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TMI Blog2012 (9) TMI 319X X X X Extracts X X X X X X X X Extracts X X X X ..... ities of providing Education by way of setting up school and college, which is one of the recognized object of charitable activity and no evidence having being brought on record, that the said activities of the Trust were not genuine, the said Trust is entitled to Registration u/s 12AA. The satisfaction of conditions of Sec. 11 to 13 is to be gone into by AO, while determining the income of Trust at the time of assessment and not to be gone into by CIT, while granting registration U/s 12AA. On objection that assessee is both Trust and society is recognized system and once it is registered as Trust, provision of election are not applicable to Trusts. The next objection that Trustee and their successor were lifelong member and hence activ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the A.O. and the Joint Commissioner of Income Tax, Range-II, Ludhiana is confronted. Therefore, order of the CIT has been set-aside by the Hon'ble ITAT with the directions to decide the matter afresh. 4. The C IT observed that the assessee was eligible for registration U/s 12AA of the Act prospectively i.e A.Y. 2012-13 but declined registration on the following accounts : a) One of trustee Shri Jasbir Singh had withdrawn a sum of Rs.13,00,000/- on 16/3/2011 from Union Bank of India, Latala which is shown in Balance Sheet as on 31.03.2011 as "Sh. Jasbir Singh Imprest Account". b) The para 9(i) of the Trust Deed provides for life-long membership for Trustee themselves as well as their successors. c) This is strangely a Trust and a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the modes specified in section 11(5). In this view of the matter, an untrue certificate u/s 13(1)(c) was given and also an untrue Audit-Report was given. b) The Assessee is a Trust registered under the Societies Registration Act and not having a provision for elections is an anomaly. Also being a Public Trust, it cannot opt for life-long status for one single Trustee or his heir. c) This is strangely a Trust and also a Society and is governed by different laws. The status of the assessee is very ambiguous as it is a Trust and it is also a society. 7. In view thereof, the CIT under these facts and circumstance, held that the constitution and practices of the Trust are not in consonance with the Indian Law and Practice, particularly In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Surya Educational Cheritable Trust (supra) wherein it has been held as under As per section 12AA an application for registration of the trust and institution is required to be made within one year from the date of creation of the trust or the establishment of such institution. The procedure for registration of the trust or institution is prescribed under section 12AA. In terms of clause (a) of section 12AA, the Commissioner is to satisfy himself about the genuineness of the activities of the trust on such inquiries as he may deem necessary. Sub-section (1A) and (2) of section 12AA are procedural in nature, whereas sub-section (3) of section 12AA empowers the Commissioner to cancel the registration of the trust or institution, if he is sa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... own for excluding the income from consideration under section 10(22) now 10(23)(C) or sections 11 and 12 are not applicable while considering the application for registration under section 12AA. The application for registration is required to be made within one year of the creation of the trust. Section 12AA requires satisfaction in respect of the genuineness of the activities of the trust, which includes the activities which the trust is undertaking at present and also which it may contemplate to undertake. The insertion of sub-section (3) to section 12AA clarifies the said fact, when it empowers the Commissioner to cancel the registration if the activities of the trust are not carried out in accordance with such objects. [Para 10] The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aged in the activities of providing Education by way of setting up school and college, which is one of the recognized object of charitable activit y and no evidence having being brought on record, that the said activities of the Trust were not genuine, the said Trust is entitled to Registration u/s 12AA of the Act. The satisfaction of conditions of Sec. 11 to 13 of the Act is to be gone into by Assessing Officer, while determining the income of Trust at the time of assessment and not to be gone into by CIT, while granting registration U/s 12AA of the Act. The next objection of the C IT is that the assessee is both Trust and society is recognized system and once it is registered as Trust, provision of election are not applicable to Trusts. T ..... X X X X Extracts X X X X X X X X Extracts X X X X
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