Chetanya Shiksha Evam Vikas Parishad Samiti, Gwalior V. C.I.T., Gwalior

ITA 129/AGR/2013

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 9961 (ITAT-AGRA)
• Duration Of Justice: 2 year(s) 9 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-02-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 14-07-2014
• Assessment Year: misc
• Appeal Filed On: 23-04-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: RAJENDER SHARMA
• Keywords: Charitable institution
• Section: 12A; 12AA

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL AGRA BENCH, AGRA BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND MS. ANNAPURNA MEHROTRA, ACCOUNTANT MEMBER ITA NO.129/AG/2013 ASSESSMENT YEAR: UNDER SECTION 12AA CHETANYA SHIKSHA EVAM VIKAS, VS. THE CIT PARISHAD SAMITI GWALIOR, GWALIOR PAN NO. AAATC9795J (APPELLANT) (RESPONDENT) APPELLANT BY : SH. RAJENDER SHARMA RESPONDENT BY : SH. RAJARSHI DWIVEDY DATE OF HEARING : 27/01/2016 DATE OF PRONOUNCEMENT : 09/02/2016 ORDER PER ANNAPURNA MEHROTRA A.M. THIS APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE ORDER OF LD. CIT(A) GWALIOR DT. 22/02/2013 REFUSING GRANT OF REGISTRATI ON UNDER SECTION 12AA. 2. THE ASSESSEE HAS TAKEN THE FOLLOWING GROUNDS OF APPEAL 1. ON THE FACTS & IN THE CIRCUMSTANCES OF THE CASE, THE CIT, GWALIOR GROSSLY ERRED IN LAW & ON FACTS IN REFUSING THE REGISTRATIO N TO THE APPELLANT SOCIETY U/S 12AA OF THE INCOME TAX ACT, 1961. 3. BRIEF FACTS RELATING TO THE CASE ARE THAT THE AS SEESSEE SOCIETY FILED AN APPLICATION IN FORM NO. 10A SEEKING REGISTRATION UN DER SECTION 12AA OF THE ACT 2 ON 09/08/2012. DURING THE PROCEEDINGS CONDUCTED UND ER SECTION 12AA, A REPORT WAS CALLED FROM THE AO TO VERIFY THE GENUINENESS OF THE ACTIVITIES OF THE SOCIETY. THE SAME WAS FORWARDED TO THE LD. CIT, WHO ON GOING THROUGH THE REPORT AND THE APPLICATION FILED BY THE SOCIETY, OBSERVED THAT FOR THE FY 2010-11 THE ASSESSEE SOCIETY HAD RECEIVED CORPUS DONATION OF RS . 7.21 LACS IN CASH OUT OF WHICH AN AMOUNT OF RS. 3.882 LACS HAD BEEN RECEIVED FROM VARIOUS PERSONS WHO WERE RESIDENTS OF 61, GEETA COLONY, DAL BAZAAR, GW ALIOR DURING THE PERIOD 26/04/2010 TO 08/05/2010. THE GENUINENESS OF CORPUS DONATION WAS DOUBTED BY THE LD. CIT AND OPPORTUNITY WAS FORWARDED TO THE AS SESSEE TO JUSTIFY THE GENUINENESS OF ITS CHARITABLE ACTIVITIES. WRITTEN S UBMISSIONS WERE FILED BY THE ASSESSEE SOCIETY, AFTER CONSIDERING WHICH, THE LD. CIT HELD THAT THE GENUINENESS OF THE CHARITABLE ACTIVITY CARRIED OUT BY THE SOCIE TY HAD NOT BEEN ESTABLISHED IN THE ABSENCE OF PRODUCTION OF BOOKS OF ACCOUNT, BILL S, VOUCHERS AND SUPPORTING RELEVANT DOCUMENTARY EVIDENCES AND ALSO THE GENUINE NESS OF THE CORPUS DONATION OF RS. 7.21 LACS AND THEREFORE REGISTRATIO N UNDER SECTION 12AA WAS REFUSED TO BE GRANTED TO THE ASSESSEE SOCIETY. 