The Rai University, Ahmedabad V. The DIT(Exemp.), Ahmedabad

ITA 1246/AHD/2014

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 89501 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 1 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-06-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 05-05-2015
• Assessment Year: misc
• Appeal Filed On: 28-04-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VIMALENDU VERMA
• Keywords: Charitable institution
• Section: 80G; 12A; 12AA; 10B; 6; 12; 10; 2; 11; 15

Judgement Text

, , , , IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, AHMEDABAD BEFORE SHRI ANIL CHATURVEDI, ACCOUNTANT MEMBER AND SHRI KUL BHARAT, JUDICIAL MEMBER ./ ././ ./ ITA NO. 1246/AHD/2014 THE RAI UNIVERSITY, SARODA POST, DHOLKA, AHMEDABAD PAN : AABAR 4376 A VS DIRECTOR OF INCOME TAX (EXEMPTION), AHMEDABAD / // / (APPELLANT) / // / (RESPONDENT) ASSESSEE(S) BY : SMT. ARTI N. SHAH, AR REVENUE BY : SHRI VIMALENDU VERMA, CIT-DR !'# $ %&/ // / DATE OF HEARING : 08/05/2015 '() $ %& / // / DATE OF PRONOUNCEMENT: 10/06/2015 *+ *+ *+ *+/ // / O R D E R PER SHRI KUL BHARAT, JUDICIAL MEMBER:- THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E ORDER OF THE DIRECTOR OF INCOME TAX (EXEMPTION), AHMEDABAD DATED 03.04.2014 REJECTING THE APPLICATION FILED BY THE ASSESSEE U/S 12A OF TH E INCOME-TAX ACT. 2. IN THIS APPEAL BY THE ASSESSEE, FOLLOWING GROUND S WERE RAISED:- 1. THE LEARNED DIRECTOR OF INCOME TAX (EXEMPTION), AHMEDABAD HAS ERRED IN PASSING ORDER GIVING EFFECT TO THE ORDER OF I.T. A.T. IN ITA NO.815/AHD/2013 THOUGH THE MISCELLANEOUS APPLICATIO N NO. 15/AND/2014 AGAINST THE SAID ORDER FILED BY THE APPELLANT WAS K EPT PENDING BY THE HON'BLE I.T.A.T. FOR DISPOSAL. 2. THE LEARNED DIRECTOR OF INCOME TAX (EXEMPTION), AHMEDABAD HAS ERRED IN REJECTING THE APPLICATION FOR REGISTRATION U/S.!2A HOLDING THAT THE APPELLANT DOES NOT HAVE ANY TRUST DEED OR MEMORANDUM OF ASSOC IATION OR ARTICLE OF ASSOCIATION THOUGH THE SAME IS CONSTITUTED AND GOVE RNED BY THE PROVISIONS OF GUJARAT PRIVATE UNIVERSITIES ACT AND IS A BODY CORP ORATE IN ACCORDANCE WITH THE SAME. ITA NO. 1246/AHD/2014 RAI UNIVERSITY VS. DIT (EXEMP) U/S 12A 2 3. THE LEARNED DIRECTOR OF INCOME TAX (EXEMPTION), AHMEDABAD HAS ERRED IN NOT FOLLOWING THE DECISION OF THE SUPREME COURT IN THE CASE OF CIT VS. GUJARAT MARITIME BOARD - 295 ITR 561 GRANTING EXEMP TION U/S.12A THOUGH THE SAME WAS NOT CONSTITUTED UNDER SEPARATE TRUST D EED OR MEMORANDUM OF ASSOCIATION OR ARTICLE OF ASSOCIATION BUT THE SAME WAS FORMED UNDER GUJARAT MARITIME BOARD ACT. 4. THE LEARNED DIRECTOR OF INCOME TAX (EXEMPTION), AHMEDABAD HAS ERRED IN HOLDING THAT THERE WAS NO CLAUSE IN THE FIRST STATU TE THAT THE UNIVERSITY WILL NOT BE DISSOLVED AND IF AT ALL IT HAS TO BE DISSOLV ED, ITS ASSETS WILL GO TO ANOTHER TRUST CARRYING ON SIMILAR ACTIVITIES OF UNI VERSITY EDUCATION THOUGH THE PROVISIONS OF WINDING UP OF THE UNIVERSITY HAVE BEEN DULY INCORPORATED IN SECTION 41 OF CHAPTER IX OF GUJARAT PRIVATE UNIV ERSITIES ACT. 5. THE LEARNED DIRECTOR OF INCOME TAX (EXEMPTION), AHMEDABAD HAS ERRED IN HOLDING THAT THE ASSET OF THE APPELLANT ON DISSOLUT ION SHALL GO TO SPONSORING BODY, WHICH CANNOT BE PERMITTED IN RESPECT OF ANY C HARITABLE INSTITUTION INSPITE OF THE FACT THAT SPONSORING BODY IS ITSELF A PUBLIC CHARITABLE TRUST DULY REGISTERED U/S.12A OF THE ACT. 6. THE LEARNED DIRECTOR OF INCOME TAX (EXEMPTION), AHMEDABAD HAS ERRED IN NOT CONSIDERING THE DEFINITION OF SPONSORING BODY C ONTAINED IN SECTION 2(T) OF THE GUJARAT UNIVERSITIES ACT WHICH REQUIRES THE SPO NSORING BODY TO BE THE SOCIETY REGISTERED SOCIETIES REGISTRATION ACT OR PU BLIC TRUST OR COMPANY REGISTERED U/S.25 OF THE COMPANIES ACT, 1956. 7. THE LEARNED DIRECTOR OF INCOME TAX (EXEMPTION), AHMEDABAD HAS ERRED IN HOLDING THAT THE APPELLANT WAS NOT A CHARITABLE INS TITUTION AND WAS FOR PROFIT MAKING THOUGH THE STATUTE NO.21 RESTRICTS TH E ADMISSIONS OF STUDENTS HAVE TO BE BASED ON MERITS OR MEANS AND THE STRUCTU RE AND FEES HAS TO BE AS PER EXISTING PROVISIONS OF THE STATE GOVERNMENT AND MEANS HAVE TO BE DETERMINED BASED ON ECONOMIC CONDITION OR SITUATION OF THE STUDENTS WHICH AMPLY PROVES THAT IT CARRIES OUT THE OBJECT OF EDUC ATION AND IT IS NOT FOR PROFIT MAKING. 