BADRI NARAIN KANTA DEVI KATTA CHARITABLE TRUST, JAIPUR V. COMMISSIONER OF INCOME TAX (EXEMPTIONS), JAIPUR

ITA 1212/JPR/2018

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 5649 (ITAT-JAIPUR)
• Duration Of Justice: 9 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-07-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: misc
• Appeal Filed On: 23-10-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: B K GUPTA CIT DHK
• Assessee Lawyers: SAURAV HARSH S
• Keywords: Charitable institution; Competent authority; Set aside
• Section: 80G; 12AA

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCH B, JAIPUR JH JES'K LH- 'KEKZ] YS[KK LNL; ,O A H JH FOT; IKY JKWO] U;KF;D LNL; DS LE{K BEFORE: SHRI RAMESH C. SHARMA, AM & SHRI VIJAY PAL RAO, JM VK;DJ VIHY LA-@ ITA NO. 1212/JP/2018 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2014-15. BADRI NARAIN KANTA DEVI KATTA CHARITABLE TRUST, 101, PEARL IMPERIA, 7, KANOTA BAGH, TAKHT-E-SHAHI ROAD, JAIPUR. CUKE VS. COMMISSIONER OF INCOME TAX (EXEMPTIONS) JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN NO. AADTB 2360 F VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI SIDDHARTH RANKA & SHRI SAURAV HARSH (ADVOCATES) JKTLO DH VKSJ LS@ REVENUE BY : SHRI B.K. GUPTA (CIT) LQUOKBZ DH RKJH[K@ DATE OF HEARING : 23.07.2019. ?KKS'K .KK DH RKJH[K@ DATE OF PRONOUNCEMENT : 30/07/2019. VKNS'K@ ORDER PER VIJAY PAL RAO, JM : THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E ORDER DATED 24.08.2018 OF LD. CIT (EXEMPTIONS), JAIPUR PASSED UNDER SECTION 8 0G(5)(VI) OF THE IT ACT. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS :- 1. THAT IN THE FACTS AND IN CIRCUMSTANCES OF THE C ASE THE LD. COMMISSIONER OF INCOME-TAX, EXEMPTION HAS GROSSLY E RRED IN REJECTING THE APPLICATION FILED BY THE ASSESSEE APP ELLANT FOR SEEKING APPROVAL U/S 80G OF THE ACT. 1.1. THAT IN THE FACTS AND IN CIRCUMSTANCES OF THE CASE THE LD. COMMISSIONER OF INCOME-TAX, EXEMPTION HAS GROSSLY E RRED IN HOLDING THAT NO SIGNIFICANT ACTIVITY HAS BEEN START ED BY THE ASSESSEE APPELLANT AS PER OBJECTS OF THE TRUST AND IN IGNORING THE SUBMISSIONS MADE BY THE ASSESSEE APPELLANT IN T HIS REGARD. 2 ITA NO. 1212/JP/2018 BADRI NARAIN KANTA DEVI KATTA CHARITABLE TRUST, JAI PUR. 2. THE APPELLANT CRAVES LEAVE TO ADD, ALTER, MODIFY OR AMEND ANY GROUND ON OR BEFORE THE DATE OF HEARING. 2. THE ASSESSEE TRUST WAS CONSTITUTED VIDE TRUST DE ED DATED 17.10.2017. THE ASSESSEE APPLIED FOR GRANT OF REGISTRATION UNDER SE CTION 12AA OF THE IT ACT AS WELL AS FOR GRANT OF APPROVAL UNDER SECTION 80G(5)(VI) OF T HE IT ACT VIDE TWO SEPARATE APPLICATIONS IN THE FORM 10A AND 10G RESPECTIVELY B OTH DATED 15 TH FEBRUARY, 2018. THE LD. CIT (EXEMPTIONS) GRANTED REGISTRATION UNDER SECTION 12AA(1)(B) VIDE ORDER DATED 24.08.2018, HOWEVER, THE APPROVAL UNDER SECTI ON 80G(5)(VI) WAS DENIED ON THE GROUND THAT NO SIGNIFICANT ACTIVITY HAS BEEN ST ARTED BY THE ASSESSEE TRUST AS PER THE OBJECTS. 