4. AGGRIEVED BY THE SAME THE ASSESSEE FILED THE PRE SENT APPEAL BEFORE US . 5. BEFORE US THE LD. AR SUBMITTED THAT ONE OF THE R EASON FOR REFUSING REGISTRATION UNDER SECTION 12AA, WAS THE NON PRODUC TION OF BOOKS OF ACCOUNT OF THE ASSESSEE SOCIETY. LD. AR STATED THAT THIS WAS A N INCORRECT FINDINGS / OBSERVATIONS OF THE LD. CIT SINCE THE BOOKS OF ACCO UNT WERE PRODUCED DURING THE PROCEEDINGS UNDER SECTION 12AA. LD. AR DREW OUR ATTENTION TO PAPER BOOK 3 PAGE NO. 62, 63, & 64 WHICH CONTAINED THREE LETTERS SUBMITTED BY THE ASSESSEE SOCIETY TO THE ACIT GWALIOR WHO WAS CARRYING OUT TH E PROCEEDINGS UNDER SECTION 12AA, DT. 03/09/2012, 20/12/2012 & 18/02/2013, WHER EIN IT WAS MENTIONED THAT BOOKS OF ACCOUNTS WERE BEING PRODUCED BEFORE THE AC IT. LD. AR FURTHER SUBMITTED THAT AS FAR AS THE ISSUE OF CORPUS DONATI ON WAS CONCERNED, DETAILED SUBMISSIONS HAD BEEN FILED TO THE ACIT VIDE THE ABO VE MENTIONED LETTERS. LD. AR SUBMITTED THAT THE DETAIL OF CORPUS DONATION WAS FI LED ALONGWITH LETTER DT. 03/09/2012 PLACED AT PAPER BOOK PAGE NO. 61. LD. AR FURTHER SUBMITTED THAT BOOKS OF ACCOUNT CONSISTING THE DETAILS OF CORPUS D ONATION WAS ALSO SUBMITTED TO THE ACIT, VIDE LETTER DT. 20/12/2012 PLACED AT P APER BOOK PAGE NO. 63. LD. AR FURTHER SUBMITTED THAT COPIES OF DONATION RECEIPTS ISSUED FOR CORPUS DONATION TO THE DONOR FOR THE RELEVANT PERIOD WERE ENCLOSED ALO NGWITH LETTER DT. 18/02/2013 ADDRESSED TO LD.CIT, GWALIOR DURING THE PROCEEDING FOR GRANT OF REGISTRATION UNDER SECTION 12AA AND PLACED AT PAPER BOOK PAGE NO . 64. LD. AR SUBMITTED THAT HAVING FILED ALL THE NECESSARY DETAILS AND EVI DENCES WITH REGARD TO THE CORPUS DONATION AND NO ADVERSE OBSERVATION REGARDIN G THE SAME HAVING BEEN MADE EITHER BY THE ACIT OR CIT, REGISTRATION UNDER SECTION 12AA COULD NOT HAVE BEEN REFUSED FOR THE REASON THAT GENUINENESS OF THE CORPUS DONATION WAS NOT PROVED BY THE ASSESSEE. LD. AR FURTHER SUBMITTED TH AT THERE WAS NO FINDING BY THE LD. CIT TO THE EFFECT THAT THE OBJECTS OF THE S OCIETY WERE NOT CHARITABLE AS DEFINED UNDER SECTION 2(15) OF THE ACT. 4 6. LD. AR STATED THAT INFACT THE ASSESSEE SOCIETY H AD BEEN ESTABLISHED FOR THE PURPOSE OF PROVIDING EDUCATION IN DIFFERENT FIE LDS, BY RUNNING SCHOOLS AND COLLEGES IN DIFFERENT DISCIPLINE ON CHARITABLE BASI S AND NOT FOR PROFITS AND ITS ACTIVITIES WERE CLEARLY CHARITABLE IN NATURE AS PER THE PROVISIONS OF SECTION 2(15) OF THE ACT. LD. AR FURTHER SUBMITTED THAT THE ASSES SEE SOCIETY IN PURSUANCE OF ITS OBJECT OF PROVIDING EDUCATION WAS RUNNING A D.ED. C OLLEGE IN THE NAME OF ROYAL COLLEGE OF EDUCATION & RESEARCH CENTRE, GWALIOR, UN DER THE APPROVAL AND NORMS OF NCTE, NEW DELHI FROM THE YEAR 2008 AND