2005 (11) TMI 40 - HC - Income Tax

Charitable Purposes - Donation renewal of registration of society- petitioner submitted an application and applied before the Commissioner of Income-tax, Meerut, for registration under section 80G r.w.r. 11AA of the Income-tax Rules, having complied with requisite terms and conditions for such registration under section 12AA - we have no doubt, purchase of land is not an activity which may be held beyond the scope of the aforequoted clauses (d) and (m) which are part of aims and objects of the society. It is, therefore, not possible to conclude that the petitioner by purchasing agricultural land indulged in an activity which is beyond aims and objects of the society - Commissioner of Income-tax, Meerut, has erred in law and committed manifest error apparent on the record in concluding that the conditions laid down in section 80G(5), rule 11AA of the Income-tax Rules, were not fulfilled and to thereby rejecting the application for renewal of registration of the society u/s 80G(5)(iv)

Summary

Issues:
1. Registration under section 80G of the Income-tax Act.
2. Renewal of registration under section 80G.
3. Compliance with conditions for registration.
4. Purchase of agricultural land within the aims and objects of the society.
5. Error in the impugned order.

Analysis:
1. The petitioner, a registered society, applied for registration under section 80G of the Income-tax Act and was granted the same for a period of three years. The petitioner later applied for renewal of registration, which was initially extended but faced queries and a show-cause notice before expiration.

2. The petitioner submitted replies and documents supporting its compliance with the necessary conditions for registration renewal. However, the authorities concluded that the conditions were not fulfilled, leading to the rejection of the renewal application under section 80G(5)(iv) of the Income-tax Act.

3. The petitioner argued that the authority should have provided an opportunity to submit required documents and furnish any lacking information. The society's aims and objects, including the purchase of agricultural land, were scrutinized, with the petitioner contending that such activities fell within the scope of its objectives.

4. The court analyzed the society's aims and objects related to educational institutions, laboratories, and other facilities, emphasizing that purchasing agricultural land aligned with these objectives. The impugned order was deemed to contain a manifest error and was set aside, directing a fresh decision after affording the petitioner a proper hearing.

5. Ultimately, the court allowed the writ petition, setting aside the impugned order and instructing a reconsideration of the matter while ensuring the petitioner's right to be heard in accordance with the law. No costs were awarded in this judgment.