2013 (12) TMI 659 - AT - Income Tax

Refusal to grant registration u/s. 12AA Exemption u/s 80G - The cataract operations and other supporting activities were done through its sister concern M/s. Debipur Netralaya Pvt. Ltd - Held that - M/s. Devipur Netralay Pvt. Ltd did not get any special benefit on account of cataract operation The medical expenses are high to pay Rs. 500/- for per cataract surgery and Rs. 175/- for providing spectacles to the school children and post operative cataract patients - Charitable activity was being done by making use of the facilities of the sister concern - On perusal of the income and expenditure accounts for the various years of the assessee society - The assessee is doing the charitable activities - Decided in favour of the assessee.

Summary

Issues:
- Delay in filing appeals against refusal to grant registration u/s. 12AA and initial exemption u/s. 80G of the I.T Act 1961.
- Eligibility of the assessee for registration u/s. 12AA and exemption u/s. 80G of the Act based on charitable activities conducted through a sister concern.

Analysis:
1. Delay in Filing Appeals:
The appeals were filed by the assessee against separate orders of the Commissioner of Income-tax, Burdwan, regarding the refusal to grant registration u/s. 12AA and initial exemption u/s. 80G of the I.T Act 1961. The delay of 322 days in filing one of the appeals was attributed to a bonafide mistake by the assessee, who believed initially that only one appeal needed to be filed. The condonation petition was filed, explaining the circumstances leading to the delay. The Tribunal, after considering the submissions, found the delay to be genuine and condoned it, proceeding to dispose of the appeals on their merits.

2. Eligibility for Registration and Exemption:
The assessee, a society registered under the West Bengal Registration of Societies Act 1961, engaged in substantial charitable activities. The AR for the assessee presented evidence of various charitable works, including health awareness camps, cataract operations, supply of medicines, books to poor students, health check-ups, and vocational training programs. The denial of registration u/s. 12AA was based on the involvement of a sister concern in cataract operations. However, a Memorandum of Understanding clarified the financial transactions between the assessee and the sister concern, indicating genuine charitable activities. The income and expenditure statements demonstrated significant charitable expenditures exceeding donations received, further supporting the charitable nature of the activities. The Tribunal concluded that the assessee was eligible for registration u/s. 12AA and exemption u/s. 80G of the Act, directing the CIT, Burdwan, to grant the requested registrations and exemptions.

In conclusion, the Tribunal allowed the appeals of the assessee, emphasizing the genuine charitable activities conducted and the eligibility for registration and exemption under the relevant provisions of the Income Tax Act.