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TMI Blog2025 (4) TMI 99X X X X Extracts X X X X X X X X Extracts X X X X ..... ies of the assessee being genuine. 3. On the facts and circumstances of the case, the action of the CIT(E) in denying the registration under section 12AA is bad in law as the same has been concluded only on the basis of nature of receipts by the assessee and not the charitable activities being carried out by it. 4. On the facts and circumstances of the case Id. CIT(E) has erred both on facts and in law in rejecting the application for registration under section 12AB of the Act, arbitrarily rejecting the explanation and evidences brought on record by the assessee. 5. The appellant craves leave to add, amend or alter any of the grounds of appeal." 2. Heard rival submissions and carefully perused the material available on record. 3. The Ld. AR, while reiterating the grounds of appeal, submitted that denial of registration u/s 12AB of the Act by the Ld. CIT(E) is quite erroneous, in the eye of law despite the objects of the assessee being charitable in nature being genuine activity. It is also submitted that the Ld. CIT(E) denied on simply on the basis of nature of receipts by the assessee and absence of charitable activities. 4. The Ld. DR has relied upon the order passed by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aking by Yashpal Singh Malik * Copy of Provisional Financial statements as on 30.09.2022 * Copy of sanction letter of grants to assessee by ICAR and Science & Engineering and Utilization certificate * Copy of publishing agreement with Springer Nature India Private Limited * Copies of identity proof of Yashpal Singh Malik (Secretary General) and Basavaraj (Treasure of the Society) and ITRs filed by them * Copy of detail of vehicle owned by the assessee * Copy of note and documentary evidences submitted to substantiate that charitable activities are being carried out by assessee * Copy of ledgers of IVS for the period 01.04.2019 to 31.03.2020 * Copy of ledgers of IVS for the period 01.04.2020 to 30.09.2022 8. The Ld. CIT(E) observed while deciding application submitted by the assessee / appellant that the activities carried out by the applicant are not charitable. relevant portion of the impugned order are as under: "5. The assessee has provided a copy of agreement with Springer Nature India Private Limited. As per the terms of the agreement the publisher (Springer Nature India Private Limited) shall be responsible for publishing the journal including the entire co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s etc. Therefore, the conditions for grant of registration in the case are not satisfied and hence the present application filed in Form 10AB for grant of registration u/s 12A(1)(ac)(iii) is rejected" 9. In the course of hearing the Ld. AR draws our attention towards circular no. 21/2016, dated 27th May, 2016 issued by Central Board of Direct Taxes (CBDT), regarding cancellation of registration u/s 12AA of the Act, in which certain directions given as under: "4. In view of the aforesaid position, it is clarified that it shall not be mandatory to cancel the registration already granted u/s 12AA to a charitable institution merely on the ground that the cut-off specified in the proviso to section 2(15) of the Act is exceeded in a particular year without there being any change in the nature of activities of the institution. If in any particular year, the specified cut-off is exceeded, the tax exemption would be denied to the institution in that year and cancellation of registration would not be mandatory unless such cancellation becomes necessary on the ground(s) prescribed under the Act. 5. With the introduction of Chapter XII-EB in the Act vide Finance Act, 2016, prescribing spe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... also submitted that a charitable society is that even in the event of earning profits or surplus, such profits or surplus remains with the society itself and again ploughed back into the coffers of the society for furtherance of its charitable objects and hence profits are not distributed to the public individuals of the assessee society. There is no harm in any charitable society earning profits and in this regard the Ld. AR relied upon the order of the Coordinate Bench of ITAT, in the case of M/s Civil Services Institute vs. CIT (Exemption), Lucknow, 2023(9) TMI 836, dated 15, 2023. It is also submitted that the Ld. CIT(E ) has not pointed out single incident where the surplus made by the assessee or any fee collected by it is utilized for any purpose other than the object of society. 13. The Ld. CIT(E) observed in impugned order that the applicant is in receipts of substantial amount in lieu of services provided by it and thus assessee has not been able to substantiate the activities undertaken by it with bills, vouchers, list of beneficiaries etc. so, the conditions for grant of registration in the case are not satisfied. In this regard, the Ld. AR submitted that it is not tru ..... X X X X Extracts X X X X X X X X Extracts X X X X
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