3. BEFORE US, THE LD. COUNSEL FOR THE ASSESSEE HAS SUBMITTED THAT THE LD. CIT (EXEMPTIONS) HAS NOT DISPUTED THE CHARITABLE NATURE OF OBJECTS OF THE TRUST, EVEN BY CONSIDERING THE OBJECTS THE REGISTRATION UNDER SECT ION 12AA(1)(B) WAS GRANTED TO THE ASSESSEE. SINCE THE ASSESSEE TRUST WAS YET TO COMM ENCE THE ACTIVITY, THEREFORE, THE APPROVAL UNDER SECTION 80G(5) WAS DENIED. THE LD. COUNSEL HAS SUBMITTED THAT WHEN THE LD. CIT (EXEMPTIONS) HAS NOT FOUND ANY VIO LATION OF PROVISION OF SECTION 80G(5) THEN THE APPROVAL CANNOT BE DENIED SOLELY ON THE GROUND THAT THE ASSESSEE HAS NOT CARRIED OUT ANY ACTIVITY. IN SUPPORT OF HI S CONTENTION, HE HAS RELIED UPON THE DECISION OF VISAKHAPATNAM BENCH OF THE TRIBUNAL DAT ED 06.12.2017 IN CASE OF MATTAPALI CHALMAYYA CHARITABLE TRUST VS. CIT (E) IN ITA NO. 234/VIZAG/2017 AND SUBMITTED THAT THE TRIBUNAL HELD THAT IF THE ACTIVI TIES OF THE ASSESSEE TRUST ARE GENUINE AT THE STAGE OF COMMENCEMENT OF THE INSTITU TION, REGISTRATION HAS TO BE 3 ITA NO. 1212/JP/2018 BADRI NARAIN KANTA DEVI KATTA CHARITABLE TRUST, JAI PUR. GRANTED AND APPROVAL UNDER SECTION 80G OF THE ACT C AN BE FOLLOWED WITH GRANT OF REGISTRATION. HE HAS ALSO RELIED UPON THE DECISION OF THE COORDINATE BENCH OF THIS TRIBUNAL DATED 11 TH JANUARY, 2017 IN CASE OF KESHAR DEVI GODARA SAMAJI K KALYAN SANSTHAN SINGOR VS. CIT (E) IN ITA NO. 877/JP/2016 AND SUBMITTED THAT ONCE THE REGISTRATION UNDER SECTION 12AA IS GRANTED, THE APP ROVAL UNDER SECTION 80G(5) IS CONSEQUENTIAL IN THE ABSENCE OF ANY CONTRARY MATERI AL OR FACT SHOWING NOT FULFILLING THE CONDITIONS PROVIDED UNDER SECTION 80G(5) OF THE IT ACT. THE LD. COUNSEL HAS ALSO STATED AT BAR THAT NOW THE ASSESSEE HAS ALREADY STA RTED ITS ACTIVITY AS PER THE OBJECTS AND, THEREFORE, APPROVAL UNDER SECTION 80G(5) SHOUL D BE GRANTED. 4. ON THE OTHER HAND, THE LD. D/R HAS SUBMITTED THA T THE BASIC CONDITION OF SECTION 80G(5) IS NOT FULFILLED AS THE ASSESSEE HAS NOT STARTED ANY ACTIVITY AT THE TIME OF FILING THE APPLICATION AND PASSING THE ORDER. T HE LD. CIT (EXEMPTIONS) HAS EXAMINED THE RECORD AND FOUND THAT THE ASSESSEE HAS NOT STARTED ANY ACTIVITY. HE HAS ALSO REFERRED TO RULE 11AA OF THE IT RULES AND SUBMITTED THAT IT IS A REQUIREMENT THAT THE APPLICATION FOR APPROVAL UNDER SECTION 80G (5) SHALL BE ACCOMPANIED WITH THE ORDER UNDER SECTION 12AA OF THE IT ACT. IN THE CAS E OF THE ASSESSEE SINCE THERE WAS NO REGISTRATION UNDER SECTION 12AA AT THE TIME OF S UBMITTING THE APPLICATION, THEREFORE, THE SAID