HAD ALSO STARTED ONE PRE- PRIMARY SCHOOL IN THE NAME OF PEARLS VALLEY SCHOOL FROM THE YEAR 2010. LD. AR SUBMITTED THAT AUDITED RECEIPT AND PAYMENT ACCOUNT , INCOME & EXPENDITURE ACCOUNT AND BALANCE SHEETS OF THE ASSESSEE SOCIETY AND THE ABOVE TWO EDUCATIONAL INSTITUTES BEING RUN BY IT, WERE SUBMIT TED BEFORE THE ACIT / CIT WHICH CLEARLY PROVED THAT THE ASSESSEE WAS GENUINEL Y CONDUCTING ITS CHARITABLE ACTIVITY ALSO. LD. AR STATED THAT NO INFIRMITY HAD BEEN FOUND IN THE FINANCIAL STATEMENTS SUBMITTED BEFORE THE LD. CIT. LD. AR THE REFORE SUBMITTED THAT THERE IS NO CASE FOR REFUSING TO GRANT REGISTRATION TO THE A SSESSEE SOCIETY UNDER SECTION 12AA OF THE ACT, SINCE ITS OBJECTS WERE GENUINE AND ALSO THE ACTIVITIES CARRIED OUT BY IT. LD. AR FURTHER DREW OUR ATTENTION TO THE COMMUNICAT ION OF THE ACIT WHO HAD CONDUCTED AN ENQUIRY U/S 12AA, ON THE ACTIVITIES CA RRIED OUT BY THE ASSESSEE SOCIETY, ADDRESSED TO THE LD. CIT RECOMMENDING THE GRANT OF REGISTRATION TO THE ASSESSEE SOCIETY U/S 12AA. LD. AR FURTHER DREW OUR ATTENTION TO THE INSPECTORS 5 ENQUIRY REPORT ATTACHED WITH THE AFOREMENTIONED LET TER TO THE LD.CIT, WHICH WAS A REPORT OF THE INSPECTOR WHO HAD VISITED THE PREMI SES OF THE ASSESSEE SOCIETY AND COMMENTED ON THE ACTIVITY OF THE ASSESSEE SOCIE TY AND STATED THAT THE ASSESSEE IS ENGAGED IN IMPARTING EDUCATION AT HIGHE R LEVEL BY RUNNING COURSE OF B.ED/D.ED AT ROYAL COLLEGE OF EDUCATION & RESEARCH CENTRE AND PRE-PRIMARY SCHOOL IN THE NAME OF PEARL VALLEY SCHOOL. LD. AR P OINTED OUT FROM THE REPORT THAT THE OBJECTS OF THE SOCIETY ALSO INCLUDE DEVELO PMENT OF CHILD AND WOMEN, RESEARCH IN THE FIELD OF ENVIRONMENT, HEALTH, SPORT S, WELFARE OF HANDICAPPED, DEVELOPMENT OF VILLAGES AND WORK IN THE FIELD OF CO MPUTER EDUCATION. LD. AR THEREFORE STATED THAT EVEN AS PER THE INTERNAL REPO RT OF THE DEPARTMENT IT HAD BEEN RECOMMENDED FROM ALL QUARTERS THAT THE ASSESSE E WAS ELIGIBLE FOR GRANT OF REGISTRATION UNDER SECTION 12AA AND THEREFORE THE D ECISION OF REFUSAL BY THE LD. CIT HAD NO BASIS AT ALL. 7. LD. DR ON THE OTHER HAND RELIED UPON THE ORDER O F THE LD. CIT AND REFERRED TO A LETTER WRITTEN BY THE JCIT, RANGE-2, GWALIOR T O THE CIT, STATING THAT THE GENUINENESS OF THE DONATION RECEIVED WERE NOT BEYON D DOUBT. 8. WE HAVE HEARD THE RIVAL SUBMISSION AND PERUSED T HE ORDERS OF THE AUTHORITIES BELOW AS ALSO THE DOCUMENTS PLACED BEFO RE US. 9. THE ONLY ISSUE IN THE PRESENT APPEAL IS THE REFU SAL OF REGISTRATION UNDER SECTION 12AA. IT IS SETTLED LAW THAT FOR THE PURPOS E OF GRANTING REGISTRATION. THE COMMISSIONER IS REQUIRED TO LOOK INTO THE FULFILLME NT OF ONLY TWO CONDITIONS: 1. THE GENUINENESS OF THE OBJECTS OF THE TRUST. 