2012 (5) TMI 831 - AT - Income Tax

Summary

Issues involved: Application for registration u/s 12AA of the Income-tax Act, 1961 rejected by the ld. DIT(Exemptions), Chennai.

Summary:

Issue 1: Condonation of Delay
The appeal was filed with a delay of six days, and the ld. A.R. requested condonation of the delay, which was granted by the Tribunal based on reasonable grounds presented by the ld. A.R.

Issue 2: Rejection of Registration Application
The main issue raised in the appeal was the rejection of the application for grant of registration u/s 12AA of the Act by the ld. DIT(Exemptions). The applicant, a Trust with charitable objectives, had its registration application rejected on the grounds that the trust's activities aimed at business establishment and profit accumulation, which were deemed non-charitable purposes. The Tribunal heard arguments from both sides, with the assessee claiming the institution was solely of charitable nature, while the ld. D.R. supported the DIT(Exemptions)'s decision.

Issue 3: Tribunal's Decision
After considering the submissions and reviewing the Trust's objectives, the Tribunal found that the Trust's varied objectives did not necessarily indicate a business intent. Citing relevant judicial precedents, the Tribunal concluded that the Trust was entitled to registration u/s 12AA of the Act. The Tribunal directed the DIT(Exemptions) to grant registration to the Trust under section 12AA of the Income-tax Act, 1961.

Conclusion
The Tribunal allowed the appeal of the assessee, emphasizing that any future contravention of provisions related to charities could be addressed during assessment proceedings. The decision was pronounced on May 2, 2012, in Chennai.