CONDITION OF RULE 11AA IS ALSO NOT FULFILLED. HE HAS RELIED UPON THE DECISION OF LUCKNOW BENCH OF THE TRIBUNAL IN CASE O F CHANDRAWATI DEVI FOUNDATION TRUST VS. CIT (EXEMPTIONS), 64 TAXMANN.COM 33 AND SUBMITTED THAT THE TRIBUNAL HAS CONFIRMED THE ORDER OF THE LD. CIT (EXEMPTIONS) REFUSING THE GRANT OF APPROVAL UNDER SECTION 80G(5)(VI) FOR WANT OF COPY OF REGIST RATION UNDER SECTION 12AA ALONG WITH THE APPLICATION FOR APPROVAL UNDER SECTION 80G (5)(VI) OF THE ACT. THE LD. D/R 4 ITA NO. 1212/JP/2018 BADRI NARAIN KANTA DEVI KATTA CHARITABLE TRUST, JAI PUR. HAS ALSO RELIED UPON THE DECISION OF HONBLE DELHI HIGH COURT IN CASE OF KIRTI CHAND TARAWATI CH. TRUST VS. DIT, 105 TAXMAN 686 (DELHI) AND SUBMITTED THAT THE HONBLE HIGH COURT HAS UPHELD THE ORDER OF REFUSING THE APP ROVAL UNDER SECTION 80G WHEN THE ACTIVITIES OF THE TRUST/INSTITUTION WERE NOT CA RRIED OUT AS PER THE OBJECTS THOUGH REGISTRATION UNDER SECTION 12AA WAS GRANTED TO THE SAID INSTITUTION. HE HAS SUPPORTED THE IMPUGNED ORDER OF THE LD. CIT (EXEMPT IONS). 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AS WELL AS THE RELEVANT MATERIAL ON RECORD. THE LD. CIT (E) HAS NOT DISPUTED THE OBJECT S OF THE ASSESSEE TRUST BEING CHARITABLE IN NATURE. THESE OBJECTS HAVE BEEN REPR ODUCED BY THE LD. CIT (E) IN THE IMPUGNED ORDER AND BASED ON THESE OBJECTS, THE REGI STRATION UNDER SECTION 12AA WAS GRANTED VIDE EVEN DATE ORDER BY THE LD. CIT (EX EMPTIONS). THE ONLY OBJECTION ON WHICH THE APPROVAL UNDER SECTION 80G(5) WAS DENI ED HAS BEEN DISCUSSED IN PARA 4 & 5 OF THE IMPUGNED ORDER AS UNDER :- 4. IN LIGHT OF ABOVE OBJECTS, THE ACTIVITIES COMM ENCED BY THE TRUST WERE EXAMINED. THEREFORE VIDE QUESTIONNAIRE LETTER NO. 8527 DATED 16/22.02.2018 APPLICANT WAS ASKED TO PRODUCE ACTIVI TY DETAILS ALONGWITH EVIDENCES BY Q.NO. 14. IN RESPONSE TO WHI CH AR OF THE APPLICANT FILE WRITTEN REPLY VIDE LETTER DATED 14.0 2.2017 STATED ON THIS ISSUE THAT THE BANK ACCOUNT COULD OPEN LATE AND T RUSTEE SMT. KANTA DEVI KATTA GOT SERIOUSLY ILL AND GOT HOSPITALIZED, FURTHER THE TRUST COULD NOT REGISTERED BY YOUR HONOUR AND NOT GOT 80-G CERT IFICATE SO EFFECTIVE ACTIVITIES COULD NOT BE STARTED NOW WE ASSURES TO D O ACTIVITIES AS PER OBJECTS OF THE TRUST. 5. AS DISCUSSED ABOVE, NO SIGNIFICANT ACTIVITY HAS BEEN STARTED BY THE APPLICANT AS PER THE OBJECTS. THUS, THE BASIC C ONDITION U/S 80G IS 5 ITA NO. 1212/JP/2018 BADRI NARAIN KANTA DEVI KATTA CHARITABLE TRUST, JAI PUR. NOT FULFILLED. CONSIDERING THIS, THE CASE IS NOT F IT FOR GRANTING EXEMPTION U/S 80G AT THIS STAGE. THUS IT IS CLEAR THAT THE LD. CIT (EXEMPTIONS) HAS NOT DOUBTED THE CHARITABLE NATURE OF THE OBJECTS OF THE ASSESSEE TRUST BUT SINCE NO S IGNIFICANT ACTIVITY HAS BEEN