6 2. THE GENUINENESS OF THE ACTIVITIES OF THE TRUST. BASED ON THE ABOVE TOUCHSTONE WE FIND THAT IN THE P RESENT CASE THE LD. CIT HAS REFUSED TO GRANT REGISTRATION FOR THE REASON THAT T HE GENUINENESS OF THE CHARITABLE ACTIVITY OF THE TRUST HAD NOT BEEN ESTAB LISHED. ONE OF THE REASON FORWARDED BY THE LD. CIT FOR HOLD ING SO, IS THAT BOOKS OF ACCOUNT, BILLS, VOUCHERS AND SUPPORTING RELEVANT DO CUMENTARY EVIDENCE WERE NOT FILED BY THE ASSESSEE SOCIETY. ON A PERUSAL OF THE DOCUMENTS FILED, WE FIND THAT B OOKS OF ACCOUNT WERE PRODUCED TWICE BEFORE THE ACIT CONDUCTING THE ENQUI RY AND ONCE BEFORE THE LD. CIT. THE BOOKS OF ACCOUNT WERE FIRST PRODUCED B EFORE THE ACIT ON 03/09/2012 AND THEN ON 20/12/2012 WHICH IS EVIDENT FROM THE LETTER FILED BY THE ASSESSEE SOCIETY TO THE ACIT AND PLACED AT PB PAGE NO. 61 TO 63. ON 18/02/2013 BOOKS OF ACCOUNT FOR FY 2010-11 ALONGWITH BILLS AND VOUCHERS WAS PRODUCED BEFORE THE LD. CIT WHICH IS EVIDENT FROM THE LETTER PLACED AT PB PAGE NO. 64. THEREFORE THE GRIEVANCE OF THE LD. CIT THAT BOOKS O F ACCOUNT WERE NOT PRODUCED BEFORE IT IS UNFOUNDED AND CANNOT BE THE B ASIS FOR FORMATION OF BELIEF OF THAT ACTIVITY OF THE ASSESSEE SOCIETY WERE NOT G ENUINE. 10. LD. CIT WE FIND HAS ALSO REFUSED REGISTRATION, SINCE THE ASSESSEE SOCIETY COULD NOT ESTABLISH THE GENUINENESS OF THE CORPUS D ONATION RECEIVED BY IT AMOUNTING TO RS. 7.21 LACS. 11. AS FAR AS THIS ISSUE IS CONCERNED, WE FIND THAT THE SAME CANNOT BE A CONSIDERATION BEFORE GRANTING / REFUSING REGISTRATI ON U/S 12AA. THE SCOPE OF 7 ENQUIRY OF THE COMMISSIONER AS STATED ABOVE, IS LIMI TED TO LOOKING INTO ONLY THE GENUINENESS OF THE OBJECTS AND ACTIVITIES OF THE TRUST / INSTITUTION. GENUINENESS OF THE ACTIVITIES MEANS THEY ARE IN CONSONANCE WITH THE OBJECTS OF THE TRUST / INSTITUTION AND ARE REAL, PURE AND SINCERE AND NOT A MERE CAMOUFLAGE. THE HONBLE ALLAHABAD HIGH COURT HAS DEALT WITH THE SCOPE OF ENQUIRY TO BE CONDUCT ED BY THE COMMISSIONER WHILE GRANTING REGISTRATION U/S 12AA IN THE CASE OF CIT VS. RE D ROSE SCHOOL (2007) 212 CTR 394 WHERE IN IT HAS HELD AS UNDER: A READING OF PROVISIONS OF SUB-CLS. (A) AND (B) OF S. 12AA MAKES IT CLEAR THAT THE CIT HAS TO SATISFY HIMSELF ABOUT THE GENUINENESS OF THE ACTIVITIES OF THE TRUST OR INSTITUTION AND ALSO ABOUT THE OBJECTS OF THE TRUST OR THE INSTITUTION. ON BEING SATISFIED ABOUT THE GENUINENESS OF THE ACTIVITIES O F THE TRUST OR THE INSTITUTION AND ALSO ABOUT ITS OBJECTS, THE CIT WOULD EITHER GRANT THE CERTIFICATE OR WOULD REJECT THE PRAYER. IN ORDER TO SATISFY HIMSELF ABOUT THE G ENUINENESS OF THE ACTIVITIES OF THE TRUST OR THE INSTITUTION, HE CAN CALL FOR SUCH DOCU MENTS OR INFORMATION FROM THE TRUST OR THE INSTITUTION, AS HE THINKS NECESSARY AND HE I S ALSO EMPOWERED TO MAKE SUCH ENQUIRIES AS HE MAY DEEM NECESSARY IN THIS