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TMI Blog2019 (4) TMI 622X X X X Extracts X X X X X X X X Extracts X X X X ..... ome Tax Act, 1961. Therefore, in our opinion, Ld. Pr. CIT has rightly observed that a charitable trust conduct must be at par with its provision of trust deed and as per existing law. Its misconduct and desire to defy rules and norms have been exposed by virtue of the bribe activities. Such incidents cannot be classified as charitable by any reckoning. Such organisations which do not carry any charitable activity, cannot be granted registration. In these facts and circumstances, Ld. Pr. CIT was correctly satisfied that the activities of the trust are not genuine and not being carried out in accordance with the objects of the trust. Due to nexus of corruption by way of bribe and criminal misconduct by the assessee trust, registration of the Trust was cancelled since inception u/s. 12AA(3). We also note that in the case of ACIT-I vs. Agra Development Authority [2018 (2) TMI 756 - ALLAHABAD HIGH COURT] it was observed by the Court that assessee had not obtained registration by practicing fraud or collusion or concealment of any material fact, but in the present case there is nexus of corruption by way of bribe and criminal misconduct by the assessee trust. - Decided against Assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wing the registration granted to the appellant under section 12AA of the Income Tax Act be quashed and appeal of the appellant may kindly be allowed. 2. The brief facts of the case are that the assessee Trust is running a medical college hospital under the name of M/s Gian Sagar Medical College Hospital at Banur, Punjab and Mohali. The assessee trust is registered u/s 12A of the Income Tax Act, 1961 vide CIT-XI, Chandigarh-II, Chandigarh letter F. No. CIT/CHD-II/Tech/3612 dated 2.4.2005 and registered at S.No.89. The assessee-trust is also eligible for tax relief u/s 80G of the I.T. Act, 1961 vide Order dated 07.05.2007. 2.1 During the course of enquiry conducted by DDIT(Inv.), Chandigarh in the case of M/s PACL group of cases on 22.3.2010, it was observed that CBI had issued arrested Sh. Kamaljit Singh, CEO of M/s Gian Sagar Medical College Hospital during his official duty on 22.4.2010 owing to the allegation that he has delivered of ₹ 2 Crore to Dr. Ketan Desai, the then Chief of Medical Council of India through a middleman Sh. J.P. Singh. The same fact was mentioned in the Appraisal Report of the DDIT (Inv.), Patiala. On the basis of enquiry conducted by DDIT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ittee of MCI through a middleman Mr. JP Singh and also on the same date, Dr. Sukhwinder Singh, Vice Chairman of M/s Gian Sagar Medical College Hospital was chargesheeted and arrested by CBI team. Ld. Pr. CIT (Central)-3, New Delhi has observed that the assessee was engaged in the nefarious activities for inducing of fresh batch of students for academic session without the requisite infrastructure and therefore, it is a clear violation of clause (ii) of para 4 of the trust deed, simultaneously, violating the provisions of section 2(15) of the I.T. Act while carrying out of its activity, hence, he rejected the registration u/s. 12A of the Act vide his impugned order dated 27.10.2017. Aggrieved with the impugned order dated 27.10.2017, assessee is in appeal before the Tribunal. 3. Ld. Counsel for the assessee has submitted that learned Pr. Commissioner of Income Tax (Exemptions) has grossly erred both in law and on facts in passing the impugned order dated 27.10.2017 under section 12AA(3) r/w section 12 of the Income Tax Act, 1961, withdrawing registration granted to the assessee under section 12AA of the Income Tax Act, 1961 vide CIT-XI, Chandigarh - II, Chandigarh letter F. No. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... further submitted that the assessee was engaged in the nefarious activities for inducing of fresh batch of students for academic session without the requisite infrastructure and therefore, it is a clear violation of clause (ii) of para 4 of the trust deed, simultaneously, violating the provisions of section 2(15) of the I.T. Act while carrying out of its activity, hence, Ld. Pr. CIT has rightly rejected the registration u/s. 12A of the Act vide his impugned order dated 27.10.2017, which does not need any interference. 5. We have heard both the parties and perused the records especially the impugned order of the Ld. Pr. CIT. We find that during the course of enquiry conducted by DDIT(Inv.), Chandigarh in the case of M/s PACL group of cases on 22.3.2010, it was observed that CBI had arrested Sh. Kamaljit Singh, CEO of M/s Gian Sagar Medical College Hospital during his official duty on 22.4.2010 owing to the allegation that he has delivered of ₹ 2 Crore to Dr. Ketan Desai, the then Chief of Medical Council of India through a middleman Sh. J.P. Singh. The same fact was mentioned in the Appraisal Report of the DDIT (Inv.), Patiala. On the basis of enquiry conducted by DDIT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d an amount of ₹ 2 crore to Sh. Ketan Desai, President of Executive Committee of MCI through a middleman Mr. JP Singh and also on the same date, Dr. Sukhwinder Singh, Vice Chairman of M/s Gian Sagar Medical College Hospital was chargesheeted and arrested by CBI team. It was further observed that Ld. Pr. CIT (Central)-3, New Delhi has noted that the assessee was engaged in the nefarious activities for inducing of fresh batch of students for academic session without the requisite infrastructure and therefore, it is a clear violation of clause (ii) of para 4 of the trust deed, simultaneously, violating the provisions of section 2(15) of the I.T. Act while carrying out of its activity. We further note that the assessee-society was established with the sole intention of helping charitable and philanthropic venture of running medical college and thereby seeking to claim exemption on the income so generated under section 11 and 12 of the I.T. Act. It is further noted that due to nexus of corruption by way of bribe and criminal misconduct by the assessee trust, registration of the Trust was cancelled since inception u/s. 12AA(3) of the Income Tax Act, 1961. Therefore, in our opinio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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