2010 (12) TMI 1031 - HC - Income Tax

Approval of registration - Whether the objective of the society is solely for education? - The burden of establishing that an application in Form 56D was filed, as early as on May 31, 2005, lies heavily on the petitioner - Held that - The jurisdiction exercised by this court under article 226 of the Constitution of India is discretionary, and a writ is not issued as a matter of course - While the petitioner would contend that the original objects were amended in the meeting held on August 13, 2009, and were registered with the Registrar of Societies, Hyderabad, the affidavit filed in support of the writ petition is silent as to the date on which the objects were so registered - One of the limitations imposed by this court, on itself, is that it would not exercise jurisdiction unless substantial injustice has ensued or is likely to ensue - It would not allow itself to be turned into a court of appeal to set right mere errors of law which do not occasion injustice. Ex facie some of the objects of the petitioner-society, as it originally stood, are not solely for the purposes of education. In such circumstances no reason to exercise discretion to interfere, set aside the order of the first respondent, and remand the matter for his consideration afresh, only for him to reject the petitioner s application on the ground that their objects are not solely for the purposes of education.

Issues Involved:
1. Legality of the order dated September 24, 2009, by the first respondent.
2. Approval under section 10(23C)(vi) of the Income-tax Act, 1961.
3. Validity of the petitioner's applications for exemption for the assessment years 2004-05 to 2008-09.
4. Examination of the petitioner's objects in relation to educational purposes.
5. Jurisdiction and discretion of the court under Article 226 of the Constitution of India.

Issue-wise Detailed Analysis:

1. Legality of the Order Dated September 24, 2009
The petitioner sought to declare the order of the first respondent dated September 24, 2009, as arbitrary and illegal. The first respondent granted approval under section 10(23C)(vi) of the Income-tax Act from the assessment year 2009-10 onwards but refused to entertain the application for the assessment years 2004-05 to 2008-09, citing it was beyond the period of limitation prescribed under the fourteenth proviso to section 10(23C)(vi) of the Act.

2. Approval Under Section 10(23C)(vi) of the Income-tax Act, 1961
The petitioner, a society registered under the Andhra Pradesh (Telangana Areas) Public Societies Registration Act, 1350 Fasli, claimed to run various educational institutions and sought exemption under section 10(23C)(vi) of the Act. The first respondent's order dated September 24, 2009, granted approval for the assessment year 2009-10 onwards but rejected the application for earlier years due to the limitation period.

3. Validity of the Petitioner's Applications for Exemption for the Assessment Years 2004-05 to 2008-09
The petitioner claimed to have submitted applications on May 31, 2005, and March 26, 2007, seeking exemption for earlier assessment years. However, the counter-affidavit by the second respondent stated that no such applications were evidenced in their records. The court noted the petitioner's conduct of not following up on their applications timely and found it unreasonable to believe that the applications were genuinely filed on the claimed dates.

4. Examination of the Petitioner's Objects in Relation to Educational Purposes
The original objects of the petitioner included "to organize social services" and "to do needful for the poor children on social grounds," which were not solely educational. The petitioner claimed to have amended these objects on August 13, 2009, but failed to provide evidence of registration of the amended objects. The court emphasized that valid alteration of objects under the A. P. Societies Registration Act, 2001, requires certification by the Registrar, which was not furnished by the petitioner.

5. Jurisdiction and Discretion of the Court Under Article 226 of the Constitution of India
The court highlighted that the jurisdiction under Article 226 is discretionary and not exercised as a matter of course. The court would not interfere unless substantial injustice ensued. Given that the petitioner's original objects were not solely educational, the court found no reason to interfere with the first respondent's order. The court also noted that a writ of mandamus is discretionary and not a matter of right.

Conclusion
The court dismissed the writ petition, concluding that the petitioner's application for exemption for the assessment years 2004-05 to 2008-09 was not validly filed within the prescribed time limit. Additionally, the petitioner's original objects were not solely educational, and the amended objects were not validly registered. Therefore, the relief sought by the petitioner could not be granted. The writ petition was dismissed without costs.

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