8. THE LEARNED DIRECTOR OF INCOME TAX (EXEMPTION), AHMEDABAD HAS ERRED IN HOLDING THAT THE APPELLANT WAS NOT AN INDIVIDUAL BO DY BUT ALMOST ABSOLUTELY CONTROLLED BY THE SPONSORING BODY THOUGH EVEN SPONS ORING BODY IS ALSO A CHARITABLE INSTITUTION REGISTERED U/S.12A OF THE AC T, AND THERE CANNOT BE ANY QUESTION OF BEING GOVERNED BY PRIVATE INDIVIDUALS. ITA NO. 1246/AHD/2014 RAI UNIVERSITY VS. DIT (EXEMP) U/S 12A 3 9. THE LEARNED DIRECTOR OF INCOME TAX (EXEMPTION), AHMEDABAD HAS FINALLY ERRED IN HOLDING THAT ACTIVITIES AND OBJECTS OF THE APPELLANT ARE NOT GENUINELY CHARITABLE. 10. YOUR APPELLANT RESERVES THE RIGHT TO ADD, ALTER , AMEND AND/OR WITHDRAW ANY OF THE ABOVE GROUNDS OF APPEAL. 3. BRIEFLY STATED FACTS ARE THAT THIS IS THE SECOND ROUND OF LITIGATION. IN THE EARLIER ROUND, THE ASSESSEE HAD CHALLENGED THE REJECTION OF APPLICATION FOR REGISTRATION OF THE ASSESSEE-TRUST U/S 12AA BY THE DIT (EXEMPTIONS) BEFORE THE TRIBUNAL. THE TRIBUNAL WAS PLEASED TO RESTORE B ACK THE APPLICATION OF THE ASSESSEE FOR FRESH CONSIDERATION BY ITS ORDER DATED 19.12.2013 VIDE ITA NO.815/AHD/2013. THE LD. DIT(EXEMPTIONS) VIDE IMPU GNED ORDER DATED 03.04.2014 ONCE AGAIN REJECTED THE APPLICATION OF T HE ASSESSEE. THE ASSESSEE, THEREFORE, BEING AGGRIEVED BY THE AFORESAID ORDER O F THE DIT(EXEMPTIONS) HAS PREFERRED THE PRESENT APPEAL. 4. BOTH THE REPRESENTATIVES OF THE RESPECTIVE PARTI ES HAVE MADE ORAL ARGUMENTS AS WELL AS WRITTEN SUBMISSIONS. 5. WE HAVE HEARD THE RIVAL SUBMISSIONS, PERUSED THE MATERIAL AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHOR ITIES BELOW. THE ASSESSEE HAS FILED WRITTEN SUBMISSIONS DATED 08.05. 2014 AND 12.05.2014, WHICH READ AS UNDER:- WRITTEN SUBMISSIONS FACTS OF THE CASE: 1. RAI FOUNDATION HAD SUBMITTED A PROPOSAL FOR SETT ING UP A UNIVERSITY IN THE NAME OF RAI UNIVERSITY IN THE STATE OF GUJARAT. THE SAID PROPOSAL TO SET UP THIS UNIVERSITY WAS SUBMITTED BY RAI FOUNDATION TO THE HON. CHIEF MINISTER OF GUJARAT, SHRI NARENDRA MODI AND THE SPO NSORING BODY HAD SHOWED THEIR WILLINGNESS TO INVEST AROUND 50 CRORES IN 3 YEARS FOR THE SAME (PAPER BOOK PAGE NO 129 TO 371). THE GOVT OF G UJARAT HAD THEREAFTER EXECUTED AN MOU ON 13-01-2009 AND THE PR INCIPAL SECRETARY , EDUCATION DEPARTMENT, GOVT OF GUJARAT HAD VIDE LETT ER DATED 19-09-2011 ITA NO. 1246/AHD/2014 RAI UNIVERSITY VS. DIT (EXEMP) U/S 12A 4 ALLOTTED LAND TO THE APPELLANT (PAPER BOOK PAGE NO 372 & 373). THEREAFTER THE EDUCATION DEPARTMENT VIDE LETTER DAT ED 22-02-2012 GAVE A LETTER OF INTENT FOR SETTING UP OF THE UNIVERSITY U NDER THE GUJARAT PRIVATE UNIVERSITY ACT RULES AND REGULATIONS (PAPER BOOK PA GE NO 375 TO 377). ON COMPLETION OF THE FORMALITIES RELATING TO SETTIN G UP OF THE UNIVERSITY, THE GUJARAT GOVERNMENT GAZETTE AMENDED THE GUJARAT PRIVATE UNIVERSITY ACT, 2009 ON 11-04-2012 TO INCLUDE THE NAME OF APPE LLANT - RAI UNIVERSITY AT SR NO 10 (PPAER BOOK PAGE NO 10) AND CONFIRMED THE ESTABLISHMENT OF THE SAID UNIVERSITY IN GUJARAT TO OPERATE AS PER THE PROVISIONS OF THE GUJARAT PRIVATE UNIVERSITY ACT, 2 009 (PAPER BOOK PAGE NO 8 & 9 ). 2. THE APPELLANT WAS THUS TO BE SETUP AS A UNIVERSI TY- RAI UNIVERSITY AT SANAND, AHMEDABAD UNDER THE GUJARAT PRIVATE UNIVERS ITY ACT. IT WAS TO BE AN INDEPENDENT ORGANIZATION ESTABLISHED AND OPER ATING AS PER THE PROVISIONS CONTAINED IN THE GUJARAT PRIVATE UNIVERS ITY ACT. 3. THE APPELLANT HAD THEN FILED AN APPLICATION FOR REGISTRATION U/S 12 A AND EXEMPTION U/S 80G OF THE INCOME TAX ACT, 1961 ALONG WITH THE NECESSARY ENCLOSURES TO THE DIRECTOR OF INCOME TAX (EXEMPTI ON) ON 16-08-2012 (PAPER BOOK PAGE 1 TO 41). 