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TMI Blog2025 (5) TMI 1568X X X X Extracts X X X X X X X X Extracts X X X X ..... in the memo of appeal which are interconnected and pertains to the rejection of application filed for regularization of registration under section 12AB of the Act. 3. The facts in brief are that the assessee is a trust established as on 22nd January 2024 through trust deed with the object to empower general public in the field of professionals, entrepreneurship, skill development including social activities such as blood donation, medical camp, providing food, education & medical assistance to needy students. 4. Initially, the assessee obtained provisional registration under section 12A of the Act vide Form 10AC dated 13-02-2024 for a period of 3 years effective from A.Y. 2024-25 to A.Y. 2026-27. Subsequently, the assessee trust filed Fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... considered by the learned CIT exemption. The learned AR before us prayed to set aside the issue to the file of the learned CIT exemption for fresh adjudication as per the provisions of law. 9. On the other hand, the Ld. DR vehemently supported the order of the authorities below. 10. We have heard the rival contentions of both the parties and perused the materials available on record. At the outset, it is pertinent to refer to the provisions of section 12AB of the Act, which provides for registration of trusts and institutions carrying out genuine charitable activities. Section 12AB(1)(a) mandates that the Principal Commissioner or Commissioner shall satisfy himself about (i) the genuineness of the activities, and (ii) the compliance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he objects of the Trust. 10.2 We further note that the Hon'ble Allahabad High Court in the case of CIT vs. Red Rose School reported in [2007] 163 Taxman 19 (All.) held that while granting registration under section 12A of the Act, the ld. Commissioner is not to act as an Assessing Officer and is only required to examine the objects and genuineness of activities based on materials placed before him. The relevant part of the judgment is extracted as under: 33. In regard to the genuineness of the activities of the trust or the institution, whose objects do not run contrary to public policy and are, in fact, related to charitable purposes, the Commissioner is again empowered to make enquiries as he thinks fit. In case the activities are not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lauses from being included in the total income of the previous year of the person in receipt of the income, for example, in sub-clause (1) says 'income derived from property held under trust wholly for charitable or religious purposes, to the extent to which such income is applied to such purposes in India; and where any such income is accumulated or set apart for application to such purposes in India, to the extent to which the income so accumulated or set apart is not in excess of fifteen per cent of the income from such property. 10.3 Thus, it is settled law that the extent of spending or surplus generated cannot, by itself, be a ground for doubting the genuineness of activities. We also were of the view that the question with respect t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ption in terms of sections 11 and 12 are questions which have to be examined by Assessing Officer at stage when it is urged and not by Commissioner while considering application for grant of registration under section 12A - Held, yes" 10.4 Coming to the facts of the present case, the assessee has placed before the authorities, the trust deed evidencing its charitable objectives. There is no material brought on record by the ld. CIT(E) suggesting that the objectives are non-charitable or that the activities undertaken are not genuine. The allegation regarding cash withdrawals by a trustee, without any evidence of diversion for non-charitable purposes, cannot be held sufficient to deny registration. Further, regarding the allegation that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CIT(E) for fresh consideration of the assessee's application on in the light of above discussion and judicial precedence. Hence the grounds of appeal raised by the assessee are hereby allowed for statistical purposes. 11. In the result, the appeal filed by the assessee is allowed for statistical purposes. Coming to ITA No. 106/Bang/2025, an appeal by the assessee 12. We have heard the rival contentions of both the parties and perused the materials available on record. At the outset, we note that the assessee's application for regularization of registration under section 12AB of the Act was also rejected by the learned CIT(E) on the same basis as adopted for rejection of application for regularization of registration under section 80G of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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