BEHALF. THE OBJECTS OF THE TRUST CAN BE HAD FROM THE BYE-LAWS OR THE DEED OF TRUST, AS THE CASE MAY BE AND UNLESS, OF COURSE, THE OBJECTS OF THE TRUST APPARENTLY MAKE OU T THAT THEY WERE NOT IN CONSONANCE WITH THE PUBLIC POLICY OR THAT THEY WERE NOT THE OBJECTS OF ANY CHARITABLE PURPOSE, REGISTRATION CANNOT BE REFUSED ACCORDINGLY ON THIS GROUND. IN REGARD TO THE GENUINENESS OF THE ACTIVITIES OF THE TRUST OR THE INSTITUTION, WHOSE OBJECTS DO NOT RUN CONTRARY TO PUBLIC POLICY AND AR E, IN FACT, RELATED TO CHARITABLE PURPOSES, THE CIT IS AGAIN EMPOWERED TO MAKE ENQUIR IES AS HE THINKS FIT. IN CASE THE ACTIVITIES ARE NOT GENUINE AND THEY ARE NOT BEI NG CARRIED OUT IN ACCORDANCE WITH THE OBJECTS OF THE TRUST/SOCIETY OR THE INSTIT UTION, OF COURSE, THE REGISTRATION CAN AGAIN BE REFUSED. BUT ON MERE PRESUMPTIONS AND ON SURMISES THAT INCOME DERIVED BY THE TRUST OR THE INSTITUTION IS BEING MI SUSED OR THAT THERE IS SOME APPREHENSION THAT THE SAME WOULD NOT BE USED IN THE PROPER MANNER AND FOR THE PURPOSES RELATING TO ANY CHARITABLE PURPOSE, REJECT ION CANNOT BE MADE. SEC. 12AA, WHICH LAYS DOWN THE PROCEDURE FOR REGISTRATIO N, DOES NOT SPEAK ANYWHERE THAT THE CIT, WHILE CONSIDERING THE APPLICATION FOR REGISTRATION, SHALL ALSO SEE THAT THE INCOME DERIVED BY THE TRUST OR THE INSTITUTION IS EITHER NOT BEING SPENT FOR CHARITABLE PURPOSE OR SUCH INSTITUTION IS EARNING P ROFIT. THE LANGUAGE USED IN THE SECTION ONLY REQUIRES THAT ACTIVITIES OF THE TRUST OR THE INSTITUTION MUST BE GENUINE, WHICH ACCORDINGLY WOULD MEAN, THEY ARE IN CONSONANC E WITH THE OBJECTS OF THE TRUST/INSTITUTION, AND ARE NOT MERE CAMOUFLAGE BUT ARE REAL, PURE AND SINCERE, NOR AGAINST THE PROPOSED OBJECTS. THE PROFIT EARNING OR MISUSE OF THE INCOME DERIVED BY CHARITABLE INSTITUTION FROM ITS CHARITABLE ACTIV ITIES, MAY BE A GROUND FOR REFUSING EXEMPTION ONLY WITH RESPECT TO THAT PART OF THE INC OME BUT CANNOT BE TAKEN TO BE A SYNONYM TO THE GENUINENESS OF THE ACTIVITIES O F THE TRUST OR THE INSTITUTION. IT IS SIGNIFICANT TO MENTION THAT REGISTRATION UNDER S. 1 2AA DOES NOT NECESSARILY ENTITLE THE ASSESSEE TO GET THE INCOME EXCLUDED FROM THE IN COME OF THE PREVIOUS YEAR 8 FOR THE PURPOSE OF DETERMINATION OF TAX LIABILITY B UT IT ONLY ENTITLES THE ASSESSEE TO CLAIM SUCH EXEMPTION, WHICH OTHERWISE COULD NOT BE CLAIMED IN THE ABSENCE OF REGISTRATION. THE ENQUIRY BY THE CIT SHALL REMAIN R ESTRICTED TO THE EXAMINATION, AS TO WHETHER THE ASSESSEE, WHO HAS MOVED THE APPLICAT ION FOR REGISTRATION UNDER S. 12A, IS ACTUALLY IN THE ACTIVITIES WHICH ARE GENUIN E. GENUINENESS OF THE ACTIVITIES OF THE TRUST OR THE INSTITUTION HAS TO BE SEEN, KEE PING IN MIND THE OBJECTS THEREOF, WHICH NECESSARILY MEANS THAT THE CIT SHALL SATISFY HIMSELF ABOUT