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TMI Blog2021 (3) TMI 1152X X X X Extracts X X X X X X X X Extracts X X X X ..... e case of Ananda Social and Educational Trust [ 2020 (2) TMI 1293 - SUPREME COURT] held the mandate of the provisions u/s. 12AA of the Act is to examine whether objects of the trust are charitable in nature are not and the activities of the trust are genuine. In the present case as discussed above the CIT(Exemption) did not point out anything against the objects and genuineness of the activities of the trust but however rejected the registration on examination of financial statements of the assessee for the last four years by holding the assessee has made surplus and no taxes paid thereon on such surplus funds. We find that it is a settled principle that the grant of registration and the issue of assessment or exemption u/s. 11 of the A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... i submits that the assessee made an application seeking registration u/s. 12AA of the Act on 24-09-2019. The assessee is a charitable trust registered under Bombay Public Trust Act, 1950 vide registration No. E-6/LATUR dated 17-10-1985. The CIT(Exemption) rejected the application seeking registration basically on one ground that non-payment of taxes on surplus fund and treated the activities of the assessee as non-genuine. Further, he held that the assessee collected various fees and also kept funds idle in FD's without utilizing them for the objects of the trust. The ld. AR submits that the CIT(Exemption) went beyond his purview u/s. 12AA of the Act treating the activities of the assessee as non-genuine and non-utilization of funds for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ubmits that the CIT(Exemption) rejected granting of registration u/s. 12AA of the Act on two aspects, one is, activities of the trust are not genuine wherein the assessee could not pay taxes on surplus funds and placed reliance on Para No. 5 of the impugned order. Further, he submits that there are mismatch of accounts and referred to Para No. 5 of the impugned order and submitted that in the Balance sheet of F.Y. 2018-19 the FD's at ₹ 3.78 Crores were lying in bank accounts which are out of total assets of ₹ 6.18 Crores and there is mismatch compared to Balance sheet as on 31-03-2019 placed at Page No. 13 of the paper book. In reply, the ld. AR submits that the assessee running educational institute in Latur in the name of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on and the issue of assessment or exemption u/s. 11 of the Act are separate and distinct. The process of registration is not on occasion for deciding the issue of exemption of donation u/s. 11 of the Act. The issue of exemption cannot be examined during the process of registration. Therefore, in our opinion, the order of CIT(Exemption) in denying the registration u/s. 12AA of the Act cannot be sustained and the impugned order is set aside. 7. In view of the above, the assessee is entitled to have registration u/s. 12AA of the Act in terms of decision of Hon'ble Supreme Court in the case of Ananda Social and Educational Trust (supra) as relied on by this Tribunal in the case of Sant Zolebaba Sansthan Chikhali. Accordingly, we direct t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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