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TMI Blog2016 (6) TMI 499X X X X Extracts X X X X X X X X Extracts X X X X ..... object of the trust as the case may be. The ld CIT has not found any infirmity in the activities carried out by the RCA as non- genuine or not being carried out as per object of the trust. It is also a fact that the game of cricket become very potential with reference to revenue compared to other games, therefore, the revenue generated by the RCA are substantial but this ground cannot be used to cancel the registration granted by the ld CIT as predominant object of the trust is charitable and substantial revenue generated is incidental to the main object. If, the ld Assessing Officer found any violation in application of fund, he can make disallowance U/s 11 of the Act. Thus, we are of the considered view that the ld CIT was not right in withdrawing the registration granted U/s 12A of the Act. - Decided in favour of assessee. - ITA No. 544/JP/2013 - - - Dated:- 9-6-2016 - Shri T. R. Meena, AM And Shri Laliet Kumar, JM For the Assessee : Shri Kapil Goyal(Adv) For the Revenue : Shri M.S. Meena (CIT) ORDER Per T. R. Meena, A. M. This is an appeal filed by the assessee against the order dated 28/03/2013 of the learned CIT(A)-I, Jaipur for A.Y. 2005-06. The eff ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ell as on the facts of the case in recording the findings adverse to the appellant trust which are contrary to the facts and material already on record and therefore, such finding kindly be negated/ quashed. 8. The Id. CIT, Jaipur-I, Jaipur further erred in law as well as on the facts of the case in making adverse comments for earlier years which were completely unwarranted being out of the scope of Sec.12AA(3) of the Act and thus without jurisdiction. Hence, such findings be declared void or be reversed. 2. All the grounds of the appeal are revolving around withdrawing of registration granted U/s 12A of the Income Tax Act, 1961 (hereinafter referred as the Act) by the ld Commissioner of Income Tax, Jaipur. The ld CIT observed that the registration U/s 12A of the Act was granted on 25/11/2988 to Rajasthan Cricket Association (in short the RCA) on the basis of memorandum 17th February, 1987 and the rules of the RCA containing the objects of the assessee as in force at that time. The objects of the RCA had under gone changes in the year 1999 and 2005 and therefore, it was incumbent upon the assessee to seek fresh registration on the basis of the amended memorandum and rules. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (4) RCA s activities are not commercial. (5) No commercial activity under amended section 2(15). After considering the assessee s reply, the ld CIT had made comparison between the objects as per Memorandum of Rules of Association 1999 and objects of 2005 on page 3 to 6 of the CIT order. After comparing the object of both the memorandum, the ld Assessing Officer held that there cannot be said that there is no substantial amendment in the constitution of the assessee. The object of the Trust had been changed twice i.e. first in 1999 and second time in 2005, which are substantial in nature. He further held that the assessee should have applied a fresh registration after amending the object of the Trust Had it not been so, Registrar of societies would have not threatened to cancel the registration if the changes are not made as per the provisions of Rajasthan Sports (registration, Recognition and Regulation of Association) Act, 2005. Consequent upon changes the scope of activities is enhanced. As per main objects of the Trust underwent changes, assessee was required to apply freshly for registration U/s 12A/12AA. This view is supported by the decision of the Hon ble Allahab ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Act only. But the above clauses of the assessee in any manner and in any way and manner as may be decided upon from time to time are not as per provisions of the Act. He further relied on the decision of Hon ble ITAT B Bench, Mumbai in the case of Board of Control for Cricket in India (BCCI), Mumbai Vs ITO in ITA No. 1285/Mum/2010 vide order dated 30/03/2012, wherein the Hon ble ITAT has held as under:- We are of the opinion that the registration granted under section 12A, on 12th Feb, 1996, and the benefits flowing therefrom, cannot be extended to the amended objects of the society unless the DIT examines the same and comes to a conclusion that the registration under section 12A, can be extended to the revised objects, memorandum and by-laws. It would be illogical to hold that once an institution is registered under section 12A, no matter whatever may be the changes in the objects, rules and regulations, for any number of times, the institution should be given the benefit of section 11 to 13 of the Act, in view of the original registration granted under section 12A. In our opinion, the assessee society should approach the registering authority with the changes an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment of charity in the conduct of RCA. He further considered the annual accounts for F.Y. 2007-08 under the various heads and held that the assessee had let out hostel situated near SMS Stadium on following consideration: The RCA will receive fees of ₹ 75,000/- (Rupees Seventy Five thousands only) per month from the service provider as for grant of facilities to the service provider. This sum shall be enhanced by @ 15% per year for each subsequent year. Therefore, agreement made between RCA and Hotel Radiant Star Hospitalities Pvt. Ltd., Jaipur is commercial. Therefore, the assessee s registration is liable to be withdrawn. 2.5 He further considered the amended provision of Section 2(15) of A.Y. 2009-10 and onward. The assessee got registration from 1988 being charitable organization engaged in the promotion of sports, which is last limb of definition of charitable purpose given U/s 2(15) of the Act. He further analysed the annual account for the F.Y. 2007-08 under the various heads and found that motive of RCA is profit making. Therefore, he withdrew the registration granted w.e.f. A.Y. 2009-10 and onwards. The main and predominant object of any organization is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ainly bad. The issue involved is no longer res-integra and is squarely covered in assessee s favour by following direct decision of Hon ble Mumbai ITAT B Bench in the case of Bhansali Trust wherein the Hon ble Tribunal held that not intimating the amended object in the trust deed to the department cannot ipso facto lead to cancellation of registration because the statutory requirement of cancellation of registration contained in Section 12AA(3) of the Act. He further relied on the following case laws:- (i) Shri Sanmukhananda Fine Arts Sangeetha Sabha in ITA No. 1849/Mum/2011 order dated 09/09/2011 (Mum Trib) (ii) M/s Krupanidhi Educational Trust in ITA No. 86/Bang/2012 order dated 14/09/2012 (Bang Trib). (iii) Tamilnadu Cricket Association Vs DIT (E) (2013) 40 taxmann.com 250/360 ITR 633 (Mad). (iv) Delhi District Cricket Association Vs. DIT(E) 38 ITR (Trib) 326 (ITAT Del). (v) Punjab Cricket Association in ITA No. 834/Chd/2012 order dated 19/10/2015. (vi) All India Football Federation in ITA No. 6352/Del/2013 order dated 23/09/2015 (ITAT Del). (vii) Gujarat Cricket Association in ITA No. 93/Ahd/2011 order dated 31/01/2012 (ITAT Ahd.) The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 013 does not show any fundamental deviation from the original charitable activities to non-charitable activities. The assessee s object to promote the cricket in the State by providing/involving various activities at the district level to state level through coaching provided by coaches, ground and facilities etc. Therefore, the assessee s activities are charitable. The other activities are incidental or conducive of the main activity. The case laws referred by the assessee particularly the Hon'ble Delhi High Court decision in the case of Mool Chand Khairati Trust (supra) is squarely applicable as the assessee amended the provisions, does not change the character of the assessee from charitable to non-charitable or commercial. At the time of registration, the ld CIT has to consider Section 12AA(3) and he has to consider two conditions for rejection of registration granted (i) the activities of the trust are not genuine, (ii) are not being carried out in accordance with the object of the trust as the case may be. The ld CIT has not found any infirmity in the activities carried out by the RCA as non- genuine or not being carried out as per object of the trust. It is also a fact t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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