2019 (5) TMI 631 - HC - Income Tax

Grant of registration u/s 12AA - objection of the CIT(E) that the assessee had been claiming exemption u/s 10(23C)(iiiad) and, therefore, should not have filed the application u/s 12AA - ITAT directing the registration to be accorded instead of reverting it back for re-examination - recording of satisfaction Registering Authority - HELD THAT - Assessee was free to avail registration under any alternative provision if more than one alternatives were available and the assessee was eligible for registration u/s 12AA for which it had applied. Regarding the second objection that the assessee when declared as autonomous body should have changed the objects and memorandum of Association, has no force as the facts and circumstances of society and constitution of members remained the same and objects of the society also remained the same and the only purpose of declaring the society as autonomous body was that it should be run as an autonomous body with the rules laid down by the All India Council of Technical Education. The amendment in the byelaws of the society had nothing to do with the objects of the society which undoubtedly were charitable in nature. At the time of registration of a society u/s 12AA, the only requirement was that the CIT(E) should be satisfied about the objects and genuineness of the activities of the society. In the present case, the CIT(E) has not doubted the objects and genuineness of the activities of the society which were charitable in nature. No illegality or perversity could be pointed out by learned counsel for the revenue in the findings recorded by the Tribunal which may warrant interference by this Court. No substantial question of law arises in the appeal. Consequently, finding no merit in the appeal, the same is hereby dismissed.

Summary

Issues:
1. Appeal filed by the revenue under Section 260A of the Income Tax Act, 1961 against the order passed by the Income Tax Appellate Tribunal.
2. Questions of law regarding registration under Section 12AA of the Act and eligibility for different exemptions.
3. Examination of objections raised by the Commissioner of Income Tax (Exemptions) regarding the society's eligibility for registration under Section 12AA.

Analysis:
1. The appeal was filed by the revenue challenging the order of the Income Tax Appellate Tribunal directing registration under Section 12AA of the Income Tax Act. The Tribunal allowed the appeal of the assessee and directed the Commissioner of Income Tax (Exemptions) to grant registration. The Tribunal considered various substantial questions of law raised by the revenue, including issues related to the eligibility for different exemptions and the satisfaction of the Registering Authority. The Tribunal found no merit in the revenue's appeal.

2. The Tribunal addressed objections raised by the Commissioner of Income Tax (Exemptions) regarding the society's eligibility for registration under Section 12AA. The Tribunal noted that the society was free to avail registration under any alternative provision if eligible. It emphasized that the society's objects and constitution remained the same even after being declared an autonomous body. The Tribunal also highlighted that the society's charitable nature and genuineness of activities were not in question, satisfying the requirements for registration under Section 12AA.

3. The Tribunal further examined objections related to the society running a school not reflected in the bylaws. It clarified that the objects of the society included providing education, which encompassed running a school. The Tribunal cited government notifications and similar cases where registration was granted under similar circumstances. It emphasized that the Commissioner should be satisfied with the society's objects and genuineness of activities for registration under Section 12AA. The Tribunal found no illegality or perversity in its findings, dismissing the revenue's appeal and allowing for future action if the activities of the assessee were found to be non-compliant with the Act.