2014 (12) TMI 630 - HC - Income Tax

Grant of registration u/s 12AA Charitable purpose u/s 2(15) - charitable activity of imparting education and other allied activities carried by assessee - Held that - The Tribunal has rightly set out the object of the trust in detail and also set out the classes conducted by the trust and the number of students - nearly 80 teaching and non-teaching staffs are also working - the trust is carrying on the objects for which it is established and therefore, the trust is entitled to be registered u/s 12AA - once the object of the trust is fulfilled, the trust cannot be denied the benefit of Section 12AA thus, the order of the Tribunal is upheld Decided against revenue.

Summary

Issues:
1. Appeal against Tribunal's order directing registration under Section 12AA of the Income Tax Act, 1961.

Analysis:
The High Court of Karnataka heard an appeal by the revenue challenging the Tribunal's decision directing the Commissioner of Income Tax to grant registration under Section 12AA of the Income Tax Act to a Trust involved in charitable activities, specifically education. The Trust was established in 1991 and later reconstituted in 1998. It started a school and obtained necessary approvals for construction. The Trust expanded its educational activities over the years, offering classes from 8th to II PUC with around 945 students and employing 80 staff members. The Trust applied for registration under Section 12AA, which was initially declined due to amendments in the Trust Deed. The Tribunal, however, noted the Trust's fulfillment of its objects and directed registration, leading to the revenue's appeal.

The Court reviewed the Trust's activities, emphasizing the fulfillment of its stated objectives and the significant educational operations being carried out. It highlighted the number of classes, students, and staff members, indicating the Trust's commitment to its charitable purpose. The Court noted that deviations, if any, could be addressed separately, but meeting the requirements of Section 12AA should entitle the Trust to registration. Ultimately, the Court found no merit in the revenue's appeal and dismissed it, ruling in favor of the Trust and against the revenue, affirming the Tribunal's decision to grant registration under Section 12AA of the Act.