Institute Management Committee of Industrial Training Institute, Satara V. CIT-III, Pune

ITA 2175/PUN/2012

• Counselvise Citation: 217524514 RSA 2012
• Duration Of Justice: 1 year(s) 1 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-12-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: misc
• Appeal Filed On: 02-11-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A K MODI
• Assessee Lawyers: ANIL CHIKODI
• Keywords: Charitable institution; Opportunity of being heard; Rule of consistency; Cancellation of registration
• Section: 12A; 12AA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B, PUNE BEFORE SHRI R.S. PADVEKAR, JUDICIAL MEMBER AND SHRI R.K. PANDA, ACCOUNTANT MEMBER ITA NO. 2175/PN/2012 INSTITUTE MANAGEMENT COMMITTEE OF INDUSTRIAL TRAINING INSTITUTE, A/P. DAHIWADI, TAL : MAN, DIST : SATARA PAN NO. AAATI7834G .. APPELLANT VS. CIT-III, PUNE .. RESPONDENT APPELLANT BY : SHRI ANIL CHIKODI RESPONDENT BY : SHRI A.K. MODI DATE OF HEARING : 02-12-2013 DATE OF PRONOUNCEMENT : 13-12-2013 ORDER PER R.K. PANDA, AM : THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAIN ST THE ORDER DATED 28-09-2012 OF THE CIT-III, PUNE REFUSING GRAN T OF REGISTRATION U/S.12AA(3) OF THE INCOME TAX ACT. 2. FACTS OF THE CASE, IN BRIEF, ARE THAT THE ASSESS EE SOCIETY NAMELY INSTITUTE MANAGEMENT COMMITTEE OF INDUSTRIAL TRAINI NG INSTITUTE, DAHIWADI, TALUK MAN, DIST : SATARA APPLIED FOR REGI STRATION U/S.12A OF THE I.T.ACT, 1961. THE LD. CIT EXAMINED THE TRUST DEED, COPY OF REGISTRATION UNDER THE SOCIETIES REGISTRATION ACT, 1960, FINANCIAL STATEMENT FOR THE YEAR ENDING 31-03-2008, 2009 AND 2011 AND VARIOUS OTHER DOCUMENTS FILED. HE OBSERVED THAT THE MAIN O BJECTS OF THE SOCIETY AS REGISTERED WITH THE ASSISTANT REGISTRAR OF SOCIETIES, SATARA ON 25-05-2008 ARE AS UNDER : 2 (I) THE MAIN AIM OF THE SOCIETY IS TO ASSIST IN IMPROVE MENT OF STANDARD OF VOCATIONAL TRAINING AND SKILL DEVELOPMENT IN TH E MAHARASHTRA STATE AND COUNTRY AS A WHOLE; (II) THE SOCIETY HAS BEEN FORMED WITH THE SPECIFIC AIM OF UP- GRADATION OF THE INDUSTRIAL TRAINING CENTRE INTO A CENTRE OF EXCELLENCE IN SUCH A WAY THAT THE TRAINING PROVIDED IN T HE ITI IS IMPROVED AND BECOMES DEMAND DRIVEN LEADING TO BETTER EMPLOYABILITY & SELF EMPLOYMENT THE PASSING OUT GRA DUATES. (III) IN GENERAL THE SOCIETY SHALL FUNCTION ON NO PRO FIT NO LOSS' PRINCIPLE. HOWEVER ITS AFFAIRS SHALL BE MANAGED IN SUCH A WAY THAT IT BECOME SELF SUPPORTING IN DUE COURSE AND IS ABLE TO MEET ALL ITS EXPENSES AND LIABILITIES ON ITS OWN . 