charitable activities. 11. So far as question of complete list of donors by the assessee is concerned, the same is otherwise required at the time of assessment and not at the time of registration u/s 12A of the Act. Furthermore, assessee Trust is required to carry out the charitable activities only after getting registration u/s 12A of the Act. Even otherwise, providing registration u/s 12A of the Act is not a licence for any Trust to utilize the same for their own benefit and for commercial purposes, which aspect is to be seen at the time of assessment. 12. Ld. CIT (E) was only required to firstly satisfy himself if the Trust has been established for ch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not render such institution non-charitable . 14. In view of what has been discussed above, we are of the considered view that the assessee Trust having been constituted to carry out the charitable activities is entitled for registration u/s 12AA of the Act and consequent approval u/s 80G but the ld. CIT (E) has erred in declining the registration u/s 12AA of the Act on the basis of conjectures and surmises that the Trust can be utilized for personal benefits of the Trustee which could be even commercial in nature without having any material on file in this regard, which is not sustainable in the eyes of law. Consequently, appeals filed by the assessee are allowed directing the ld. CIT (E) to provide registration u/s 12AA to the assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X
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