4. THEREAFTER, IN RESPONSE TO THE QUERIES RAISED BY THE LEARNED DIT, THE APPELLANT HAD GIVEN RESPONSES VIDE LETTERS DATED 05 -11-2012, 26-11-2012 AND 18-02-2013 (PAPER BOOK PAGE NO 42 TO 71). HOWEV ER, THE SAID APPLICATION WAS REJECTED BY THE HON. DIT(E) VIDE HI S ORDER DATED 26-02- 2013 STATING THAT IN ABSENCE OF ANY DEED/MEMORANDUM OF ARTICLE/ MEMORANDUM OF ASSOCIATION, THE APPLICATION IS REJEC TED. 5. THEREAFTER AN APPEAL WAS BEFORE THE HON TRIBUNAL WHEREIN A WRITTEN SUBMISSION WAS FILED ON 18-09-2013 (PAPER BOOK PAGE NO 99 TO 103). IT WAS POINTED OUT IN THE SAID SUBMISSION THAT A UNIVE RSITY IN THE NAME OF THE AHMEDABAD UNIVERSITY HAS BEEN ESTABLISHED IN GU JARAT UNDER THE GUJARAT PRIVATE UNIVERSITY ACT AND THE DETAILS OF T HE SAME WERE PRODUCED AT PAPER BOOK PAGE NO 105 TO 111. IN THE SAID CASE THE UNIVERSITY HAS BEEN GRANTED REGISTRATION U/S 12A ON 30-03-2010 AND HAS ALSO BEEN APPROVED U/S 10(23C) OF THE INCOME TAX ACT 1961. TH E FACTS OF THE SAID UNIVERSITY ARE EXACTLY THE SAME AS THE APPELLANT. 6. FURTHER, DURING THE COURSE OF HEARING A SIMILAR UNIVERSITY -OP JINDAL UNIVERSITY CASE LAW (38 TAXMANN.COM 366 ) (P & H) ( JUDGEMENT PAPER BOOK PAGE NO 1 TO 4 ) WAS ALSO CITED WHICH WAS ESTA BLISHED ON SIMILAR LINES IN THE STATE OF HARYANA. THE HARYANA PRIVATE UNIVERSITY ACT WAS ALSO PRODUCED BEFORE THE HON. BENCH IN ORDER TO SHO W THE SIMILARITY WITH THE GUJARAT PRIVATE UNIVERSITY ACT. (PAPER BOOK PAG E NO 379 TO 390). ITA NO. 1246/AHD/2014 RAI UNIVERSITY VS. DIT (EXEMP) U/S 12A 5 7. HOWEVER, THE HON. TRIBUNAL VIDE ORDER DATED 19-1 2-2013 SET ASIDE THE CASE TO HON. DIT(E) WITH INSTRUCTIONS ' TO CONSIDER THE DOCUMENTS AS FILED BY THE ASSESSEE I.E. DEED OF TRUST AND DECIDE THIS ISS UE IN LIGHT OF VARIOUS CASE LAWS CITED BY THE ASSESSEE.' 8. SINCE THERE WAS NO TRUST DEED BY WHICH THE APPEL LANT WAS SET UP AND THE SAID FACT WAS MENTIONED DURING THE HEARING TO THE H ON. BENCH, THE APPELLANT FILED A MISCELLANEOUS APPLICATION AGAINST THE SAID ORDER OF THE HON. TRIBUNAL. THE SAID MA HAS BEEN HEARD ON 17-04- 2015 AND THE ORDER IS AWAITED. 9. MEANTIME, IN RESPONSE TO THE LETTER FILED BY THE DEPARTMENT REPRESENTATIVE TO THE DIT(E) FOR EXPEDIATING THE SE T ASIDE MATTER, THE APPELLANT FILED SUBMISSIONS DATED 21-03-2014, 25-03 -2014, AND 01-04- 2014 (PAPER BOOK PAGE NO 391 TO 423) TO THE HON. DI T IN RESPONSE TO THE QUERIES RAISED BY HIM. HOWEVER, THE HON.DIT PASSED ORDER DATED 03-04- 2014 AND ONCE AGAIN REJECTED THE APPLICATION OF THE APPELLANT ON VARIOUS OTHER GROUNDS. ARGUMENTS: 1. IT IS SUBMITTED THAT IN LIGHT OF ABOVE MENTIONE D FACTS, THE APPELLANT IS A UNIVERSITY ESTABLISHED UNDER THE GUJARAT PRIVATE UN IVERSITY ACT AND RAI FOUNDATION IS ITS SPONSORING BODY. THE SPONSORING B ODY IS A TRUST CREATED ON 31-07-1996 AND HAS BEEN GRANTED REGISTRATION U/S 12A ON 10-02-1997. THE APPELLANT IS GOVERNED BY THE PROVISIONS OF THE GUJARAT PRIVATE UNIVERSITY ACT, 2009 WHICH MENTIONS THE RULES REGAR DING SETTING UP OF A UNIVERSITY, APPLICATION PROCESS THEREOF, OFFICERS O F THE UNIVERSITY NAMELY REGISTRAR, CFO & OTHER OFFICERS, AUTHORITIES OF THE UNIVERSITY I.E GOVERNING BODY, BOARD OF MANAGEMENT, ETC, STATUTES, ORDINANCES AND REGULATIONS, REGULATION OF UNIVERSITY, FUNDS OF UNI VERSITY, ACCOUNTS AUDIT & ANNUAL REPORT, WIN DING UP AND MISCELLANEOU S PROVISIONS. ON INCLUSION OF THE APPELLANT'S NAME IN THE GUJARAT GO VERNMENT GAZETTE ON 11-04-2012, THE APPELLANT IS SAID TO HAVE BEEN SET UP ON THAT DATE AND IS GOVERNED BY THE PROVISIONS OF THE GUJARAT PRIVATE U NIVERSITY ACT. 2. IT IS FURTHER SUBMITTED THAT AS PER THE PROVISIO NS OF RULE 17A OF THE INCOME TAX RULES 1962, THE APPLICATION FOR REGISTRATION U/ S.12A SHOULD BE SUBMITTED IN FORM NO.10A ALONG WITH COPY OF INSTRUM ENT CREATING THE TRUST. HOWEVER, IT ALSO STATES THAT IF IT IS ESTABL ISHED OTHERWISE THAN UNDER THE INSTRUMENT, THE DOCUMENT EVIDENCING THE CREATIO N OF TRUST OR ESTABLISHMENT OF THE INSTITUTION SHOULD BE SUBMITTE D. IN THE PRESENT CASE, THE INSTITUTION VIZ. RAI UNIVERSITY IS ESTABLISHED BY THE PROVISIONS OF GUJARAT PRIVATE UNIVERSITIES ACT, 2009 AND THEREFOR E, THERE CANNOT BE ANY ITA NO. 1246/AHD/2014 RAI UNIVERSITY VS. DIT (EXEMP) U/S 12A 6 SEPARATE INSTRUMENT FOR THE CREATION OF RAI UNIVERS ITY BUT NONE THE LESS THE SAME COMPLIES WITH THE PROVISIONS OF RULE 17A. 3. IN SUPPORT OF THE ABOVE CONTENTIONS, WE WOULD LI KE TO PLACE RELIANCE ON THE FOLLOWING DECISIONS:- (I) CIT VS O P JINDAL GLOBAL UNIVERSITY (38 TAXMANN .COM 366 ) (P & H) WHICH WAS CONSTITUTED BY THE HARYANA PRIVATE UNIVERSITY ACT. (II) CIT VS. ANDHRA PRADESH STATE ROAD TRANSPORT CO RPORATION - 159 ITR 1 (SC), WHICH WAS CONSTITUTED BY ROAD TRANSPORT COR PORATION ACT, 1950 BY THE STATE OF ANDHRA PRADESH. (III)CIT VS. GUJARAT MARITIME BOARD - 295 ITR 561 ( SC), WHICH WAS CONSTITUTED UNDER GUJARAT MARITIME BOARD ACT. (IV)UP. FOREST CORPORATION VS. DCIT - 297 ITR 1 (SC), WHEREIN IT WAS ESTABLISHED UNDER UP, FOREST CORPORATION ACT, 1 974. REGISTRATION U/S.12A HAS BEEN GRANTED IN ALL THE AB OVE CASES ON THE BASIS OF PROVISIONS OF RELEVANT ACT THOUGH THERE WAS NO S EPARATE TRUST DEED OR REGISTRATION UNDER TRUST ACT. 4. WE WOULD FURTHER LIKE TO POINT OUT THE DECISION OF M.P. HIGH COURT IN THE CASE OF LAXMINARAYAN MAHARAJ VS. CIT - 150 ITR 465, WHEREIN IT WAS HELD THAT WHERE THE TRUST IS NOT CREATED UNDER INST RUMENT, IT IS IMPOSSIBLE TO PRODUCE CONSTITUTIONAL DOCUMENT, AND HENCE, THE RULE REQUIRES THE PRODUCTION OF EVIDENTIARY DOCUMENTS I. E. THE DOCUMENTS EVIDENCING THE CREATION OF TRUST. IN THE PRESENT CA SE, GUJARAT PRIVATE UNIVERSITIES ACT, 2009 CONTAINS PROVISIONS REGARDIN G RUNNING OF INSTITUTION BY WHICH RULE 17A IS COMPLIED WITH. IN VIEW OF THE ABOVE, WE REQUEST THE HON'BLE MEMBER S OF THE BENCH TO KINDLY CONSIDER THE ABOVE AND GRANT REGISTRATION U/S.12AA OF THE IT. ACT, 1961 TO THE APPELLANT. DATE: 08.05.2014 SD/- PLACE: AHMEDABAD. APPELLANT WRITTEN SUBMISSIONS IN SUPPORT OF OUR WRITTEN SUBMISSIONS DATED 07-05-2 015 AND THE ORAL ARGUMENTS PUT FORWARD DURING THE HEARING DATED 07-0 5-2015, WE WOULD LIKE TO PUT ON RECORD THE FOLLOWING ARGUMENTS: ITA NO. 1246/AHD/2014 RAI UNIVERSITY VS. DIT (EXEMP) U/S 12A 7 1. ANY TRUST WHO WANTS TO AVAIL OF EXEMPTION U/S 11 & 12 OF THE INCOME TAX ACT HAS TO SATISFY THE CONDITIONS MENTIONED IN SECT ION 12A OF THE INCOME TAX ACT WHICH STATES THAT: '(1) THE PROVISIONS OF SECTION 11 AND 12 SHALL NOT APPLY IN RELATION TO INCOME OF ANY TRUST OR INSTITUTION UNLESS THE FOLLO WING CONDITIONS ARE FULFILLED, NAMELY :- (A)THE PERSON IN RECEIPT OF THE INCOME HAS MADE AN APPLICATION FOR REGISTRATION OF THE TRUST OR INSTITUTION IN THE PRE SCRIBED FORM AND IN THE PRESCRIBED MANNER TO THE [PRINCIPAL COMMISSIONER OR ] COMMISSIONER BEFORE THE 1ST DAY OF JULY, 1973, OR BEFORE THE EXPIRY OF A PERIOD OF ONE YEAR FROM THE DATE OF THE CREATION OF THE TRUST OR THE ESTABL ISHMENT OF THE INSTITUTION, [WHICHEVER IS LATER AND SUCH TRUST OR INSTITUTION I S REGISTERED UNDER SECTION 12AA]:' 2. FURTHER AS PER THE AFORESAID PROVISIONS, RULE 17 A OF THE INCOME TAX RULES 1962, SHALL BE APPLICABLE AND THE APPLICATION FOR R EGISTRATION U/S.12A SHOULD BE SUBMITTED IN FORM NO.10A ALONG WITH COPY OF INSTRUMENT CREATING THE TRUST. HOWEVER, IT ALSO STATES THAT IF IT IS ESTABLISHED OTHERWISE THAN UNDER THE INSTRUMENT, THE DOCUMENT EVIDENCING THE CREATION OF TRUST OR ESTABLISHMENT OF THE INSTITUTION SHOULD BE SUBMI TTED. IN THE PRESENT CASE, THE INSTITUTION VIZ. RAI UNIVERSITY IS ESTABL ISHED BY THE PROVISIONS OF GUJARAT PRIVATE UNIVERSITIES ACT, 2009 AND THEREFOR E, THERE CANNOT BE ANY SEPARATE INSTRUMENT FOR THE CREATION OF RAI UNIVERS ITY BUT NONE THE LESS THE SAME COMPLIES WITH THE PROVISIONS OF RULE 17A. 3.THUS AS PER THE ABOVE, ANY TRUST/INSTITUTION WHO WANTS TO AVAIL EXEMPTION U/S 11 & 12 HAS TO APPROACH THE COMMISSIONER U/S 12 AA AND THE PROCEDURE FOR OBTAINING REGISTRATION IS THEN STATED IN SECTION 12AA OF THE INCOME TAX ACT WHEREIN IT HAS BEEN MENTIONED THAT: 'THE [PRINCIPAL COMMISSIONER OR] COMMISSIONER, ON R ECEIPT OF AN APPLICATION FOR REGISTRATION OF A TRUST OR INSTITUT ION MADE UNDER CLAUSE (A) [OR CLAUSE (AA) OF SUB-SECTION (1)] OF SECTION 12A, SHALL - (A) CALL FOR SUCH DOCUMENTS OR INFORMATION FROM THE TRUST OR INSTITUTION AS HE THINKS NECESSARY IN ORDER TO SATI SFY HIMSELF ABOUT THE GENUINENESS OF ACTIVITIES OF THE TRUST OR INSTITUTI ON AND MAY ALSO MAKE SUCH INQUIRES AS HE MAY DEEM NECESSARY IN THIS BEHA LF; AND (B) AFTER SATISFYING HIMSELF ABOUT THE OBJECTS OF T HE TRUST OR INSTITUTION AND THE GENUINENESS OF ITS ACTIVITIES, HE - (I) SHALL PASS AN ORDER IN WRITING