M/S. SAKUNTALA DEVI FOUNDATION FOR CANCER RESEARCH & TREATMENT (SDFCRT),KHURDA vs. CIT(EXEMPTION), HYDERABAD

1 ITA No. 317/CTK/2015

IN THE INCOME TAX APPELLATE TRIBUNAL, CUTTACK BENCH, CUTTACK

BEFORE S/SHRI N.S SAINI, ACCOUNTANT MEMBER AND PAVAN KUMAR GADALE, JUDICIAL MEMBER

ITA No. 317/CTK/2015

M/s. Sakuntala Devi Foundation Vs. CIT (Exemption), Camp for Cancer Research & Office, Bhubaneswar. Treatment, Ramachandrapur Bazar, Thana Chawk, PO: Jatni, Khurda-752050 PAN/GIR No.AANTS 1300 A (Appellant) .. ( Respondent)

Assessee by : Shri Gouri Mohan Rath, AR Revenue by : Shri Kunal Singh, CIT DR

Date of Hearing : 24/10/ 2017 Date of Pronouncement : /10/ 2017

O R D E R Per N.S.Saini, AM This is an appeal filed by the assessee against the order of the CIT

(Exemption), Hyderabad, dated 27.4.2015.

(Exemption), Hyderabad erred in refusing to grant registration u/s.12AA

of the Act.

Form No.10A on 29.10.2014 before the Commissioner of Income Tax,

Bhubaneswar for grant of registration u/s.12AA of the Act. The

CIT(Exemption) refused to grant registration to the assessee by observing

as under:

2 ITA No. 317/CTK/2015

“Such submission of the said trustees is not satisfactory and hence not acceptable. As per object clause (c), the trustees are empowered to carry on any activity falling under advancement of any object of general public utility. Further, as per the said object clause (f), the trustees are empowered to add such other objects i.e. new objects in future, as may be necessary i.e. as may be decided by them. Thus, the trustees are empowered to carry on new objectives at their direction in future. Under these circumstances, thus having regard to such object clauses mentioned in the trust deed, it may be noticed that the entire objects in the case of the applicant trust are not verifiable. In other words the entire objects in the case of the assessee trust are not amenable to verification. Thus having regard to the provisions contained in Sec. 12AA(1)(b) read with clause (i) & (ii) thereunder, and as in the instant case, I am not satisfied about the objects in the case of the applicant trust, it cannot be granted registration u/s.12AA of the Act. For the reasons stated above, thus the applicant trust cannot be granted registration u/s.12AA of the Act. Hence, registration sought u/s.12AA of the Act, is refused to the above trust. Thus, the said application in Form No.10A filed by the applicant is rejected.” 4. Before us, ld A.R. of the assessee filed copy of the order of this

Bench of the Tribunal dated 26.4.2017 passed in ITA No.442/CTK/2015 in

the case of Centre for the Sustainable Use of Natural and Social

Resources (CSNR) VS. CIT (Exemption), Hyderabad and submitted that

the Tribunal in that case observed that…-

7…... “when we peruse the impugned order passed by the CIT in entirety, it leads to the conclusion that the CIT has not disputed charitable nature of the society except object clause 3.1 and 3.2. In case, any object clause is not of charitable nature and is detrimental to the other charitable activities being performed by the trust either registration can be withdrawn or expenses to that extent can be disallowed by the AO. Furthermore, in case no activities are reported during the F.Y. 2012-13 as mentioned by CIT, it cannot debar the assessee trust to get registration u/s.12A of the Act because mere registration does not provide licence to the trust to claim exemption of expenses without carrying out any activity.

3 ITA No. 317/CTK/2015

identical to the facts which were in the case of Centre for the Sustainable

Use of Natural and Social Resources (CSNR)(supra) and, therefore, the

CIT (Exemption) should be directed to grant registration.

CIT(Exemption).

available on record, we find that the CIT(Exemption) in the instant case

refused to grant registration u/s.12AA of the Act to the assessee trust as

according to him, as per object clause (c) the trustees are empowered to

carry on any activity falling under advancement of any object of general

public utility and that as per object clause (f), the trustees are

empowered to add such other objects i.e. new objects in future, as may

be necessary i.e. as may be decided by them. The trustees are

empowered to carry on new objectives at their discretion in future.

Therefore, the entire objects in the case of the assessee trust are not

verifiable. In our considered opinion, while considering the application for

grant of registration u/s.12AA of the Act, the CIT (Exemption) is not

required to look into the activities, where such activities have not or are

in the process of its initiation. At this stage, only the genuineness of the

objects have to be tested and not the activities unless such activities have

4 ITA No. 317/CTK/2015

commenced. Compliance of the provisions of section 11,12 & 13 has to

be examined by the Assessing Officer at the time of doing the

assessment. If he finds any violation of the same, he can deny

exemption to the assessee.fs The CIT (E) after examining the objects of

the trust have not brought any material to show that the objects of the

trust are not charitable or are not genuine. Therefore, in our considered

view, the CIT (Exemption) was not justified in refusing to grant

registration u/s.12AA of the Act to the assessee trust. Hence, we set

aside the order of the CIT(Exemption) and direct him to grant registration

u/s.12AA of the Act to the assessee trust from the date of application and

allow the appeal of the assessee.

SR.PRIVATE SECRETARY ITAT, Cuttack

5 ITA No. 317/CTK/2015