2012 (1) TMI 373 - AT - Income Tax

Summary

Issues involved: Appeal against cancellation of registration granted u/s.12AA of the IT Act.

Summary:
The appeal before the Appellate Tribunal ITAT Ahmedabad arose from the Commissioner's order cancelling the registration granted u/s.12AA of the IT Act. The Commissioner found that the activities of the appellant, related to charging fees from users of port facilities, were more akin to a business activity rather than charitable. The Commissioner noted that the aggregate value of receipts exceeded the prescribed limit of Rs. 10 lakhs, leading to the cancellation of registration. The appellant contended that despite the amended provisions, they should still be considered a charitable institution. The Commissioner, however, denied the registration, citing the amended definition of "charitable purpose" u/s.2(15) of the IT Act. The Commissioner invoked section 12AA(3) to cancel the registration, as it empowers the Commissioner to examine if the activities align with the definition of charitable purpose. The Tribunal, after considering relevant precedents, reversed the Commissioner's decision and directed not to cancel the registration u/s.12AA(3) of the IT Act, allowing the appeal.

Key Points:
- Commissioner observed appellant's activities resembled a business, not charitable.
- Registration cancelled due to exceeding prescribed limit of receipts.
- Appellant claimed continued charitable status despite amendments.
- Commissioner invoked section 12AA(3) to cancel registration.
- Tribunal reversed decision based on specific conditions under section 12AA(3) and relevant precedents.