STARTED BY THE ASSESSEE, IT WAS HELD THAT THE CONDITION UND ER SECTION 80G(5) IS NOT FULFILLED. IT IS PERTINENT TO NOTE THAT IF THERE IS A SUBSTANT IAL GAP BETWEEN THE REGISTRATION UNDER SECTION 12AA AND THE APPLICATION FOR APPROVAL UNDER SECTION 80G, THEN THE MERE GRANT OF REGISTRATION UNDER SECTION 12AA WILL NOT AUTOMATICALLY CREATE A RIGHT OF GETTING APPROVAL UNDER SECTION 80G(5) OF THE ACT BU T THE LD. CIT (EXEMPTIONS) HAS TO SEE WHETHER THE ACTIVITY OF THE TRUST HAS BEEN CARR IED OUT AS PER OBJECTS AND FOR ACHIEVING THE OBJECTS OF THE ASSESSEE TRUST. IN TH E CASE IN HAND, THE ASSESSEE APPLIED FOR REGISTRATION UNDER SECTION 12AA AS WELL AS APPROVAL UNDER SECTION 80G(5) OF THE ACT ON THE SAME DATE VIDE TWO SEPARATE APPLI CATIONS BOTH DATED 15 TH FEBRUARY, 2018. THEREFORE, THERE WAS NO NEW DEVELO PMENT TO BE VERIFIED BY THE LD. CIT (E) AFTER GRANT OF REGISTRATION UNDER SECTION 1 2AA FOR THE PURPOSE OF GRANTING APPROVAL UNDER SECTION 80G(5) OF THE ACT. ONCE THE OBJECTS OF THE ASSESSEE TRUST ARE FOUND TO BE CHARITABLE, THEN NON-START OF THE ACTIV ITY BY THE ASSESSEE TRUST CANNOT BE A REASON FOR DENIAL OF APPROVAL WHEN ON THE BASIS O F SAME SET OF FACTS, THE REGISTRATION UNDER SECTION 12AA WAS GRANTED BY THE LD. CIT (E). THE SITUATION WOULD HAVE BEEN DIFFERENT IF REGISTRATION WAS GRANTED ON THE BASIS OF THE OBJECTS OF THE TRUST AND SUBSEQUENTLY THE TRUST HAS STARTED ITS AC TIVITY AND ON VERIFICATION IF IT WAS FOUND THAT THE ACTIVITIES OF THE ASSESSEE TRUST ARE NOT BEING CARRIED OUT AS PER THE 6 ITA NO. 1212/JP/2018 BADRI NARAIN KANTA DEVI KATTA CHARITABLE TRUST, JAI PUR. OBJECTS, THEN THE REGISTRATION GRANTED UNDER SECTIO N 12AA WOULD NOT IPSO FACTO VEST A RIGHT FOR APPROVAL UNDER SECTION 80G(5). IN THE CA SE IN HAND, THE LD. CIT (E) HAS NOT FOUND THAT THE ACTIVITIES CARRIED OUT BY THE ASSESS EE TRUST ARE NOT AS PER THE OBJECTS BUT IT WAS NOTICED THAT NO SIGNIFICANT ACTIVITY HAS BEEN STARTED BY THE ASSESSEE TRUST. EVEN OTHERWISE, AS PER THE STATEMENT MADE AT BAR BY THE LD. COUNSEL THAT THE ASSESSEE TRUST HAS ALREADY STARTED ITS ACTIVITY, TH EN THE SAID OBJECTION OF THE LD. CIT (E) IS ALSO COMPLIED WITH BY THE ASSESSEE. AS REGAR DS THE REQUIREMENT OF THE ORDER GRANTING REGISTRATION UNDER SECTION 12AA TO BE ANNE XED WITH THE APPLICATION FOR APPROVAL UNDER SECTION 80G(5) WHEN THE ASSESSEE HAS APPLIED ON THE SAME DATE AND THE REGISTRATION WAS GRANTED BY THE LD. CIT (E) UND ER SECTION 12AA AT THE TIME OF REFUSAL OF THE APPROVAL UNDER SECTION 80G, THEN THE SAID CONDITION AS PROVIDED UNDER RULE 11AA STANDS SATISFIED AS THE ORDER OF GRANTING APPROVAL UNDER SECTION 12AA WAS ALREADY WITH THE LD. CIT (E) AT THE TIME OF PASSING THE IMPUGNED ORDER. THE PURPOSE AND