REGISTERING THE TRUST OR INSTITUTION; ITA NO. 1246/AHD/2014 RAI UNIVERSITY VS. DIT (EXEMP) U/S 12A 8 (II) SHALL, IF HE IS NOT SO SATISFIED, PASS AN ORDE R IN WRITING REFUSING TO REGISTER THE TRUST OR INSTITUTION, AND A COPY OF SUCH ORDER SHALL BE SENT TO THE APPLICANT:' 4. HENCE, AS PER THE ABOVE PROVISIONS OF THE INCOM E TAX ACT, IT IS CLEAR THAT THE TRUST/INSTITUTION HAS TO MAKE AN APPLICATION -T HE APPLICATION HAS TO BE MADE IN FORM 10B - THE SAME HAS TO BE VETTED AS PER THE PRUDENCE OF THE HON. CIT AS TO WHETHER THE ACTIVITIES OF THE TRUST ARE GENUINE OR NOT. 5. THE APPELLANT - RAI UNIVERSITY IS THUS QUALIFIED TO GET THE REGISTRATION ON THE FOLLOWING GROUNDS: (1) IT IS A UNIVERSITY ESTABLISHED UNDER THE GUJARA T PRIVATE UNIVERSITY ACT AND IS A INSTITUTION BY ITSELF. (2) IT HAS A SPONSORING BODY NAMELY RAI FOUNDATION WHICH IS REGISTERED TRUST HAVING 12A REGISTRATION. (3) RAI UNIVERSITY HAS MADE AN APPLICATION FOR REGI STRATION WITHIN THE TIME LIMIT AND IN THE PRESCRIBED FORM 10B AS PER SE CTION 12A OF THE INCOME TAX ACT READ WITH RULE17A. (4) THE GUJARAT PRIVATE UNIVERSITY ACT GOVERNING TH E UNIVERSITY HAS ALL THE NECESSARY CLAUSES REQUIRED FOR THE FUNCTIONING OF A CHARITABLE INSTITUTION AND SEVERAL OTHER UNIVERSITIES ARE ALSO ESTABLISHED IN THE STATE OF GUJARAT ON SIMILAR GROUNDS WHICH HAVE BEEN GRANTED REGISTRATION U/S 12AA. A COPY OF ONE SUCH UNIVERSIT Y NAMELY AHMEDABAD UNIVERSITY HAS BEEN PLACED ON RECORD DURI NG THE HEARING. (5) RAI UNIVERSITY IS AT PRESENT FUNCTIONING ON FUL L FLEDGE BASIS AND THE ACTIVITY CAN BE WITNESSED FROM ITS WEBSITE WYW.RAJU NIVERSITY.EDU THE SPONSORING BODY HAS ALREADY PLACED A DEPOSIT OF RS 5 CRORES AS SECURITY WITH THE GOVERNMENT OF GUJARAT AS PER THE TERMS OF SETTING UP OF THE UNIVERSITY. APART FROM THAT IT IS ALSO FUNDING THE UNIVERSITY EXPENSES IN THE INITIAL YEARS OF OPERATION. 6. OUR CONTENTION IS FURTHER SUPPORTED BY THE FOLLO WING JUDGEMENTS (COPY ENCLOSED): (1) DIRECTOR OF INCOME TAX VS GARDEN CITY EDUCATIONAL T RUST (330 ITR 480)(KARN)(HC): WHEREIN IT HAS BEEN HELD THAT MANNE R OF APPLICATION OF FUNDS AND AS TO WHETHER ASSESSES CAN CLAIM BENEF IT OF EXEMPTION IN TERMS OF SECTION 11 AND 12 ARE QUESTIONS WHICH HAVE TO BE EXAMINED BY ASSESSING OFFICER AT STAGE WHEN IT IS URGED AND NOT BY COMMISSIONER WHILE CONSIDERING APPLICATION FOR REGISTRATION U/S 12A. ITA NO. 1246/AHD/2014 RAI UNIVERSITY VS. DIT (EXEMP) U/S 12A 9 (2) HARDAYAL CHARITABLE & EDUCATIONAL TRUST VS CIT (355 ITR 534 (AII)(HC): WHEREIN IT IS HELD THAT ENQUIRY OF COMMI SSIONER AT SUCH PRELIMINARY STAGE SHOULD BE RESTRICTED TO GENUINENE SS OF OBJECTS AND NOT ACTIVITIES, UNLESS SUCH ACTIVITIES HAVE COMMENC ED. (3) SWARGIYA JAGANNATH JATTESHWAR SHIKSHAN SANSTHA VS C IT : (31 TAXMANN.COM 321)(NAG)(TRIB): WHEREIN IT IS HELD WHI LE GRANTING REGISTRATION TO A CHARITABLE TRUST, COMMISSIONER HA S TO EXAMINE GENUINENESS OF OBJECTS AND ACTIVITIES OF THE TRUST AND APPLICATION OF INCOME FOR CHARITABLE PURPOSES WHICH CAN BE EXAMINE D AT A STAGE WHEN THE TRUST FILES ITS RETURN. (4) DIRECTOR OF INCOME TAX VS FOUNDATION OF OPTHALM IC & OPTOMETRY RESEARCH EDUCATION CENTRE (25 TAXMANN.COM 376 )(DEL )(HC) : WHEREIN IT IS HELD THAT WHILE EXAMINING APPLICATION U/S 12AA CONCERNED COMMISSIONER IS NOT REQUIRED TO EXAMINE Q UESTION WHETHER TRUST HAS ACTUALLY COMMENCED AND CARRIED OUT CHARIT ABLE ACTIVITIES. ALL THE ABOVE JUDGEMENTS SUPPORT OUR CONTENTION THA T WHILE GRANTING REGISTRATION U/S 12AATHE HON. DIT HAS TO LOOK INTO THE GENUINENESS OF THE ACTIVITY OF THE TRUST WHICH IN CASE OF THE APPELLAN T CAN BE SEEN DIRECTLY FROM THE PRESENT ACTIVITIES CARRIED ON BY THE UNIVERSITY . IN VIEW OF THE ABOVE, WE REQUEST THE HON'BLE MEMBER S OF THE BENCH TO KINDLY CONSIDER THE ABOVE AND GRANT REGISTRATION U/S.12AA OF THE I.T. ACT, 1961 TO THE APPELLANT. DATE: 12.05.2014 SD/ PLACE: AHMEDABAD. APPELLANT 6. THE REVENUE HAS ALSO FILED WRITTEN SUBMISSIONS W HICH REPRODUCED AS UNDER: SUBJECT: WRITTEN SUBMISSION ON IMPORTANCE OF DISSO LUTION CLAUSE HON'BLE MEMBERS, DURING THE COURSE OF HEARING THE ESTEEM MEMBERS HAV E DESIRED TO PLACE ON RECORD ANY JUDGEMENT