TMI Blog2019 (6) TMI 476X X X X Extracts X X X X X X X X Extracts X X X X ..... the requirements which are required to be evaluated by the Director at the stage of considering application u/s 80G(5). Some of the germane issues in the present case which clearly stand out are as follows; that the assessee continues to be a charitable institution u/s 12A - assessee has been regularly filing its return of income and claiming exemption u/ss 11/12 - there is no adverse order by the AO with regard to assessee s claim for exemption u/ss 11/12 - since Assessment Year 1997-98 and till Assessment Year 2008-09, assessee was granted recognition u/s 80G there is no allegation, much less a finding by the Director, that the activities of the assessee have undergone any change from the past years, we do not find any justification on the part of the Director in denying the recognition sought u/s 80G Even otherwise, we find that the observation of the Director that the assessee is not engaged in charitable activities or that money has not been spent towards attainment of the objects is quite misplaced. Various activities being carried out by the assessee-trust, namely, weekly meetings and library, Sky observation programmes, exhibitions, slide shows, basic and advanced co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... upto 31.03.2008, i.e. upto Assessment Year 2008-09. Subsequently, vide application dated 17.06.2008, assessee made an application to the Director seeking continuation of recognition earlier granted under Section 80G of the Act. By way of the impugned order, the Director has rejected the application on the ground that the applicant-trust was not engaged in any charitable activity. As per the Director, the Profit Loss Account of the assessee-trust for the last three years shows that no expenditure on account of the objects of the trust has been incurred/debited by the applicant-trust during the last three years period . Against such a decision of the Director, assessee is in appeal before us. The appellant has raised the following Grounds of appeal :- Ground I : The DIT(E) erred in rejecting the Renewal application dt. 17-06-2008 for approval of the Institution for the purposes of Sec. 80G long after the expiry of Six months stipulated in Sec. 80G(5) read with rule II AA. The DIT(E) failed to appreciate that (i) All the requirements for Renewal applications were duly accompanied. (ii) Having complied with all the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5. Having considered the rival stands, in our view, the reasons for the delay explained by the assessee are not lacking in bona fides as there is nothing on record to controvert the averments made in the Affidavit filed before us. In any case, it is a settled proposition that it is not the length of the delay, but the quality of the reasons for delay, which shall prevail in order to adjudicate whether a condonation of delay is merited. The Hon'ble Supreme Court in the case of Collector, Land Acquisition vs. Mst. Katiji Ors., 167 ITR 471 (SC) held that the substantive cause of justice should prevail over technical considerations, while dealing with the condonation of delay applications. Therefore, considering the entirety of facts and circumstances of the instant case, we deem it fit and proper to condone the delay in filing of the appeal. The aforesaid decision was announced before the parties, and therefore both the counsels were heard with respect to the merits of the dispute. 6. The Learned Representative for the assessee pointed out that on point of law as also on facts, the impugned order of the Director was untenable inasmuch as the Direct ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Patna); and, (iv) Vishwa Budha Parishad vs CIT, 264 ITR 357 (Patna) 9. We have carefully considered the rival submissions. As our discussion in the earlier paras show, the moot question is as to whether the Director was justified in denying the continuation of recognition under Section 80G of the Act. Sec. 80G of the Act enumerates clauses (i) to (v) which contains various conditions for allowing recognition under Section 80G of the Act. The scope and ambit of the inquiries that are permissible to be made by the Director at the stage of evaluating an application under Section 80G of the Act has been considered by the Hon'ble Punjab Haryana High Court in the case of Sonepat Hindu Educational Charitable Society (supra). As per the Hon'ble High Court, the scope of inquiry by the Director while dealing with an application under Section 80G of the Act extends to eligibility to exemption under various provisions of the Act, referred to in Sub-section (5) thereof, but does not extend to the actual computation of income under the Act. Similarly, in the subsequent judgment in the case of Sewa Bharti Haryana Pradesh (supra), the Hon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed courses in astronomy for students, conducting of study tours, workshops, conference and special events, etc. It was also explained by the Learned Representative that since its inception 20 years ago, assessee-trust has been publishing a bulletin called Khagol Warta in Marathi, which is very well received by the researchers and students of Astronomy. Our attention has also been drawn to the list of publications since 1986, which has been brought out by the assessee-trust. All these aspects, in our view, do not lend support to the perception of the Director that the assessee-trust is not incurring expenditure towards its objects. 11. Even with regard to the level of expenditure incurred by the assessee, we have perused the Income Expenditure statement enclosed by the assessee in the Paper Book for various years and find that the observation of the Director is devoid of factual support. In fact, a perusal of the Income Expenditure Account reveals that the streams of income are on account of library subscription, sale of books, subscription towards its periodicals, donations and annual subscription fee, etc. All these goes to show that assessee is earning income ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not help the case of the Revenue in the present case. 15. Insofar as the judgment of the Hon'ble Allahabad High Court in the case of Vishal Khanna Public Charitable Trust (supra) relied upon by the Ld. DR is concerned, the same, in our view, is also inapplicable in the instant case on account of difference in the fact-situation. In the case before the Hon'ble Allahabad High Court, the object of the Trust was to construct and maintain a charitable hospital, whereas factually it was found that the Trust was diverting monies for construction of a shopping complex. Under these circumstances, the Hon'ble High Court upheld the decision of the Commissioner in denying recognition to the Trust under Section 80G of the Act. Quite clearly, the fact-situation in the instant case stands on an entirely different footing inasmuch as there is no material to say that the activities of the assessee are for any non-charitable purposes. 16. In view of the above discussion, we set-aside the order of the Director with directions to allow the application of the assessee dated 17.06.2008 seeking continuation of recognition granted earlier under Section 80G of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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