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TMI Blog2018 (5) TMI 132X X X X Extracts X X X X X X X X Extracts X X X X ..... isfy himself vis-à-vis the genuineness of the activities carried out by the assessee society in the absence of the income tax returns filed by it in the earlier years. The assessee has not filed income tax returns in earlier years or had for that matter incorrectly claimed exemption u/s 10(23C)(iiiab), may call for some action to be taken as prescribed under the law but that does not and cannot lead to the conclusion that the activities of the assessee society are ingenuine so as to deny registration u/s 12AA of the Act to the assessee society. Similarly, the absence of PAN also cannot be a reason for denying the said registration. Moreover we find no merit at all in the contention of the CIT(E) that the applicant University should have claimed exemption under section 10(23C)(iiiad) or 10(23C)(vi) and not sought registration u/s 12AA so as to claim exemption u/s 11 of the Act. Thus we hold that the application be reconsidered afresh by the Ld.CIT(E) in the light of the conditions to be satisfied as per the provisions of section 12AA of the Act after examining the financial statements and other relevant documents which the Ld.CIT(E) considers necessary for arriving at the prescri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ated that no reason had been given by the applicant society for now seeking registration u/s 12A of the Act and that this was a method to cover up the earlier lapses on the part of the applicant society of not having filed its return of income. The Ld.CIT(E) stated that in the absence of return of income and other relevant documents, it was difficult to appraise the activities of the institution during the past several years and, therefore, there was no way the genuineness of the activities of the applicant society could be corroborated with its stated aims and objects. Ld.CIT(E) further took note of the fact that the applicant society did not have PAN while denying registration to the applicant/ assessee u/s 12A of the Act. The relevant findings of the Ld.CIT(E) in this regard at paras 6 to 8 of the order are as under: 6. The submissions of the applicant vide its letter dated 15.10.2016 reveal that the University is substantially financed (as claimed) by the Government but has never filed its income tax return till date. The applicant has further claimed that the University has been established solely for providing the education in the area by the Government of Punjab and was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .10.2016, has submitted that the University was feeling difficulties in getting donation and that was the reason why it has applied under section 12A first time. Though the applicant did not submit any evidence in support of its claim substantiating the need for such donation. Notwithstanding the above it is also the case that in spite of claiming to be covered u/s 10(23C)(iiiab) no grounds have been projected to merit examination of the applicant's case under a different code namely section 12A involving separate conditionalities. It is clearly a case that this is a method to cover up the applicant's lapses in the past of not filing returns of income. In this case if the applicant university desired to avail the benefits of exemption, it would have been claiming the same under other provisions of the Act under section 10(23C)(iiiad) or 1.0(23C)(vi) as the case may be and definitely not u/s 12AA where the activities of the applicant are being carried out since 1962 and has been failing to file its Income Tax Return for the preceding years. 8. In the absence of return of Income and other relevant documents it is difficult to appraise the activities of the institution d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h would sufficiently prove the genuineness of the activities carried out by it. The Ld. counsel for assessee was further asked that it had come to the knowledge of the Bench that the applicant/assessee was indulging in the activity of providing degrees to old students who could not complete their course or who wanted to improve their marks, by collecting huge fees from them and conducting examination in this regard. The Ld. counsel for assessee was asked as to how such activities could be termed to be in the nature of imparting education and not in the nature of a commercial activity. The Ld. counsel for assessee admitted that it had launched such a scheme so to enable students who could not complete their course due to some reason or wanted to improve their marks to do so by giving them another chance of writing the exams. Ld.Counsel admitted that it was also charging fees for the same. Ld.Counsel contended that the only purpose was to give a chance to such students to obtain degrees or improve their marks which would help them in their career opportunities. A detail of the Numbers of students who have availed the benefit of this scheme was filed before us. 5. The Ld. DR, on th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ax returns filed by it in the earlier years. Further, the fact that the assessee has not filed income tax returns in earlier years or had for that matter incorrectly claimed exemption u/s 10(23C)(iiiab), may call for some action to be taken as prescribed under the law but that does not and cannot lead to the conclusion that the activities of the assessee society are ingenuine so as to deny registration u/s 12AA of the Act to the assessee society. Similarly, the absence of PAN also cannot be a reason for denying the said registration. Moreover we find no merit at all in the contention of the CIT(E) that the applicant University should have claimed exemption under section 10(23C)(iiiad) or 10(23C)(vi) and not sought registration u/s 12AA so as to claim exemption u/s 11 of the Act. All the above sections grant exemption to income of assessees fulfilling certain conditions and can be claimed alternatively. As long as the applicant fulfils the conditions prescribed under the relevant section, it is eligible to claim exemption under any of the sections. No provision has been brought to our notice debarring the claim of an assessee who has earlier claimed exemption under a particular sect ..... X X X X Extracts X X X X X X X X Extracts X X X X
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