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TMI Blog2018 (3) TMI 85X X X X Extracts X X X X X X X X Extracts X X X X ..... 8-1-2018 - Shri T. S. Kapoor, Accountant Member And Shri Partha Sarathi Chaudhury, Judicial Member Appellant by Shri H. P. Singh, Advocate Respondent by Smt. Alka Singh, D.R. ORDER T. S. kapoor, A.M. This is an appeal filed by the assessee against the order of CIT (Exemptions) passed u/s 12AA of the Act. 2. At the outset, Learned A. R. submitted that assessee is running a school and had been claiming exemption u/s 10(23C)(iii) and now the assessee had applied for registration u/s 12AA which the CIT (Exemptions) has refused relying on the provisions of section 13(1)(c) of the Act. Learned A. R. submitted that at the time of registration u/s 12AA the only aspect which CIT (Exemptions) is expected to examine i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iled at the time of registration. Therefore, it was prayed that CIT (Exemptions) be directed to grant registration to the society. 3. Learned D. R., on the other hand, relied on the order of CIT (Exemptions). 4. We have heard the rival parties and have gone through the material placed on record. We find that is an admitted fact that the objects of the society, as mentioned in the bye-laws placed at page No. 4 of the paper book, are charitable in nature. The CIT (Exemptions) has also not doubted the charitable nature of the objects and he has rejected the application by holding that there was no cogent or corroborative evidence to prove the genuineness of activities whereas the fact remains that the assessee had filed copies of balance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be used in a proper manner, cannot be made a basis for rejection of registration. Hon'ble court has further held that the genuineness of the activities of trust or institution has to be seen keeping in mind the objects thereof which necessarily means that the CIT (Exemptions) shall satisfy himself about the fact that the activities are genuine and in consonance with the objects of the trust or institution. The relevant findings of Hon'ble court are reproduced below: 21. Section 12AA, which lays down the procedure for registration, does not speak anywhere that the CIT, while considering the application for registration, shall also see that the income derived by the trust or the institution is either not being spent for charitable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd exempted to the extent to which such income is applied to such purposes in India but if the income is accumulated or set apart for application to such purposes in India, the same shall not be in excess of fifteen per cent of the income from such property. 23. Sub-section (2) of Section 11 states about a situation where eighty-five per cent of the income referred to in Clause (a) or Clause (b) of Sub-section (i) read with the Explanation to that sub-section is not applied, or is not deemed to have been applied, to charitable or religious purposes in India during the previous year but is accumulated or set apart, either in whole or in part, for application to such purposes in India, and says that in such a situation, such income so accu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ated or set apart or ceases to remain so invested or deposited or credited or paid or, as the case may be, of the previous year immediately following the expiry of the period aforesaid. 25. Section 12 also only says that any voluntary contributions received by a trust created wholly for charitable or religious purposes or by an institution established wholly for such purposes, shall for the purposes of Section 11 be deemed to be income derived from property held under trust wholly for charitable or religious purposes and the provisions of that section and Section 13 shall apply accordingly. The provision thus, emphasizes upon the income of the trust created wholly for charitable or religious purposes or an institution established whol ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ll remain restricted to the examination, as to whether the assessee, who has moved the application for registration under Section 12A, is actually in the activities which are genuine. Genuineness of the activities of the trust or the institution has to be seen, keeping in mind the objects thereof, which necessarily means that the CIT shall satisfy himself about the fact that the activities are genuine and in consonance with the objects of the trust or the institution. In other words, if establishing and running a school is the object of the society, as given in its bye-laws, it has to be satisfied that the society has established the school, where education is being imparted as per rules and the factum of establishment and running school is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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