“cancellation of registration”
The decision most relied on for cancellation of registration is Ahmedabad Urban Development Authority v. ACIT (396 ITR 323), cited in 108 judgments on BharatTax.
Leading authorities on cancellation of registration
Development authorities can continue to be regarded as existing for a 'Charitable Purpose' under Section 2(15) of the Income Tax Act, even after the introduction of the proviso to that section. The contention that such authorities automatically lose their charitable status due to the proviso is incorrect.
Funds over which a Development Authority has no control, being used as per State Government directions, are not taxable in its hands. Registration under section 12A is also not conclusive, allowing revenue authorities to examine exemption claims under sections 11 to 13 and cancel registration under section 12AA(3).
Cancellation of registration under Sections 12AA and 80G of the Income-tax Act is justified when a trust misuses its status by returning substantial donations in cash to donors.
The power to cancel registration granted to a trust is not an implied power under the General Clauses Act and requires express legislative provision. An express power to cancel registration was introduced later via amendment.
The Commissioner of Income Tax (CIT) has no power to cancel registration granted under Section 12A of the Income Tax Act retrospectively, especially when there is no express provision in the Act for such cancellation and the order is quasi-judicial in nature.
An order passed by the CIT under Section 12A of the Income Tax Act is quasi-judicial. Until October 1, 2004, there was no express provision in the Act for the CIT to cancel a registration certificate once granted.
The order of the Commissioner of Income Tax (CIT) passed under Section 12A of the Income Tax Act is quasi-judicial in nature. Prior to October 1, 2004, there was no express provision in the Act granting the CIT the power to cancel registration.
The cancellation of registration under section 12AA(3) is limited to circumstances specified in the section. Income and application of funds issues are matters of assessment, not grounds for cancellation under section 12AA(3).