TO UNDERSCORE THE IMPORTANCE O F DISSOLUTION CLAUSE. DISSOLUTION CLAUSE IS VERY IMPORTANT SO THAT UPON D ISSOLUTION THE ASSETS AND FUNDS ARE NOT USURPED BY THE TRUSTEES DONORS ETC. I N A PUBLIC CHARITABLE OR ITA NO. 1246/AHD/2014 RAI UNIVERSITY VS. DIT (EXEMP) U/S 12A 10 RELIGIOUS TRUSTS THE MONEY BELONGS TO THE PUBLIC AN D TRUSTEES HOLD THE SAME IN TRUST FOR USE AS PER THE OBJECTS OF THE TRUST. IN C ASE OF DISSOLUTION THESE MUST GO TO A TRUST CARRYING ON SIMILAR ACTIVITIES AS THE PUBLIC GAVE FUNDS AND GOVT FORGAVE REVENUE FOR CARRYING ON THE ACTIVITIES AS P ER THE OBJECTS OF THE TRUST. THE CAS ARGUE THAT UNDER BOMBAY OR GUJARAT PUBLIC T RUST ACT DISSOLUTION OF TRUST IS NOT POSSIBLE. THEN THE ARGUMENT IS THAT TR USTEES FUNCTION AS PER THE TRUST DEED AND MOSTLY ILL EQUIPPED TO READ OR EVEN THINK OF THE ACT LASTLY IT HAS BEEN NOTICED THAT TRUSTS HAVE AMALGAMATION CLAU SE IN THE DEED WHICH SHOWS THAT DESPITE THE BOMBAY PUBLIC TRUST ACT TRUS TEES DO DISSOLVE AND MERGE TRUSTS IN ANY OTHER TRUSTS NOT HAVING SIMILAR OBJECTS DEED SHOULD HAVE A NO-PROFIT CLAUSE AND DISSOLUTION CLAUSE- FOLLOWING JUDGEMENT ARE QUOTED TO SUPPORT THE IMPORTANCE OF D ISSOLUTION CLAUSE MOHANLAL KANJIBHAI PANSARA EDUCATION & CHARITABLE T RUST - [2013] 36 TAXMANN.COM 338 (RAJKOT - TFIB.)/[2013] 59 SOT 169 (RAJKOT -TRIB.) - SECTION 12AA, OF THE INCOME-TAX ACT, 1961 - CHARITA BLE OR RELIGIOUS TRUST - REGISTRATION PROCEDURE [SCOPE OF PROVISION] - ASSES SEE-TRUST APPLIED FOR REGISTRATION UNDER SECTION 12AA - A PERUSAL OF TRUS T DEED SUBMITTED BY ASSESSEE SHOWED THAT ACTIVITIES PROPOSED TO BE CARR IED OUT WERE NOT CHARITABLE IN NATURE - NEITHER THERE WAS ANY CLAUSE IN TRUST D EED IMPOSING LEGAL OBLIGATION ON ASSESSEE TO HOLD INCOME FOR CHARITABL E PURPOSES NOR ELEMENT OF PRIVATE GAIN EXCLUDED - MOREOVER, THERE WAS NO PROV ISION IN TRUST DEED TO ENSURE THAT PROPERTIES OF TRUST UPON DISSOLUTION WO ULD BE TRANSFERRED TO ANOTHER TRUST HAVING SIMILAR OBJECT - WHETHER IN VI EW OF ABOVE, ASSESSEE-TRUST COULD NOT BE TREATED AS A CHARITABLE TRUST ENTITLED FOR REGISTRATION UNDER SECTION 12AA - HELD, YES [PARA 11] [IN FAVOUR OF RE VENUE] IT : WHERE ACTIVITIES CARRIED OUT BY ASSESSEE-TRUST WERE NOT F OUND TO BE CHARITABLE, ASSESSEE-TRUST COULD NOT BE SAID TO BE CHARITABLE T RUST ENTITLED FOR REGISTRATION UNDER SECTION 12AA 2. THE SUPREME COURT NOTED THE DISSOLUTION CLAUSE IN THE CASE OF SURAT ART SILK CLOTH MANUFACTURERS ASSOCIATION 121ITR 1 IN PA RA 2 AS 'THE AMENDED OBJECTS, SO FAR AS MATERIAL, WERE AS F OLLOWS: (A).TO PROMOTE COMMERCE AND TRADE IN ART SILK YARN, RAW SILK, COTTON YARN, ART SILK CLOTH, SILK CLOTH AND COTTON CLOTH. (B).TO CARRY ON ALL AND ANY OF THE BUSINESS OF ART SILK YARN, RAW SILK, COTTON YARN AS WELL AS ART SILK CLOTH, SILK CLOTH AND COTT ON CLOTH BELONGING TO AND ON BEHALF OF THE MEMBERS. (C).TO OBTAIN IMPORT LICENCES FOR IMPORT OF ART SIL K YARN, RAW SILK, COTTON YARN AND OTHER RAW MATERIALS AS WELL AS ACCESSORIES REQU IRED BY THE MEMBERS FOR THE MANUFACTURE OF ART SILK, SILK AND COTTON FABRIC S. ITA NO. 1246/AHD/2014 RAI UNIVERSITY VS. DIT (EXEMP) U/S 12A 11 (D).TO OBTAIN EXPORT LICENCES AND EXPORT CLOTH MANU FACTURED BY THE MEMBERS. (E).TO BUY AND SELL AND DEAL IN ALL KINDS OF CLOTH AND OTHER GOODS AND FABRICS BELONGING TO AND ON BEHALF OF THE MEMBERS. (F) * * (G) * * (H) * * (I) * * (J) * * (K) * * (L) * * (M) * * (N). TO DO ALL OTHER LAWFUL THINGS AS ARC INCIDENTA L OR CONDUCIVE TO THE ATTAINMENT OF THE ABOVE OBJECTS. CLAUSE 5 OF THE MEMORANDUM PROVIDED IN SUB-CLAUSE ( 2) THAT THE INCOME AND PROPERTY OF THE ASSESSEE WHERESOEVER DERIVED SHALL BE APPLIED SOLELY FOR THE PROMOTION OF ITS OBJECTS AS SET FORTH IN THE MEMORA NDUM AND SUB-CLAUSE (2) DIRECTED THAT NO PORTION OF THE INCOME OR PROPERTY SHALL BE PAID OR TRANSFERRED, DIRECTLY OR INDIRECTLY, BY WAY OF DIVI DEND, BONUS OR OTHERWISE BY WAY OF PROFIT, TO PERSONS, WHO AT ANY TIME ARE OR H AVE BEEN MEMBERS OF THE ASSESSEE OR TO ANYONE OR MORE OF THEM OR TO ANY PER SON CLAIMING THROUGH ANY ONE OR MORE OF THEM. WHAT SHOULD HAPPEN TO THE ASSE TS IN CASE OF WINDING UP OR DISSOLUTION OF