5.1 IN CLAUSE B(I) AND (II) OF THE MOA, THE OBJEC TS TO BE PURSUED BY THE SOCIETY HAVE BEEN FURTHER SPECIFIED AND ELABORATED AS UNDER : (I) TO MANAGE THE AFFAIRS OF ITI DAHIWADI TAL MAN DIS T-SATARA ACCORDING TO THE TERMS AND CONDITIONS SET OUT IN A MEMORANDUM OF AGREEMENT TO BE SIGNED AMONG THE CENTR AL GOVERNMENT, STATE GOVERNMENT AND INDUSTRY PARTNER. THE REPRESENTATIVE OF THE INDUSTRY PARTNER SHALL SIGN THI S MEMORANDUM OF AGREEMENT ON BEHALF OF THE SOCIETY CH AIRMAN (II) TO DEVELOP AN INSTITUTE DEVELOPMENT PLAN (IDP) FOR THE ITI, DAHIWADI, TAL MAN DIST :SATARA. THE IDP SHALL, INTERALIA, DEFINE LONG-TERM GOALS OF THE INSTITUTE, THE ISSUES AN D CHALLENGES FACING THE INSTITUTE AND THE STRATEGIES FO R DEALING WITH THEM. IT SHALL SET TARGETS FOR INSTITUTIONAL IMPROV EMENT, KEY PERFORMANCE INDICATORS, AND DETAIL THE INFRASTRUCT URAL & FINANCIAL REQUIREMENT WITH YEAR WISE BREAK UP TO MEET TH E NEEDS. 5.2 INCLUDING THE ABOVE, THERE ARE IN ALL XIX CLAUSES SPECIFYING THE AIMS AND MODE TO RUN THE SOCIETY, AS UNDER : (III) TO ASSESS EMERGING SKILL REQUIREMENTS IN THE RE GION AND SUGGEST CHANGES IN THE TRAINING COURSES BEING RUN IN THE ITI (IV) TO OBTAIN SHORT TERM, MEDIUM TERM AND LONG T ERM REQUIREMENT OF SKILLED WORKFORCE AND TAKE STEPS TO PRODUCE GRADUATES IN ITI ACCORDINGLY; (V) TO IDENTIFY SHORT-TERM TRAINING COURSE, WHICH CAN BE OFFERED IN THE ITI, DEVELOP INFRASTRUCTURE FOR THE SAME, ORGANIZE AND RUN THE COURSES AND CHARGE SUITABLE FEES FOR THE SAME. (VI) TO REVIEW TRAINING NEEDS OF INSTRUCTORS AND ADMINISTRATIVE/OFFICE STAFF OF THE ITI AND ARRANGE FOR THEI R TRAINING PROGRAMME. (VII) TO PLAN & ESTABLISH SUCH PRODUCTIONS/SERVICE CENTRES IN THE ITI WHICH HELP THE TRAINEES DEVELOP/LEARN THEIR SKILLS AND ALSO GENERATE FUNDS FOR THE SOCIETY TO BE USED IN THE TASK OF UP-GRADATION. (VIII) TO ADOPT INNOVATIVE MEASURES LIKE PROVIDING CONSULTANCY/ ADVISORY SERVICES TO THE INDUSTRY SO AS TO GENERATE REVENUE WHICH CAN BE UTILIZED FOR DEVELOPM ENT OF TRAINING ACTIVITIES IN THE ITI. (IX) TO APPOINT CONTRACT FACULTY AS PER NEED AND AS PER RULES AND REGULATIONS OF THE SOCIETY. 3 (X) TO ASSESS THE REQUIREMENT OF FUNDS FOR THE ITI AN D MAKE RECOMMENDATIONS TO THE STATE GOVERNMENT ON THE FUNDS PROVIDED BY IT TO THE ITI OUT OF ITS ANNUAL BUD GET. (XI) TO MAKE EXPENDITURE OUT OF THE FUNDS OF THE SOCIETY, INCLUDING INTEREST FREE LOAN RECEIVED FROM THE CENTRAL GOVERNMENT UNDER THE SCHEME 'UPGRADATION OF 1396 GOVERNMENT ITIS THROUGH PUBLIC PRIVATE PARTNERSHIP ' AS PER THE PRESCRIBED TERMS AND CONDITIONS. (XII) TO SET UP PLACEMENT CELL IN THE ITI TO GUI DE/HELP THE GRADUATES IN EMPLOYMENT/SELF-EMPLOYMENT. (XIII) TO