REQUIREMENT OF ACCOMPANYING THE ORDER GRANTING REGISTRATION UNDER SECTION 12AA IS TO MAKE AVAILABLE SUCH ORDER FOR VERIFICATI ON AND CONSIDERATION OF THE COMPETENT AUTHORITY AT THE TIME OF CONSIDERING THE APPLICATION FOR GRANT OF APPROVAL UNDER SECTION 80G(5). HENCE ONCE THE ORDER OF GRAN TING REGISTRATION UNDER SECTION 12AA WAS ALREADY WITH THE LEARNED CIT (E), THEN THE CONDITION PROVIDED UNDER RULE 11AA IS SATISFIED. AS REGARDS THE DECISION RELIED U PON BY THE LEARNED D/R IN THE CASE OF KIRTI CHAND TARAWATI CH. TRUST VS. DIT (SUPRA), IN THE SAID CASE THE COMMISSIONER CONDUCTED A SPOT ENQUIRY AND WAS FOUND THAT THE TRUST BEING ENGAGED MAINLY IN THE CONSTRUCTION OF RELIGIOUS TEM PLE WHEREIN NO CHARITABLE ACTIVITY WAS BEING CARRIED ON. THUS IT WAS A FINDING OF FAC T THAT THE ACTIVITIES OF THE ASSESSEE 7 ITA NO. 1212/JP/2018 BADRI NARAIN KANTA DEVI KATTA CHARITABLE TRUST, JAI PUR. WERE NOT CARRIED OUT FOR ANY CHARITABLE WORK. IN T HE CASE IN HAND, NO SUCH ALLEGATION HAS BEEN MADE BY THE LD. CIT (E) THAT ASSESSEE HAS CARRIED OUT ANY ACTIVITY WHICH IS NOT CHARITABLE IN NATURE BUT THE ONLY OBJECTION IS THAT THE ASSESSEE HAS NOT STARTED ANY SIGNIFICANT ACTIVITY. THE VISAKHAPATNAM BENCH OF THE TRIBUNAL IN CASE OF MATTAPALI CHALMAYYA CHARITABLE TRUST VS. CIT (E) (S UPRA) HAS CONSIDERED AN IDENTICAL ISSUE IN PARA 5 AS UNDER :- 5. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIO NS AND PERUSED THE RECORDS. THE DECISION OF THE ITAT, LUCKNOW BENCH IS NOT APPLICAB LE TO THE CASE ON HAND SINCE, IN THE AFOREMENTIONED CASE, THE CLAIM OF THE ASSESSEE WAS REJECTED BY THE TRIBUNAL ON THE GROUND THAT FOR GRANT OF APPROVAL, COPY OF REGI STRATION GRANTED U/S 12AA OF THE ACT HAS TO BE ANNEXED AND FOR SUCH PURPOSE, REGISTR ATION ON AN EARLIER DATE IS OBLIGATORY. HOWEVER, IN THE INSTANT CASE, THE LD. C OMMISSIONER HAS ALREADY GRANTED REGISTRATION U/S 12AA OF THE ACT AND APPROVAL U/S 8 0G WAS NOT REJECTED ON THE GROUND OF NOT OBTAINING REGISTRATION U/S 12AA OF TH E ACT BUT ONLY ON THE LIMITED GROUND THAT NO ACTIVITY HAS BEEN CARRIED OUT. THE D ECISION OF THE ITAT KOLKATA BENCH, AS RIGHTLY BEEN POINTED OUT BY THE LD. COUNSEL, SUP PORTS THE STAND OF ASSESSEE THAT IF THE ACTIVITIES OF THE TRUST ARE GENUINE, AT THE STA GE OF COMMENCEMENT OF INSTITUTION, REGISTRATION HAS TO BE GRANTED AUTOMATICALLY AND CL AIM U/S 80G OF THE ACT CAN BE FOLLOWED WITH GRANT OF REGISTRATION. LD. COMMISSION ER (EXEMPTIONS) DID NOT REJECT THE REQUEST OF THE ASSESSEE FOR APPROVAL U/S 80G OF THE ACT ON THE GROUND OF NOT ANNEXING THE REGISTRATION CERTIFICATE U/S 12AA OF T HE ACT BUT ON THE LIMITED GROUND THAT IT HAS NOT UNDERTAKEN MUCH ACTIVITY. AT THE IN CEPTION OF THE INSTITUTION, ONE CANNOT EXPECT SERIOUS