TMI Blog2019 (9) TMI 772X X X X Extracts X X X X X X X X Extracts X X X X ..... e actual activities or application of funds, etc. Therefore, at this stage, the only enquiry required to be conducted was with respect to the object of the trust alone. The details called for by the Pr.CIT (E) pertained to matters that may be examined at the stage of assessment. At that stage, if the assessee were to be found to have actually engaged in any noncharitable activity, the benefit of exemption may be denied at that stage in the manner provided by the Act. In the light of above, we are of the opinion that the matter of registration under section 12AA should be set-aside to file of the Pr. CIT(E) for examination the basic facts and pass fresh order - Pr. CIT (E) would give a proper opportunity of being heard and allow the assessee to furnish any material in support of its claim. Assessee's appeal allowed for statistical purposes. - I.T.A No.2831 & 2832/AHD/2017 - - - Dated:- 17-9-2019 - Shri O. P Meena, Accountant Member And Ms Madhumita Roy, Judicial Member For the Assessee : Shri Mehul K Patel, Advocate For the Revenue : Shri O.P. Sharma, CIT(D.R.) ORDER PER O. P. MEENA, AM ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o para 4 of the order of the Pr. CIT (E), in which it was observed that on verification of reply it is noticed that that the Trust proposed to run institution in the name of Doon International Primary School, but no such details, as fee structure, number of students, study in various standards, detail of bifurcation of grants received and fee were received were not furnished. The learned counsel for the assessee refer Paper Book Page No. 1 which is letter dated 10.07.2017 submitted before Pr. CIT (E) in which the assessee trust has clearly pointed out that it is proposed to run the institution. Since the assessee trust has not started functioning therefore, the details as observed by the learned Pr. CIT (E) were not available. Hence, same could not be furnished at the time of registration. The learned counsel for the assessee further placed reliance on the decision of Hon ble Gujarat High Court in the case of Director of Income-tax (Exemption) v. Panna Lalbhai Foundation [2013] 35 taxmann.com 104 (Gujarat) wherein it was held that only because trust has not commenced its activities, Commissioner would have no authority ipso facto reject the application for registra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y the Hon`ble Supreme Court reported at [2018] 96 taxmann.com 607 (SC) has observed as under: 4. Being aggrieved, the assessee carried the matter in appeal before the Tribunal. The Tribunal vide it's order dated 26.07.2013 has allowed the assessee's appeal by following the judgment of a division bench of this Court in the case of Hardayal Charitable and Educational Trust v. CIT [2013] 32 taxmann.com 341/214 Taxman 655/355 ITR 534. In that judgment that is quoted by the Tribunal in its order, this Court had held as below: The preponderance of the judicial opinion of all the High Court including this court is that at the time of registration under Section 12AA of the Income-tax Act, which is necessary for claiming exemption under Sections 11 12 of the Act, the Commissioner of Income Tax is not required to look into the activities, where such activities have not or are in the process of its initiation. Where a trust set up to achieve its objects of establishing educational institution, is in the process of establishing such institutions, and receives donations, the registration under Section 12AA cannot be refused, on the ground that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng charitable purpose' as defined under Section 2(15) of the Act. 6. Thereafter, the Tribunal has found that the assessee was set up to achieve its object of establishing educational institution or trust, which activity per se is a charitable purpose under Section 2(15) of the Act. The Tribunal has then reasoned that at this stage the reasons given by the CIT to reject the application for grant of registration are not valid and those issues may arise separately at the stage of assessment proceedings. 7. Having heard counsel for the parties, we find that registration of the trust does not involve enquiry into the actual activities or application of funds, etc. The Tribunal has committed no error in following the earlier order. At that stage, the only enquiry required to be conducted was with respect to the object of the trust alone. The objection raised by the Commissioner pertain to matters that may be examined at the stage of assessment. At that stage, if the assessee were to be found to have actually engaged in any noncharitable activity, the benefit of exemption may be denied at that stage in the manner provided by the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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