THE FACT THAT THE ACTIVITIES ARE GENUINE AND IN CONSONANCE WITH THE O BJECTS OF THE TRUST OR THE INSTITUTION. IN OTHER WORDS, IF ESTABLISHING AND RU NNING A SCHOOL IS THE OBJECT OF THE SOCIETY, AS GIVEN IN ITS BYE-LAWS, IT HAS TO BE SAT ISFIED THAT THE SOCIETY HAS ESTABLISHED THE SCHOOL, WHERE EDUCATION IS BEING IM PARTED AS PER RULES AND THE FACTUM OF ESTABLISHMENT AND RUNNING SCHOOL IS A GEN UINE ACTIVITY. THE ENQUIRY REGARDING GENUINENESS OF THE ACTIVITIES CANNOT BE S TRETCHED BEYOND THIS. SUFFICIENT SAFEGUARDS HAVING BEEN GIVEN IN SS. 11, 12 AND 13 FOR ASSESSING THE INCOME WHICH HAS NOT BEEN APPLIED TO THE PURPOSE OF THE TRUST OR THE INSTITUTION, THE INTENTION OF THE LAW MAKER AND THE SCOPE AND PU RPORT OF THE PROVISION IS APPARENT WHILE CONSIDERING THE QUESTION OF REGISTRA TION. ON THIS PARAMETER, THE GENUINENESS OR OTHERWISE OF DONATIONS RECEIVED HAS NO REFLECTION ON THE ACTIVITIES CARRIED OUT BY THE ASSESSEE SOCIETY. BECAUSE THE DONATIONS ARE FOUND TO BE BOGUS, IT DOE S NOT AS A COROLLARY MEAN THAT THE ACTIVITIES OF THE TRUST ARE NOT GENUI NE. THESE ISSUES CAN BE EXAMINED DURING ASSESSMENT PROCEEDINGS AND NOT WHIL E GRANTING REGISTRATION U/S 12A TO A TRUST / SOCIETY. EVEN OTHERWISE WE FIND THAT THE ASSESSEE HAD SUBMIT TED COMPLETE DETAILS OF CORPUS DONATION RECEIVED BY IT AND ALSO ALL THE COP IES OF DONATIONS RECEIVED THROUGH THE DONORS. LD. CIT/ACIT WE FIND HAVE NOT C OMMENTED ON THE SAME NOR CONDUCTED ANY FURTHER INQUIRY TO ESTABLISH THE GENU INENESS / OTHERWISE OF THE DONATIONS. THE ASSESSEE WE FIND HAS DISCHARGED HIS ONUS OF ESTABLISHING THE GENUINENESS OF THE DONATION AND THE LD. CIT HAVING NOT ACTED FURTHER UPON THE EVIDENCE PLACED BEFORE IT, IT HAS NOT BEEN THEREFOR E CONCLUSIVELY PROVED THAT 9 THE DONATIONS WERE NOT GENUINE, NOR COULD THE BLAME IN THE PRESENT CIRCUMSTANCES BE PLACED AT THE DOOR OF THE ASSESSEE SOCIETY. 12. BESIDES WE FIND THAT AUDITED FINANCIAL STATEMEN TS OF THE ASSESSEE SOCIETY FOR THE YEAR ENDED 31/03/2007, 31/03/2008, 31/03/20 09, 31/03/2010 & 31/03/2011 WERE ALSO FILED BEFORE THE ACIT/CIT. THE DETAILS OF THESE FINANCIAL STATEMENTS CLEARLY REFLECTED THAT THE ASSESSEE SOCIETY HAD BEG UN RUNNING AN EDUCATIONAL INSTITUTION GOING BY THE NAME OF ROYAL COLLEGE OF E DUCATION & RESEARCH CENTRE IN THE YEAR ENDED 31/03/2008. A PERUSAL OF THE INCO ME & EXPENDITURE ACCOUNT OF THE ASSESSEE SOCIETY FOR YEAR ENDED 31.03.2009 R EVEALS THAT EDUCATIONAL ACTIVITY IN THE AFOREMENTIONED COLLEGE HAD COMMENCE D AND THAT THE ASSESSEE SOCIETY HAD REFLECTED AN EXCESS OF EXPENDITURE OVER INCOME DURING THIS YEAR AMOUNTING TO RS. 24,402/-. FURTHER THE ASSESSEE HAD ASSETS OF THE WRITTEN DOWN VALUE OF RS. 2,76,718/- IN THE IMPUGNED YEAR. IN TH E YEAR ENDING 31/03/2011, THE