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Issues: Petitioner sought writ of certiorari to quash order refusing recognition as scientific research association u/s 35(1)(ii) of Income-Tax Act, 1961.
Summary: The petitioner institution applied for recognition as a scientific research association under Section 35(1)(ii) of the Income-Tax Act, 1961. The petitioner's counsel argued that despite subsequent amendments to rules and regulations, the core objective of scientific research remained unchanged, and therefore, recognition should not have been denied based on such amendments. The counsel contended that the order of refusal lacked sufficient reasoning and was overly brief. The Revenue's counsel argued that the association was involved in activities beyond scientific research, justifying the refusal of recognition. Upon reviewing the impugned order dated 24th September, 2010, the Court found it lacking in detailed discussion and reasoning, deeming it insufficient. The Court emphasized the necessity of providing cogent reasons in such orders, as reason is fundamental to the validity of an order. Consequently, the Court quashed the order dated 24th September, 2010 and directed the competent authority to conduct a fresh hearing, provide an opportunity for the petitioner to present their case, and issue a new order within three months. The competent authority was instructed to ensure that the new order includes relevant reasons addressing the raised issues. The writ petition was allowed, with each party bearing their own costs.
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