THE ASSESSEE, WAS SET OUT IN CLAU SE 10 OF THE MEMORANDUM AND IT PROVIDED THAT THE PROPERTY REMAINING AFTER S ATISFACTION OF ALL THE DEBTS AND LIABILITIES SHALL NOT BE DISTRIBUTED AMONGST TH E MEMBERS OF THE ASSESSEE BUT SHALL BE GIVEN OR TRANSFERRED TO SUCH OTHER COM PANY HAVING THE SAME OBJECTS AS THE ASSESSEE, TO BE DETERMINED BY THE ME MBERS OF THE ASSESSEE AT OR BEFORE THE TIME OF THE DISSOLUTION OR, IN DEFAULT, BY THE HIGH COURT OF JUDICATURE THAT HAS OR MAY ACQUIRE JURISDICTION IN THE MATTER. THE INCOME OR PROPERTY OF THE ASSESSEE WERE THUS LIABLE TO BE APP LIED SOLELY AND EXCLUSIVELY FOR THE PROMOTION OF THE OBJECTS SET OUT IN THE MEM ORANDUM AND NO PART OF SUCH INCOME, OR PROPERTY COULD BE DISTRIBUTED AMONG ST THE MEMBERS IN ANY FORM OR UNDER ANY GUISE OR UTILISED FOR THEIR BENEF IT EITHER DURING THE OPERATIONAL EXISTENCE OF THE ASSESSEE OR ON ITS WIN DING UP AND DISSOLUTION.' 3. IN THE CASE OF JAMMU DEVELOPMENT AUTHORITY 52 SOT 153 ITAT AMRITSAR IN PARA 7.6 STATED AS UNDER:- 'ALSO AS PER CLAUSE 53 OF THE JAMMU & KASHMIR DEVEL OPMENT ACT, ON DISSOLUTION OF ALL PROPERTIES AND FUNDS TO VEST IN THE GOVERNMENT AND FOR THE PURPOSE OF REALIZING PROPERTIES, THE FUNCTION OF TH E AUTHORITY SHALL BE ITA NO. 1246/AHD/2014 RAI UNIVERSITY VS. DIT (EXEMP) U/S 12A 12 DISCHARGED BY THE GOVERNMENT. WE CONCUR WITH THE VI EWS OF THE LD. CIT ON TRANSFER OF THE PROPERTIES, FUNDS AND DUES AND LIAB ILITIES ETC. WILL VEST IN THE GOVT. THERE IS NO RESTRICTION, HOW THE SAME ARC TO BE UTILIZED BY THE GOVERNMENT. THERE ARE OTHER OBJECTS LIKE SALE AND P URCHASE, WHICH MAKES THE AUTHORITY A COMMERCIAL ORGANIZATION. THEREFORE, IN THE FACTS AND CIRCUMSTANCES OF THE CASE, EVEN ON DISSOLUTION OR W INDING UP BY NOT HAVING ANY RESTRICTION ON APPLICATION OF ASSET FOR CHARITA BLE PURPOSE, THE OBJECTS PURSUED BY THE ASSESSEE CANNOT BE SAID TO BE A CHAR ITABLE IN NATURE.' IN VIEW OF THE ABSENCE OF DISSOLUTION CLAUSE, IT IS , THEREFORE, REQUESTED THAT THE PLEA OF APPELLANT MAY BE TURN DOWN TO GRANT 12AA UN DER THE IT ACT 1961. YOURS SINCERELY SD/- (VIMALENDU VERMA) CIT(DR)-IV, D BENCH, AHMEDABAD 7. WE FIND THAT THE LD. DIRECTOR OF INCOME TAX (EXE MPTIONS) HAS REJECTED THE APPLICATION FILED BY THE ASSESSEE U/S 12A OF TH E ACT, BY OBSERVING AS UNDER:- 12. IN VIEW OF THE ABOVE, APPLICATION U/S 12A IS REJECTED FOR THE FOLLOWING REASONS: (I) THE APPLICANT UNIVERSITY DOES NOT HAVE ANY DEED. ME MORANDUM OF ARTICLE OR MEMORANDUM OF ASSOCIATION. EVEN IF THE F IRST STATUTE IS TREATED AS RULES &' REGULATIONS, STILL THERE IS NO CLAUSE THAT THE UNIVERSITY WILL NOT BE DISSOLVED AND IF AT ALL IT H AS TO BE DISSOLVED, ITS ASSETS WILL GO TO ANOTHER TRUST CARRYING ON SIMILAR , ACTIVITIES OF UNIVERSITY EDUCATION. (II) GUJARAT PRIVATE UNIVERSITY ACT PERMITS THE SPONSORI NG BODY TO DISSOLVE ITSELF AND ONLY THAT, IT PERMITS THE SPONSORING BOD Y TO DISSOLVE THE UNIVERSITY AND TAKE BACK ALL ITS ASSETS WHICH WOULD BE PUBLIC ASSETS BUILT BY THE UNIVERSITY ON THE BASIS OF TAX EXEMPTION AND PUBLIC FUNDS. THIS CANNOT BE PERMITTED IN RESPECT OF ANY CHARITABLE IN STITUTION. FURTHER, IF THE SPONSORING BODY DISSOLVES ITSELF WHERE WILL TH E ASSETS GO. (III) NEITHER IN THE GUJARAT PRIVATE UNIVERSITY ACT NOR I N THE FIRST STATUTE, IS THERE ANY CLAUSE THAT THE UNIVERSITY IS BOUND TO ACT AS A CHARITABLE INSTITUTION AND NOT FOR PROFIT MAKING. EDUCATION P ER SE IS NOT CHARILY. THE CHARITABLE ACTIVITY MUST REFLECT NOT ONLY FROM THE DEED BUR ALSO FROM THE ACTIVITIES. ITA NO. 1246/AHD/2014 RAI UNIVERSITY VS. DIT (EXEMP) U/S 12A 13 (IV) THE UNIVERSITY IS NOT INDEPENDENT BODY BUT ALMOST A BSOLUTELY CONTROLLED BY THE SPONSORING BODY WITH RESPECT TO APPOINTMENTS AS WELL AS FUNDS. IN VIEW OF THE ABOVE, THE APPLICATION U/S 12A IS RE JECTED AS THE ACTIVITIES AND OBJECTS OF THE TRUST CANNOT BE SAID TO BE GENUINELY CHARITABLE. [ 8. FROM THE ABOVE FINDING OF LD. DIT(E), IT IS EVID ENT THAT THE LD. DIT(E) IS CONCERNED ABOUT THE ASSETS OF THE UNIVERSITY IN THE EVENT OF DISSOLUTION AND WHAT WOULD BE THE FATE OF THE ASSETS CREATED IN THE EVENT OF DISSOLUTION OF UNIVERSITY. UNDER THE IDENTICAL FACTS, THE