ASSESSEE HAD STARTED ANOTHER SCHOOL GOING BY THE NA ME OF PEARL VALLEY SCHOOL AND COMMENCED EDUCATIONAL ACTIVITY IN THE SAME ALSO SHOWING EXCESS OF EXPENDITURE OVER INCOME OF RS. 1,85,585/- WITH ASSE TS OF RS. 5,54,425/-. BESIDES EDUCATIONAL ACTIVITY WERE BEING CARRIED ON IN THE R OYAL COLLEGE OF EDUCATION & RESEARCH CENTRE ALSO AND IN THE YEAR ENDING 31.03.2 011 THERE WAS EXCESS OF INCOME OVER EXPENDITURE OF RS. 36,464/- AND THE WDV OF ASSETS TOTALLED AT RS. 1,83,382/-. FROM THE ABOVE FACTS IT IS AMPLY CLEAR THAT ONE OF THE MAIN OBJECT OF THE ASSESSEE SOCIETY WAS CARRYING EDUCATIONAL ACTIVITIE S WHICH IS CLEARLY A CHARITABLE 10 ACTIVITY AS DEFINED U/S 2(15) OF THE INCOME TAX ACT . FURTHER IN PURSUANCE OF ITS MAIN OBJECT THE ASSESSEE WAS CONDUCTING THE ACTIVIT Y OF IMPARTING EDUCATION IN THE TWO INSTITUTES ESTABLISHED BY IT BEING ROYAL C OLLEGE OF EDUCATION & RESEARCH CENTRE & PEARL VALLEY SCHOOL. WE FIND THAT THESE DOCUMENTS WERE THERE BEFORE THE LD. CIT WHO FOUND NO INFIRMITY IN THE SAME. THEREFORE IT CAN BE SAFELY C ONCLUDED THAT THE ACTIVITIES OF THE ASSESSEE SOCIETY WERE CHARITABLE AND WERE BEING GENUINELY CARRIED OUT BY IT. 13. IN VIEW OF THE SAME, WE HOLD THAT LD. CIT COUL D NOT HAVE REFUSED REGISTRATION UNDER SECTION 12AA TO THE ASSESSEE SOC IETY. THE RECOMMENDATION OF THE ACIT WHO HAD CONDUCTED THE ENQUIRY IN THIS REG ARD ALSO CONFIRM THE FACT THAT THE ASSESSEE WAS ELIGIBLE FOR GRANT OF REGISTR ATION UNDER SECTION 12AA. THE ACIT HAD VERY CLEARLY STATED THAT THE ASSESSEE SOC IETY FULFILLED ALL THE CONDITIONS REQUIRED FOR REGISTRATION UNDER SECTION 12AA, COPY OF THE LETTER OF THE ACIT IS REPRODUCED HERE UNDER: CIR-2/GWL/12AA 11-12 DATE:26/12/2012 THE COMMISSIONER OF INCOME TAX GWALIOR THE JOINT COMMISSIONER OF INCOME TAX, RANGE-2, GWAL IOR MADAM, SUB: APPLICATION FOR REGISTRATION U/S 12AA OF THE I .T. ACT, 1961- IN THE CASE OF CHTANYA SHIKSH EVAM VIKAS PARISHAD, 52, SHARDA VIHA R, CITY CENTRE, GWALIOR(M.P.)- REG- KINDLY REFER TO THE ABOVE SUBJECT 11 I AM ENCLOSING HEREWITH A REPORT ON THE APPLICATION FOR REGISTRATION U/S 12AA OF THE INCOME TAX ACT, 1961 FILED IN FORM NO. 10A ON 09/08/2012 BY THE ABOVE NAMED SOCIETY IN DUPLICATE IN PRESCRIBED PRO- FORMA. THE SOCIETY IS PRESENTLY ENGAGED IN IMPARTING EDUCA TION AT HIGHER LEVEL BY RUNNING COURSE OF B.ED/D.ED AT ROYAL COLLEGE OF EDU CATION & RESEARCH CENTRE LOCATED AT SITHOLI, DABARA ROAD GWALIOR AND PRIMARY LEVEL PRE-PRIMARY SCHOOL IN NAMED PEARL VELLY SCHOOL LOCATED AT GEETA COLONY, D AL BAZAR GWALIOR. OBJECTS OF THE SOCIETY ALSO INCLUDE DEVELOPMENT OF CHILD AN D WOMEN, RESEARCH IN THE FIELD OF ENVIRONMENT, HEALTH, SPORTS, WELFARE OF HA NDICAPPED, DEVELOPMENT OF VILLAGES AND WORK IN THE FIELD OF COMPUTER EDUCATIO N. IN VIEW