9911796707
TMI Blog2015 (1) TMI 155X X X X Extracts X X X X X X X X Extracts X X X X ..... n of registration should be with reference to the objects satisfying definition of charitable purpose at the time of registration and not by subsequent amendment to section 2(15) - since the assessee’s objects and activities are genuine registration cannot be cancelled merely because receipts are exceeding threshold limit as provided under second proviso to section 2(15) of the Act - It is open to the AO to deny exemption u/s 11 on the receipts of the assessee, if the AO feels that activities of the assessee are for general public utility and it is indulging in trade or commerce etc. – thus, the order of the DIT(E) is set aside – Decided in favour of assessee. - I .T.A.No.386/Mds/2012 - - - Dated:- 17-10-2014 - SHRI A.MOHAN ALANKAMONY AN ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xceeded over ₹ 10 lakhs i.e. threshold limit as provided in 2nd proviso to section 2(15) of the Act the exemption granted under section 12AA was withdrawn as the assessee is no more charitable organization and the assessee s objects fall under general public utility and not education. Counsel submits that objects of the assessee is to serve as a forum where Engineers, Scientists, Technologists and Innovators in mobility engineering field can exchange ideas and learn from each other experience and the objects and activities of the institution are educational in nature as it is conducting programme for school children to cultivate engineering background. Counsel submits that assessee conducts Baja competition where undergraduate and pos ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... viso to section 2(15) of the Act. Therefore, counsel submits that even if the activities of the assessee trust fall under general public utility, since its objects are genuine and activities are genuine, registration granted under section 12AA cannot be withdrawn. Counsel places reliance on the decision of Hon ble Madras High Court in the case of Tamil Nadu Cricket Association in Tax Case Appeal No.450 of 2013 dated 21.10.2013. 3. Departmental Representative supports the order of Director of Income Tax (Exemptions) in withdrawing registration granted under section 12AA(3) of the Act. 4. Heard both sides. Perused orders of lower authorities and the case law relied on. The assessee was granted registration under section 12AA of the Act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Tax (Exemptions) appears to be not correct, when the objects of the assessee trust are genuine and assessee is carrying on the activities in accordance with the objects. In this case, activities of the trust cannot be held to be not genuine and it is not the case of the Director of Income Tax (Exemptions) that assessee is not carrying on the activities in accordance with its objects. The only reason for refusing registration was that assessee s receipts are exceeding threshold limit as specified under second proviso to section 2(15) of the Act. 5. The memorandum Explaining the provisions in Finance Bill, 2012 regarding proviso to section 2(15) of the Act reads as under:- Assessment of charitable organization in case commercial rece ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t no exemption would be available for a previous year, to 1 trust or institution to which first proviso of section 2(15) become applicable for that particular previous year. However, this temporary excess in one year may not be treated as altering the very nature of the trust or institution so as to lead to cancellation of registration or withdrawal of approval or rescinding of the notification issued in respect of trust or institution. Therefore, there is need to ensure that if the purpose of a trust or institution does not remain charitable due to application of the first proviso on account of commercial receipt threshold provided in the second proviso in a previous year. Then, such trust or institution would not be entitled to get ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... atisfying definition of charitable purpose at the time of registration and not by subsequent amendment to section 2(15) of the Act. While holding so, the Hon ble High Court observed as under:- Held, allowing the appeal, (i) that there being no dispute raised by the Revenue as to the genuineness of the trust or as to the activities of the trust not being in accordance with the objects of the trust, the question of cancellation under section 12AA did not arise. Registration was granted on March 28, 2003, taking into consideration the objects of the institution fitting in with the definition of charitable purpose defined under section 2(15) and the substitution of the section itself came only in 2008, with effect from April 1, 2009. The ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