HON BLE HIGH COURT OF PUNJAB & HARYANA IN THE CASE OF CIT VS. O.P. JINDAL GLOBAL UNIVERSITY (SUPRA), WAS PLEASED TO DECIDE THE ISSUE IN FAVOUR OF THE ASSESS EE. 9. IN THE INSTANT CASE, IN CASE OF DISSOLUTION OF U NIVERSITY, PROPERTY WOULD GO TO SPONSORING BODY THAT ITSELF IS REGISTER ED UNDER SECTION 12AA OF THE ACT, SUBJECTED TO THE RELEVANT PROVISIONS OF TH E ACT. UNDISPUTEDLY, THE EDUCATION IS INCLUDED INTO THE DEFINITION OF CHARIT ABLE PURPOSE AS PER SECTION 2(15) OF THE ACT. IT IS SETTLED POSITION OF LAW THA T AT THE TIME OF REGISTRATION U/S 12AA OF THE ACT, THE DIT(E) HAS TO SATISFY WITH REGARD TO THE GENUINENESS OF ACTIVITIES OF THE TRUST. IN OUR CON SIDERED VIEW, THE DIT(E) OUGHT TO HAVE GIVEN SPECIFIC FINDING WITH REGARD TO GENUINENESS OF THE ACTIVITIES OF THE UNIVERSITY. THE DIT(E) HAS REJEC TED THE APPLICATION ON THE GROUND THAT IN CASE OF DISSOLUTION THERE IS NO SAFE GUARD TO THE PROPERTIES CREATED BY THE UNIVERSITY. THERE IS NO FINDING THA T THE UNIVERSITY IS NOT IMPARTING EDUCATION, OR OTHERWISE IMPARTING OF SUCH EDUCATION ON THE BASIS OF COMMERCIAL CONSIDERATION. IT IS POINTED OUT BY THE LD. COUNSEL FOR THE ASSESSEE THAT AS PER THE GUJARAT GOVERNMENT GAZETTE NOTIFICATION UNDER THE PROVISIONS OF THE GUJARAT PRIVATE UNIVERSITIES ACT, 2009, THE UNIVERSITY CANNOT RUN COMMERCIALLY. THE LD. DR COULD NOT CONT ROVERT THE CONTENTION OF ITA NO. 1246/AHD/2014 RAI UNIVERSITY VS. DIT (EXEMP) U/S 12A 14 THE LD. COUNSEL FOR THE ASSESSEE THAT UNDER THE IDE NTICAL FACTS OTHER UNIVERSITIES HAVE BEEN GRANTED REGISTRATION U/S 12A A BY THE REVENUE. UNDER THESE FACTS, WE ARE OF THE VIEW THAT THE LD. DIT(E) WAS NOT JUSTIFIED IN DECLINING THE REGISTRATION TO THE ASSESSEE U/S.12AA OF THE INCOME-TAX ACT, 1961. MOREOVER, THE ASSESSEE HAS PLACED RELIANCE O N VARIOUS JUDICIAL PRONOUNCEMENTS. THE LD. DIT(E) HAS NOT ADVERTED ON THE SUBMISSION OF THE ASSESSEE THAT THE CASE OF THE ASSESSEE IS ALSO COVE RED BY THE JUDGMENT OF HONBLE HIGH COURT OF PUNJAB AND HARYANA IN THE CAS E OF CIT VS. O.P. JINDAL GLOBAL UNIVERSITY (SUPRA), WHEREIN THE HONBLE HIGH COURT HAS HELD AS UNDER:- 13. IN ITA NO.701 OF 2010 TITLED CIT V. SURYA EDUCATION AL & CHARITBALE TRUST [2011] 203 TAXMAN 53/15 TAXMANN.COM 123 (PUNJ & HAR.) IT HAS BEEN HELD BY THIS COURT THAT AT THE STAGE OF REGIST RATION UNDER SECTION 12AA OF THE ACT, THE EXTENT AND NATURE OF ACTIVITIES ARE NOT REQUIRED TO BE EXAMINED. THAT QUESTION IS REQUIRED TO BE EXAMINED IN ASSESSM ENT PROCEEDINGS. THE COURT OBSERVED AS UNDER: THEREFORE, THE OBJECT OF SECTION 12AA OF THE ACT, IS TO EXAMINE THE GENUINENESS OF THE OBJECTS OF THE TRUST, BUT NOT TH E INCOME OF THE TRUST FOR CHARITABLE OR RELIGIOUS PURPOSES. THE ST AGE OF APPLICATION OF INCOME IS YET TO ARRIVE I.E. WHEN SUCH TRUST OR INS TITUTION FILES ITS RETURN. THEREFORE, WE FIND THAT THE JUDGMENT REFERR ED TO BY THE LEARNED COUNSEL FOR THE APPELLANT ARE NOT APPLICABLE TO THE FACTS OF THE PRESENT CASE ARISING OUT OF THE QUESTION OF REGISTRATION OF THE TRUST AND NOT OF ASSESSMENT. 14. THE ISSUE HAS BEEN EXAMINED THAT AT THE STAGE O F REGISTRATION AND FOR EXEMPTION UNDER SECTION 80G OF THE ACT, THE STATED OBJECT OF THE TRUST IS REQUIRED TO BE EXAMINED. WHETHER THE FUNDS ARE PROP ERLY APPLIED OR NOT, CAN BE EXAMINED BY THE ASSESSING OFFICER AT THE TIME OF FRAMING THE ASSESSMENT. ITA NO. 1246/AHD/2014 RAI UNIVERSITY VS. DIT (EXEMP) U/S 12A 15 THEREFORE, WE HEREBY SET ASIDE THE ORDER OF THE D IT(E) AND DIRECT HIM TO GRANT THE REGISTRATION TO THE ASSESSEE-UNIVERSIT Y. THUS, THE ASSESSEES APPEAL IS ALLOWED. 10. IN THE RESULT, THE ASSESSEES APPEAL IS ALLOWED . ORDER PRONOUNCED IN THE COURT ON 10 TH JUNE, 2015 AT AHMEDABAD. SD/- SD/- (ANIL CHATURVEDI) ACCOUNTANT MEMBER (KUL BHARAT) JUDICIAL MEMBER AHMEDABAD; DATED 10/06/2015 *BIJU T. *+ $ %, -*,)% *+ $ %, -*,)% *+ $ %, -*,)% *+ $ %, -*,)%/ COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. % . / CONCERNED CIT 4. . ( ) / THE CIT(A) 5. ,'12 %! , , / DR, ITAT, AHMEDABAD 6. 23 4# / GUARD FILE . *+! *+! *+! *+! / BY ORDER, TRUE COPY 5 55 5/ // / 6 6 6 6 ( DY./ASSTT.REGISTRAR) , , , , / ITAT, AHMEDABAD