NETWORK, INTERACT, ESTABLISH AND MAINTAIN WORKING RELATIONS WITH OTHER INSTITUTES WITHIN AND OUTSIDE VOCATI ONAL TRAINING SYSTEM AND PARTICIPATE IN RELATED ACTIVITIES SO AS T O INCREASE AWARENESS IN TRAINEES AND TRAINERS IN THE AREA OF VOCATIONAL TRAINING. (XIV) TO NETWORK AND INTERACT WITH LOCAL INDUSTRY CH AMBERS, OTHER INDUSTRY ASSOCIATIONS, EMPLOYMENT EXCHANGES, LEAD BANKS, OTHER GOVERNMENT DEPARTMENTS AND UNDERTAKE MEASURES, LIKE JOB FAIRS, SO AS TO INCREASE THE EMPLOY ABILIT Y OF ITI GRADUATES. (XV) TO UNDERTAKE MEASURES TO ACHIEVE TARGET KEY PERFORMANCE INDICATORS SET OUT IN THE TRIPARTITE MEMORANDUM OF AGREEMENT AS REFERRED IN THE' PART (I) AB OVE. (XVI) TO ORGANIZE SKILL COMPETITIONS IN THE ITI, TAKE PART IN OTHER SKILL COMPETITIONS INCLUDING STATE/NATIONAL/WO RLD SKILL COMPETITIONS. (XVII) TO UNDERTAKE PUBLICITY AND OTHER MEASURES, L IKE ORGANIZING SEMINARS IN SCHOOLS FOR POTENTIAL CANDIDATES FOR ITI, TO INCREASE AWARENESS ABOUT VOCATIONAL TRAINING AND ALSO TO CREATE A BETTER IMAGE OF VOCATIONAL TRAINING COURSE. (XVIII) TO PROMOTE MEASURES SO AS TO INCREASE TH E CAPACITY OF ITI BY ORGANIZING SECOND AND THIRD SHIFT IN THE ITI . (XIX) TO DETERMINE ADMISSIONS IN THE ITI TO THE EXTENT PROVIDED IN THE MEMORANDUM OF AGREEMENT REFERRED TO IN PARA 3B(I) ABOVE. 2.1 FROM THE ABOVE, HE OBSERVED THAT THE ASSESSEE T RUST IS ENGAGED IN UPGRADATION OF THE VOCATIONAL TRAINING PROVIDED BY THE ITI, DAHIWADI AND NOT IN THE ACT OF PURSUING ACTUAL ACTI VITY OF IMPARTING EDUCATION BY NORMAL SCHOOLING. HE, THEREFORE, HELD THAT THE ACTIVITIES OF THE ASSESSEE SOCIETY ARE NOT CHARITABLE WITHIN T HE MEANING OF SECTION 2(15) OF THE ACT. RELYING ON THE DECISION OF HONB LE SUPREME COURT IN THE CASE OF SOLE TRUSTEE LOKA SHIKSHANA TRUST R EPORTED IN 101 ITR 234 AND THE DECISION OF HONBLE PATNA HIGH COURT IN THE CASE OF BIHAR 4 INSTITUTE OF MINING AND MINE SURVEYING VS. CIT REPO RTED IN 208 ITR 608 HE REJECTED THE APPLICATION OF THE ASSESSEE SOC IETY SEEKING REGISTRATION U/S.12A(A) OF THE ACT. AGGRIEVED WITH SUCH ORDER OF THE CIT THE ASSESSEE IS IN APPEAL BEFORE US WITH THE FO LLOWING GROUNDS: 1. THAT THE LEARNED COMMISSIONER OF INCOME TAX III, PU NE IS NOT JUSTIFIED IN REJECTING THE APPLICATION OF THE APPEL LANT FOR THE GRANT OF REGISTRATION U/S. 12AA OF INCOME TAX ACT, 1961 AS THE APPELLANT TRUST DULY FULFILS ALL THE NECESSARY COND ITIONS FOR REGISTRATION UNDER SECTION 12A OF INCOME TAX ACT, 1 961. 