The Tax Publishers2021 TaxPub(DT) 0744 (Ind-Trib) : (2021) 088 ITR (Trib) 0451

INCOME TAX ACT, 1961

Section 12AA

Where the activities carried out by assessee society by way of running hospitals and medical colleges was for the benefit of public and for the students at large and were for charitable purposes only as provided in section 2(15), the impugned order of Principal CIT cancelling the assessee's registration granted under section 12AA(1) deserves to be quashed.

Charitable trust - Cancellation of registration under section 12AA(3) - Charitable purpose -

Assessee filed appeal against the order of Pr. CIT cancellation registration under section 12AA on the ground of that assessee trust did not act in a fair manner and collected donations from parties who were found to be nonexistent.Held: As regards alleged donations received from various concerns mentioned in the impugned order, identity of the alleged donors, genuineness of the transaction of giving donation to the assessee trust was satisfied as most of the alleged donors were either charitable trusts or known to the Directors/Promoters and the transactions were carried out through banking channel and the creditworthiness of the alleged donors was also satisfied as they had sufficient financial strength to provide the donation to the assessee trust. Pr. CIT can only cancel the registration under section 12AA(3) if it is found that the activities of the society/trust are either not genuine or are not being carried out in accordance with its object provided in bye laws. Nothing on record had been brought by way of an independent enquiry by Pr. CIT thereby collecting necessary evidence which can show that the activities of the assessee society were either not genuine or were not being carried out as per the objects of the society which were filed before the registering authority at the time of granting registration under section 12AA. It was therefore established that the activities carried out by assessee society by way of running hospitals and medical colleges was for the benefit of public and for the students at large and were for charitable purposes only as provided in section 2(15). Therefore, the impugned order of Pr. CIT cancelling the assessee's registration granted under section 12AA(1) deserves to be quashed.

REFERRED :

FAVOUR : In assessee's favour.

A.Y. :



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