OF THE ABOVE, IT APPEARS THAT THE OBJECTS A ND ACTIVITIES OF THE SOCIETY ARE CHARITABLE IN NATURE AND ALL THE CONDIT IONS HAVE BEEN FULFILLED BY THE SOCIETY REGISTRATION U/S 12AA MAY KINDLY BE GRANTED TO THE SOCIETY IF DEEMED FIT. THE REQUISITE REPORT IS SUBMITTED FOR KIND PERUSAL AND FURTHER NECESSARY ACTION PLEASE. YOURS FAITHFULLY ENCL: AS ABOVE SD/- (S.L. KATARA) ASSTT. COMMISSIONER OF INCOME TAX CIRCLE-2, GWALIOR FURTHER THE INSPECTOR DEPUTED TO CONDUCT ENQUIRY AB OUT THE ACTIVITY BEING CARRIED OUT BY THE ASSESSEE SOCIETY ALSO CLEARLY ST ATED THAT THE ACTIVITY WERE IN THE NATURE OF IMPARTING EDUCATION. THE INSPECTIORS REPORT IS BEING REPRODUCED HERE UNDER: INSPECTION ENQUIRY REPORT AS DIRECTED I VISITED OFFICE PREMISES OF CHETANYA S HIKSH EVAM VIKAS PARISHAD SITUATED AT 61. GEETA COLONY, DAL BAZAR, GWALIOR ON 14 TH DEC 2012. SHRI AMIT PAHARIYA, SECRETARY OF THE ABOVE PARISHAD WAS FOUND AVAILABLE ABOUT THE ACTIVITIES OF PARISHAD SHRI AMIT PAHARIYA, SECRETAR Y STATED THAT THE PARISHAD IS RUNNING ROYAL COLLEGE OF EDUCATION & RESEARCH CENTR E FOR B.ED/D.ED COURSE LOCATED AT SITHOLI, DABARA ROAD GWALIOR AND ALSO RU NNING ONE PRE-PRIMARY SCHOOOL IN NAMED PEARL VELLY SCHOOL LOCATED AT GEET A COLONY, DAL BAZAR, GWALIOR FOR GENUINENESS OF ACTIVITIES I ALSO VISITE D COLLEGE & SCHOOL WITH SHRI AMIT PAHARIYA, SECRETARY OF THE PARISHAD. I ASKED ABOUT THE ACTIVITIES OF THE PARISHAD THE MAIN OBJECT OF THE PARISHAD RUNNING COLLEGE & S CHOOL, GWALIOR. THE SOCIETY IS PRESENTLY ENGAGED IN IMPARTING EDUCATION AT HIGHER LEVEL BY RUNNING COURSE OF B.ED/D.ED AT ROYAL COLLEGE OF EDUCATION & RESEARCH CENTRE FOR B.ED/D.ED AND PRE-PRIMARY SCHOOL IN NAMED PEARL VELLY SCHOOL. OBJE CTS OF THE SOCIETY ALSO INCLUDE DEVELOPMENT OF CHILD AND WOMEN, RESEARCH IN THE FIELD OF ENVIRONMENT, 12 HEALTH, SPORTS, WELFARE OF HANDICAPPED, DEVELOPMENT OF VILLAGES AND WORK IN THE FIELD OF COMPUTER EDUCATION. SUBMITTED TO THE ACIT, C-2, GWALIOR FOR NECESSARY A CTION. SD/- (SIYARAM SHAKYAWAR) ITI, O/O THE ACIT, C-2, GWALIOR IT IS CLEARLY INDICATED FROM THE ABOVE THAT EVEN AS PER INQUIRIES CONDUCTED BY THE ACIT AND INSPECTOR, THE ASSESSEE SOCIETY WAS EL IGIBLE FOR GRANT OF REGISTRATION U/S 12AA. 14. IN VIEW OF THE ABOVE AND AFTER TAKING INTO CONS IDERATION THE ENTIRE FACTS OF THE CASE, WE HOLD THAT THE ASSESSEE SOCIETY IS ENTI TLED TO REGISTRATION U/S 12AA AND ACCORDINGLY SET ASIDE THE ORDER OF THE LD. CIT REFUSING REGISTRATION IN THIS REGARD. 15. THE APPEAL OF THE ASSESSEE THEREFORE STANDS ALL OWED. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- (BHAVNESH SAINI) (ANNAPURNA MEHROTRA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 09/02/2016 AG COPY TO: THE APPELLANT, THE RESPONDENT, THE CIT, THE CIT( A), THE DR