2012 (3) TMI 679 - AT - Income Tax

Summary

Issues involved: Appeal against the order of Director of Income-tax Exemptions, Chennai regarding eligibility for registration u/s 12AA of the Act based on the objects of the assessee trust.

Issue 1: Eligibility for registration u/s 12AA of the Act

The issue in this appeal was against the action of the DIT in holding that the assessee was not eligible for registration u/s 12AA of the Act due to one of the objects of the assessee trust relating to developing and maintaining places of worship and promoting god consciousness. The assessee argued that the decision of the Hon'ble jurisdictional High Court of Madras in the case of Arulmigu Kamakshi Amman Trust supported their eligibility for registration u/s 12AA. The High Court's decision highlighted that the income derived from property held under trust wholly for charitable or religious purposes should not be included in the total income of the trust, irrespective of whether the trust was created with charitable or religious purposes. The Tribunal, considering this legal provision, allowed the appeal, stating that the law does not disqualify a trust from applying for registration u/s 12AA based on the objects of the trust. Therefore, the Tribunal's decision was upheld, and the assessee was granted registration u/s 12AA of the Act.

In conclusion, the appeal filed by the assessee was allowed, and the DIT was directed to grant registration u/s 12AA of the Act based on the decision of the Hon'ble jurisdictional High Court.