ACTIVITIES, SINCE IT NEEDS FU NDS AND TO OBTAIN FUNDS, THE TRUST NEEDS APPROVAL U/S 80G OF THE ACT. THUS, THE ACTIVI TIES ARE INTERLINKED WITH OBTAINING APPROVAL. HENCE, MERE FACT THAT THE ASSESSEE COULD NOT UNDERTAKE MUCH ACTIVITY WITHIN THE SHORT SPAN OF 3 MONTHS, THE COMMISSIONER (EXEMPTIONS) SHOULD NOT HAVE REFUSED THE CLAIM OF APPROVAL U/S 80G(5) OF THE ACT . UNDER THE PECULIAR CIRCUMSTANCES, WE DIRECT THE LD. COMMISSIONER TO CO NSIDER THE ISSUE PRAGMATICALLY AND GRANT APPROVAL U/S 80G(5) OF THE ACT, IF ALL OT HER CONDITIONS ARE FULFILLED. 8 ITA NO. 1212/JP/2018 BADRI NARAIN KANTA DEVI KATTA CHARITABLE TRUST, JAI PUR. THUS IT WAS HELD THAT MERELY BECAUSE THE ASSESSEE C OULD NOT UNDERTAKE MUCH ACTIVITY WITHIN THE SHORT SPAN OF TIME, THE LD. CIT (E) SHOULD NOT HAVE REFUSED THE CLAIM OF APPROVAL UNDER SECTION 80G(5) OF THE ACT. THE COORDINATE BENCH OF THIS TRIBUNAL IN THE CASE OF KESHAR DEVI GODARA SAMAJIK KALYAN SANSTHAN SINGOR VS. CIT (EXEMPTIONS) (SUPRA) HAS ALSO CONSIDERED THE ISSUE OF DENIAL OF APPROVAL UNDER SECTION 80G(5) IN PARA 3.2 AS UNDER :- 3.2. WE HAVE HEARD RIVAL CONTENTIONS, PERUSED THE MATERIAL AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHOR ITIES BELOW. THERE IS NO DISPUTE WITH REGARD TO THE FACT THAT THE ASSE SSEE HAS BEEN GRANTED REGISTRATION UNDER SECTION 12AA OF THE ACT. THE COORDINATE BENCH IN THE CASE OF HEMDHA MEDI RESOURCES PVT. LTD . VS. CIT (EXEMPTIONS) IN ITA NO. 679/JP/2015 UNDER THE IDENT ICAL FACTS HAS OBSERVED AS UNDER :- 2.10. FURTHER, WE HAVE GONE THROUGH THE DECISION OF DECISION OF COORDINATE BENCH IN CASE OF PEARLS EDUCATIONAL INST ITUTE (SUPRA). THE SAID DECISION WAS RENDERED IN THE CONTEXT OF RE NEWAL OF APPROVAL UNDER SECTION 80G AND THE FACT THAT THE AP PELLANT IN THAT CASE HAD NOT COMMENCED CONSTRUCTION ACTIVITIES EVEN AFTER 13 YEARS WHICH IS DISTINGUISHABLE ON FACTS AS STATED A BOVE. IN OUR VIEW, THE SAID DECISION DOESNT SUPPORT THE CASE OF THE REVENUE. IN FACT, THE HONBLE ALLAHABAD HIGH COURT IN CASE O F HARDAYAL CHARITABLE AND EDUCATIONAL TRUST VS. CIT (SUPRA) IS DIRECTLY ON THE ISSUE AND SUPPORTS OUR VIEW. IN THAT CASE, ASSESSE E TRUST APPLIED FOR GRANT OF REGISTRATION U/S 12AA AND APPROVAL U/S 80G(5). THE CIT REFUSED TO GRANT REGISTRATION AND APPROVAL ON GRO UNDS THAT TRUST WAS IN PROCESS OF CONSTRUCTION OF COLLEGE FOR STUDI ES AND THAT HUGE AMOUNT WAS SPENT ON ADVERTISEMENT AND PROMOTION OF BUSINESS OF ITS FAMILY CONCERN. IN SUBSEQUENT ASSESSMENT YE AR, REGISTRATION U/S 12AA AND APPROVAL 80G WAS GRANTED WITH CONDIT IONS THAT 9 ITA NO. 1212/JP/2018 BADRI NARAIN KANTA DEVI KATTA CHARITABLE TRUST, JAI PUR. EXEMPTION CERTIFICATE WOULD BE EFFECTIVE FROM A.Y . 