2018 (5) TMI 1815 - HC - Income Tax

Charitable activities - Grant of registration to the respondent u/s 12-A - Held that - The respondent is a society constituted by the Government for imparting training to various officers/officials involved in the criminal justice system with no profit motive at all and whatever funds are generated or received in aid are utilized for the aforesaid public purpose. It cannot be said that there is any commercial motive and the application for registration granted under Section 12-A of the Act cannot be said to be erroneous. No substantial questions of law.

Summary

Issues:
Grant of registration under Section 12-A of the Income Tax Act, 1961 to a society for imparting training to government officials in correctional administration.

Analysis:
The appeal before the High Court was against the order passed by the Income Tax Appellate Tribunal, Division Bench, Chandigarh. The appellant raised substantial questions of law regarding the grant of registration to the respondent society under Section 12-A of the Income Tax Act, 1961. The first issue raised was whether the activities of the society could be considered as advancement of any other object of general public utility, as contested by the Commissioner of Income Tax (CIT). The ITAT had held that the genuineness of the society's activities was not in doubt and directed the grant of registration. The second issue was related to whether imparting training to government officials in correctional administration could benefit prisoners and be considered as advancement of public utility, contrary to the CIT's view. The ITAT had found that such training would lead to positive changes in prisoner behavior. The third issue questioned the ITAT's decision to grant registration without re-examining the case in light of its findings.

The respondent society was constituted by the Government with the objective of providing training to officers and officials involved in the criminal justice system. The society operated without a profit motive, utilizing funds generated or received for public purposes. The High Court noted that there was no commercial motive behind the society's activities and the registration granted under Section 12-A of the Act was not erroneous. The Court found that no substantial questions of law arose from the appellant's contentions and subsequently dismissed the appeal.

In conclusion, the High Court upheld the grant of registration to the society under Section 12-A of the Income Tax Act, 1961, emphasizing the public utility nature of the society's activities and the absence of any profit motive. The Court rejected the appellant's arguments challenging the registration and dismissed the appeal, finding no legal issues of substance to be addressed further.