COMMISSIONER OF INCOME TAX vs. YADVINDRA PUBLIC SCHOOL ASSOCIATION

212 IN TH THE COMMI

YADVINDRA

CORAM: H

Present: M

* SANJEEV PR

ITA-25 Date of ISSIONER OF INCOME TAX, PA V A PUBLIC SCHOOL ASSOCIATI HON'BLE MR. JUSTICE SANJ HON'BLE MR. JUSTICE SANJ Mr. Amanpreet (A.P.) Singh, Sen for the appellant-Income Tax De Mr. Abhinav Narang, Advocate f ***** RAKASH SHARMA, J. (Oral) Present appeal has been preferr Act, 1961 against the ITAT ord 4/Chd/20, whereby the appeal w ublic School Association, Patiala The respondent/assessee had f the association under section 1 order dated 25.09.2009. The t the society had not been ca e society was not imparting ed eaning of Section 2 (15) of the A oval under Section 10 (23)(vi) of cally entitle the assessee to regi hermore, it was for the assessee ety was carrying out charitable AB AND HARYANA AT RH 53-2011 (O&M) f Decision:09.09.2024 PATIALA ..…...Appellant (s) V/s. ION, PATIALA …......Respondent(s) NJEEV PRAKASH SHARMA NJAY VASHISTH nior Standing Counsel, partment. for the respondent. red under Section 260A of the der dated 28.02.2011, passed in was preferred by the respondent- a. challenged the refusal of 2AA of the Act, passed by CIT, Commissioner of Income Tax arrying on with any charitable ducation as a charitable purpose Act. The society had already been f the Act but mere approval does istration under section 12AA of e to show before the authorities activities. The CIT relied upon ) e n - f , x e e n s f s n Suresh Kumar 2024.09.13 16:52 I attest to the accuracy and integrity of this document

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the judgment v. Children B no charity unl needy. Where surplus gener alimony invol 3. T on the judgm Patiala, ITA relevant extra from "wh syste char exem expr Act of t educ cent Infa in C circ not (O&M) Page 2 of 6 passed by the Supreme Court in Book Trust ; (1992) 3 SCC 390 w less there is an element of subsid eas, in the present case it is app rated by the society, that there lved. The Tribunal in appeal set aside ment passed in Baba Gandha S A No.357/Chandi/2010 & ITA act of the said judgment is reprod "The observations of Hon'ble m para 82 of the aforesaid judg at we want to stress is where a s ematic profits, even though that ritable purposes, yet it cannot b mption" deserves to be read ress provisions of the third prov which stipulate the retention of the total income after quantif cational institution earned in ea t of the total income is spent for act, the judgment rendered by Ho Children Book Trust case (supra umstances of the case of the pet at all applicable by virtue of n Municipal Corporation Delhi wherein, it was held that there is dy or alimonies for the poor and arent from the accounts and net e is no element of subsidy or the order of the CIT(A) relying Singh Education Trust v. CIT A No. 803/Chandi/2009. The duced as under:- e Supreme Court quoted gment to the effect that - society or body is making profit is utilized only for e said that it could claim in conjunction with the iso to S. 10(23)(vi) of the f 15 per cent of the profits ification thereof, of the ach year provided 85 per the objects of the society. on'ble the Supreme Court a) on the facts and in the titioner-society herein, is f the applicability of the i s d t r g T e Suresh Kumar 2024.09.13 16:52 I attest to the accuracy and integrity of this document

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mec the A had the D with com the dete sole 4. T Banda Singh 2011 alongwi Educational Appeal of the Commissione approval of r factors would registration al the case unde the conditions 5. T Commissione scope of Sec registration un shall examine (O&M) Page 3 of 6 chanism contained in the third p Act. It may be clarified that Ho decided the case of Children B Delhi Municipal corporation Ac h the provisions of S. 10(23 (vi) mplete code in itself, interalia pr utilization of surpluses and p ermination of the existence of th ely for educational purposes and

This Court in Commissioner of h Bahadur Education Trust, Fa ith Commissioner of Income-Ta Society, Barnala, ITA No. 21 e revenue and upholding order of er was required to examine the a registration under Section 10 (2 d also be required to be cons lready granted to the educationa er Section 12AA of the Act, of c s provided therein also. The Supreme Court in Ananda S er of Income Tax and Anr., 202 ction 12AA and observed that nder Section 12AA of the Incom e whether the object of the socie proviso to S. 10(23(vi) of on'ble the Supreme Court Book Trust (supra) under ct, 1957 and had not dealt ) of the Act which are a roviding a mechanism for prior to the utilization he educational institution not for making profit." f Income Tax, Patiala v. Baba atehgarh Sahib; ITA No. 94 of Tax, Patiala v. Young Scholar’s of 2011, while dismissing the f ITAT further observed that the aforesaid factors while granting 23C) of the Act and the same sidered for the cancellation of al institutions, while examining course, taking into consideration Social and Educational Trust v. 20 (17) SCC 254 laid down the t for the purpose of allowing me Tax Act ,1961, the authority ety is of charitable nature or not, a f s e e g e f g n . e g y , Suresh Kumar 2024.09.13 16:52 I attest to the accuracy and integrity of this document