2012-13. IT WAS HELD THAT: FOR REGISTRATION U/S 12AA WHICH WAS NECESSARY FOR CLAIMING EXEMPTION U/S 11 AND 12, CIT WAS NOT REQUIRED TO L OOK INTO ACTIVITIES, WHERE SUCH ACTIVITIES HAD NOT OR WERE I N PROCESS OF ITS INITIATION. WHERE A TRUST SET UP TO ACHIEVE IT S OBJECTS OF ESTABLISHING EDUCATIONAL INSTITUTION, WAS IN PROCE SS OF ESTABLISHING SUCH INSTITUTIONS, AND RECEIVES DONATI ONS, REGISTRATION U/S 12AA CANNOT BE REFUSED ON GROUND THAT TRUST HAD NOT YET COMMENCED CHARITABLE OR RELIGIOUS ACTIVITY. ENQUIRY OF THE CIT AT SUCH PRELIMINARY S TAGE SHOULD BE RESTRICTED TO GENUINENESS OF OBJECTS AND NOT ACT IVITIES UNLESS SUCH ACTIVITIES HAD COMMENCED. 2.11 INTERESTINGLY, THE DECISION OF THE COORDINATE BENCH IN CASE OF HARDAYAL CHARITABLE AND EDUCATIONAL TRUST WHICH WAS OVERRULED BY THE ALLAHABAD HIGH COURT WAS QUOTED BY THE REVEN UE WHILE DENYING THE EXEMPTION INITIALLY TO THE APPELLANT UN DER SECTION 12AA. GIVEN THAT THE APPELLANT HAS SUBSEQUENTLY BE EN GRANTED APPROVAL UNDER SECTION 12AA AND THE SAID DECISION O F THE COORDINATE BENCH IS OVERRULED BY THE HIGH COURT SHO WS THAT THE APPELLANT IS WELL WITHIN ITS RIGHT TO SEEK APPROVAL UNDER SECTION 80G AS WELL. IN VIEW OF ABOVE, THE CIT(EXEMPTION) IS HEREBY DIRECTED TO GRANT APPROVAL U/S 80G(5) OF THE IT ACT , 1961 TO THE APPELLANT. THE FACTS ARE IDENTICAL IN THE PRESENT CASE. THEREF ORE, TAKING A CONSISTENT VIEW, THE LD. CIT (EXEMPTIONS) IS HEREBY DIRECTED TO GRANT APPROVAL U/S 80G(5)(VI) OF THE IT ACT, 1961 TO THE APPELLANT. ACCORDINGLY, IN THE FACTS AND CIRCUMSTANCES OF THE CASE, WHEN THERE IS NO ADVERSE FACT FOUND AGAINST THE ASSESSEE AND THE ASSESSEE HA S CLAIMED TO HAVE ALREADY STARTED THE ACTIVITY, THE MATTER IS REQUIRED TO BE CONSIDERED AFRESH BY THE LD. CIT (E) AFTER VERIFICATION OF THE ACTIVITIES CARRIED OUT BY THE ASSESSEE. HENCE THE MATTER IS 10 ITA NO. 1212/JP/2018 BADRI NARAIN KANTA DEVI KATTA CHARITABLE TRUST, JAI PUR. SET ASIDE TO THE RECORD OF THE LD. CIT (E) FOR PASS ING A FRESH ORDER IN THE LIGHT OF THE ABOVE OBSERVATION. NEEDLESS TO SAY THAT THE ASSESSE E BE GIVEN AN OPPORTUNITY OF HEARING BEFORE PASSING THE FRESH ORDER. 6. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER IS PRONOUNCED IN THE OPEN COURT ON 30/07/2 019. SD/- SD/- ( JES'K LH- 'KEKZ ) ( FOT; IKY JKWO (RAMESH C. SHARMA ) (VIJAY PAL RAO) YS[KK LNL;@ ACCOUNTANT MEMBER U;KF;D LNL;@ JUDICIAL MEMBER JAIPUR DATED:- 30/07/2019. DAS/ VKNS'K DH IZFRFYFI VXZSF'KR@ COPY OF THE ORDER FORWARDED TO: 1. THE APPELLANT- BADRI NARAIN KANTA DEVI KATTA CHA RITABLE TRUST, JAIPUR. 2. THE RESPONDENT THE CIT (EXEMPTIONS), JAIPUR. 3. THE CIT(A). 4. THE CIT, 5. THE DR, ITAT, JAIPUR 6. GUARD FILE (ITA NO. 1212/JP/2018) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASSISTANT. REGISTRAR