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TMI Blog2012 (6) TMI 515X X X X Extracts X X X X X X X X Extracts X X X X ..... - Dated:- 17-5-2012 - H.L. KARWA, T.R. SOOD, JJ. Sudhir Sehgal for the Appellant. N.K. Saini for the Respondent. ORDER H.L. Karwa, Vice-President This appeal filed by the assessee is directed against the order of CIT-I, Ludhiana dated 5.12.2011 passed u/s 80G(5) of the Income-tax Act, 1961 (in short 'the Act') read with Rule 11AA(5) of Income-tax Rules, 1962. 2. In this appeal, the assessee has raised the following grounds:- 1. That the Learned CIT-I, Ludhiana has erred in law and on facts by rejecting the permission granted to the assessee being a Charitable Trust U/s 80G(5) of the Income Tax Act, 1961 read with rules without making an objection on the registration granted Under Section 12 AA of the Act. 2. That the learned CIT-I, Ludhiana has erred in law and on facts by not considering the reply of assessee in his order and suo-moto rejected the permission granted to the assessee for being a Charitable Trust u/s 80G of Income Tax Act, 1961. 3. That the learned CIT-I, Ludhiana has erred in law and on facts in withdrawal of exemption u/s 80G without fulfilling the requirements of the law such as issuance of show cause notice, compliance of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ust Sd/- President" 5. The Ld. CIT did not grant approval u/s 80G(5) of the Act and rejected the application moved by the assessee, observing as under:- "10. In this regard reply filed by the assessee has been considered. The last sub para of para 5 as quoted supra makes the situation clear that registration is perpetuity would be applicable to those trusts or institutes who had received the registration u/s 80G subsequent to 1.10.2009. In this case the last registration was granted on 25.6.2008. Hence, perpetuity is not applicable in the case of the appellant Trust. Also, the Commissioner has power u/s 12AA (1)(b)(ii) to withdraw the approval if he is satisfied that the activities of such institution or fund are not genuine or are not being carried out in accordance with the objections of the institution or fund. I have discussed above in detail, why there would be problems in carrying out the genuine charitable activities. This has been discussed in detail in paras, 5, 6, 7, 8, 9,10 and 11. Hence, exemption u/s 80G(5) of the Income-tax Act, 1961 cannot be allowed to the applicant Trust and Application is hereby rejected.' 6. Now the assessee is in appeal before the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n vide order dated 7-12-2006 from 1-4-2006 to 31-3-2008 and finally vide order dated 16-9-2008 from 1-4-2008 to 31-3-2010 by the ld. Commissioner of Income-tax-I, Lucknow. The copies of the said orders are placed at pages 41, 40 and 39 respectively of the assessee's paper book. Earlier as per provisions contained in clause (vi) to sub-section (5) of section 80G, the approval was to be granted by the ld. Commissioner of Income-tax in accordance with Rules prescribed in Rule 12AA of the Income-tax Rules, 1962 and as per the proviso to section 80G(5)(vi) of the Act, the approval was to be renewed from time to time. However, considering the hardship, the Legislature in all its wisdom has sought to omit this proviso on 1-10-2009 vide its Finance (No. 2) Act, 2009. Therefore now approval once granted shall continue to be valid in perpetuity. In the instant case, the approval was granted to the assessee up to 31-3-2010, therefore, in view of the aforesaid omission of the proviso to section 80G(5)(vi) of the Act vide Finance (No. 2) Act, 2009, the approval once granted shall continue to be valid in perpetuity. The memo explaining the provisions in Finance (No. 2) Bill, 2009 as reported in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o have been extended in perpetuity unless specially withdrawn. However, in case of approvals expiring before 1st October, 2009, these will have to be renewed and once renewed these shall continue to be valid in perpetuity, unless specifically withdrawn." 12. The aforesaid Circular is in favour of the assessee and even if the assessee by ignorance or inadvertently filed an application for renewal, the CIT was required to decide the same in accordance with the amended provisions. As regards to the contention of the ld. D.R. that the provisions contained in section 293C of the Act enables the CIT to withdraw approval is concerned, it is noticed that the said section has been inserted by the Finance (No. 2) Act, 2009 with effect from 1-10-2009 i.e., from the date on which provisions of section 80G(5)(vi) has been withdrawn, the provisions contained in section 293C read as under :- "293C. Where the Central Government or the Board or an income-tax authority, who has been conferred upon the power under any provision of this Act to grant any approval to any assessee, the Central Government or the Board or such authority may, notwithstanding that a provision to withdraw such approval ha ..... X X X X Extracts X X X X X X X X Extracts X X X X
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