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and whether t relevant para th w in C th a in I C u C a g tr tr u 6. Tax is require activities. 7. I Commissione (O&M) Page 4 of 6 the activities being performed b is quoted below:- “12. Since section 12AA pe he trust and not to assess of wha we are of the view that the term ncludes 'proposed activities Commissioner is bound to consi he trust are genuinely charitable activities which the trust propos n the sense that they are in line w In contrast, the position woul Commissioner proposes to cance under sub-section (3) of section Commissioner would be bound to activity or activities actually car genuine being not in accordan rust. Similarly, the situation wo rust has before applying for regi undertaken activities contrary to Thus, at this stage of registratio ed to examine the objectives of In the case of New Noble E er of Income-Tax and anoth by the society are genuine. The ertains to the registration of at a trust has actually done, 'activities' in the provision '. That is to say, a ider whether the objects of e in nature and whether the sed to carry on are genuine with the objects of the trust. ld be different where the el the registration of a trust 12AA of the Act. There the o record the finding that an rried on by the trust are not ce with the objects of the ould be different where the istration been found to have the objects of the trust." on, the Commissioner of Income the trust and genuineness of its Educational Society vs Chief her; (2022) 448 ITR 594 and e e s f d Suresh Kumar 2024.09.13 16:52 I attest to the accuracy and integrity of this document

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Pinegrove I others(2010) the authoritie the Act was o relevant extra “1 1 w C ju a F r r n o a i. 1 1 fa In L r o w th (O&M) Page 5 of 6 International Chairtable Trus 327 ITR (P&H), this Court has h es to cancel the registration gran only prospective and could not act the order is reproduced as und 15.

XXXX XXXX 16. While answering questions o we find that essentially the ITAT ha CIT cancelling the registration o urisdiction and without authority i amendment was made in Section Finance Act of 2010 empowering th registration granted under Sectio reaches to a conclusion that the a not genuine and not being carried objects of the trust or institution. T available as on the day when the C .e. on 02.03.2010. 17. XXXX XXXX 18. Thus, we find that the fact facts of the present case as in t Infrastructure Development Co Limited’s case (supra), the Com registration under Section 12A of th order dated 29.04.2002 and on 2 was not empowered to cancel such he questions of law no. 1, 3 and 4 st vs Union of India and held that the powers available to nted under Section 12AA(3) of be applied retrospectively. The der:- of law nos. 1, 3 and 4 (supra), as held the order passed by the on 02.03.2010 to be without in law. It has stated so as the 12AA(3) of the Act by the he Commissioner to cancel the on 12A of the Act where it activities of the such trust are d out in accordance with the The power was, therefore, not CIT cancelled the registration ts were almost similar to the the aforesaid case Industrial orporation (Gwalior) M.P. mmission had cancelled the he Act dated 13.04.1991 by its 29.04.2002 the Commissioner h registration. In view thereof, are answered in favour of the d o f e Suresh Kumar 2024.09.13 16:52 I attest to the accuracy and integrity of this document

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a T 8. I satisfy that it educational in Since the res whatever earn of education, 12AA as men 9. W Tax Appellate Section 12AA passed by the 10. A

September 9, Ess Kay/archana

Whether speak Whether Repor (O&M) Page 6 of 6 assessee on the basis of judgment Tax, Gwalior (supra).” In the present case, we find tha has already been registered und nstitute and Section 12AA pert spondent institute is a duly re nings it receives are also utilized the institution could not have be ntioned in Ananda Social Educati We, therefore, do not find any e Tribunal holding the responden A. The appeal is accordingly dism ITAT be now done expeditiousl All pending applications also stan [SANJEEV , 2024 [SAN

king / reasoned :

Y rtable

Y in Commissioner of Income- at the institute has been able to der Section 10 (23) (vi) to be an ains to registration of the trust. egistered educational trust and d for the purpose of advancement een denied the benefit of Section ional Trust's case (supra). error committed by the Income nt entitled for registration under missed. Compliance of the order ly. nd disposed of accordingly.

V PRAKASH SHARMA] JUDGE

NJAY VASHISTH] JUDGE Yes / No Yes / No o n . d t n e r r Suresh Kumar 2024.09.13 16:52 I attest to the accuracy and integrity of this document