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TMI Blog2019 (1) TMI 989X X X X Extracts X X X X X X X X Extracts X X X X ..... g in accordance with its aims and objects. No doubt, assessee society has entered into a sham transaction by virtue of the sale deeds dated 24.07.2006 and 26.09.2007 qua the land in question in order to misrepresent AICTE to get the approval for setting up a polytechnic college, but this fact has not proved in any manner that the activities of the assessee trust are not genuine or are not being carried out in accordance with its aims and objects. Rather in the remand report it is recorded by the AO that assessee society is running an educational institution having 1000 students on its roll with huge teaching staff and no complaint has been received as to its activities. Contention of the DR that once the addition made by the AO u/s 69 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has grossly erred in withdrawing the registration u/s 12A granted to the assessee society sine 27.12.1999 vide an order u/s 12AA (3) dated 03.09.2015, further followed by an addendum order dated 04.09.2015 u/s 12AA (3) making the withdrawal retrospectively effective from 2008-09 without affording an opportunity. 3. On the facts and circumstances of the case, the grounds on which the aforesaid registration granted to the society has been withdrawn have no substance/merits in law and thus the order of ld. CIT (E) deserved to be quashed. 2. Briefly stated the facts necessary for adjudication of the controversy at hand are : on receipt of the report from the Assessing Officer that the assessee society had disposed off a land belon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... als 19 marlas stood re-transferred to Darshan Singh by the assessee society. It is also not in dispute that the addition of ₹ 7,50,000/- made by the AO u/s 69B has been accepted by the assessee society having not been appealed against. 6. Further, on the other hand, the ld. DR for the Revenue to repel the arguments addressed by ld.AR for the assessee contended that since the CIT (E) had imposed a condition while granting registration u/s 12A of the Act that the assessee society will not transfer its property except with permission, the registration has been rightly cancelled. 7. No doubt, section 12AA (3) empowers the ld.CIT (E) to cancel the registration of any Trust in case, he is satisfied that the activities of such Trust ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... No asset shall be transferred without the knowledge of the undersigned to anyone including to any trust society non-profit company. Since the society has sold the land without the permission of this office and moreover the transaction has not been accounted in the books of accounts which was confronted to the society and the same admitted. There is gross violation of IT provisions. Hence genuineness of charitable activities earned by your society is not established. 2. In light of above facts and non-compliance to the conditions laid down in the registration certificate, you are required in show cause in writing as to why registration granted u/s 12A to the society be not withdrawn in your case. 3. In this regar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fact that since the son of Darshan Singh, owner of the land in question, was working as workshop superintendent in assessee society s college, he has transferred the land in question in the name of assessee society so as to show the total holding of 18.5 acres of land with the assessee society as per conditions laid down by All India Council of Technical Education (AICTE). 11. Though an account payee cheque no.420931 dated 24.07.2006 for a consideration ofRs.7,37,000/- was taken by him but the same was never encashed and possession of the land was also not transferred to the assessee society. AO, in his remand report, has also categorically mentioned that stamp duty for registration of both the sale deeds dated 24.07.2006 26.09.2007 h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssion of land remained throughout with Darshan Singh, it shows the statements of Darshan Singh and Rakesh Chand Bajaj recorded by the AO during remand proceedings that the land in question has merely shown to have been transferred to satisfy the conditions laid down by the AICTE to start a polytechnic college are true and correct and as such, no malafide can be attributed. Rather it was a mutual arrangement between them. 14. In view of what has been discussed above, we are of the considered view that when the assessee society has not become the owner of the land in question, there is no question of indulging in into ingenuine activities or that the activities of assessee society are not being carried out in accordance with the object of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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