2. THAT THE LEARNED COMMISSIONER OF INCOME TAX III, PU NE HAS ERRED BY TREATING THE SOCIETY AS NOT ENGAGED IN IMP ARTING EDUCATION BY NATIONAL SCHOOLING, HENCE NOT CHARIT ABLE WITHIN THE MEANING OF SECTION 2(15) OF THE INCOME TAX ACT, 1961 AND THEREBY REJECTING THE APPLICATION UNDER SECTION 12A . 3. WITHOUT PREJUDICIAL TO ABOVE, THE LEARNED COMMISSIO NER OF INCOME TAX III, PUNE HAS FAILED TO APPRECIATE THAT THE SOCIETYS OBJECT ARE COVERED WITHIN THE MEANING OF CHARITABLE PURPOSE UNDER SECTION 2(15) UNDER THE ADVANCEMENT OF ANY OT HER OBJECT OF GENERAL PUBLIC UTILITY. 3. THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE LD. CIT IS NOT JUSTIFIED IN REJECTING THE APPLICATION OF THE A SSESSEE FOR GRANT OF REGISTRATION U/S.12AA OF THE ACT AS THE ASSESSEE TR UST DULY FULFILS ALL THE NECESSARY CONDITIONS FOR REGISTRATION U/S.12AA OF THE I.T. ACT. HE SUBMITTED THAT THE LD.CIT WAS NOT JUSTIFIED IN TREA TING THE SOCIETY AS NOT ENGAGED IN IMPARTING EDUCATION BY NORMAL SCHOO LING. HE FAILED TO APPRECIATE THAT THE OBJECTS OF THE SOCIETY ARE C OVERED WITHIN THE MEANING OF CHARITABLE PURPOSES U/S.2(15) UNDER THE ADVANCEMENT OF ANY OTHER OBJECT OF GENERAL PUBLIC UTILITY. HE SUB MITTED THAT THE FOLLOWING INSTITUTES HAVE BEEN GRANTED REGISTRATION U/S.12AA OF THE I.T. ACT BY THE CIT-I, KOLHAPUR AS PER ORDERS DATED 31-08-2012, 02- 11-2010, 23-01-2012 AND 29-11-2011 RESPECTIVELY : 5 INSTITUTE OF MANAGEMENT COMMITTEE OF ITI, MURGUD INSTITUTE OF MANAGEMENT COMMITTEE OF ITI, SHIRALA INSTITUTE OF MANAGEMENT COMMITTEE OF ITI, SHAHUWADI INSTITUTE OF MANAGEMENT COMMITTEE OF ITI, GARGOTI 3.1 THE LD. COUNSEL FOR THE ASSESSEE BROUGHT TO THE NOTICE OF THE BENCH THE DECISION OF THE TRIBUNAL IN THE CASE OF I NSTITUTE MANAGEMENT COMMITTEE OF ITI, HATKANGALE AND INSTITU TE MANAGEMENT COMMITTEE OF ITI, PUNE VIDE ITA NO.1210/PN/2012 AND ITA NOS. 2102/PN/2012 AND ITA NO.92/PN/2012 ORDER DATED 19-0 9-2013 AND SUBMITTED THAT THE TRIBUNAL IN THE SAID DECISION HA S RESTORED THE REGISTRATION U/S.12AA WHEREIN THE CIT HAD CANCELLED THE REGISTRATION GRANTED EARLIER HOLDING THAT THE OBJECT OF THE ASSE SSEE IS UPGRADATION OF VOCATIONAL TRAINING PROVIDED BY THE ITI AND THE SAM E IS NOT AN ACTIVITY OF IMPARTING EDUCATION AND HENCE IT IS NOT A CHARIT ABLE PURPOSE WITHIN THE MEANING OF SECTION 2(15) OF THE ACT. HE ACCOR DINGLY SUBMITTED THAT THIS BEING A COVERED MATTER THE ORDER OF THE C IT BE SET-ASIDE AND THE ORDER BE GRANTED REGISTRATION U/S.12AA OF THE A CT. 4. THE LD. DEPARTMENTAL REPRESENTATIVE ON THE OTHER HAND HEAVILY RELIED ON THE ORDER OF THE CIT. 5. WE HAVE CONSIDERED THE RIVAL ARGUMENTS MADE BY B OTH THE SIDES, PERUSED THE ORDER OF THE LD. CIT DENYING REGISTRATI ON U/S.12AA AND THE PAPER BOOK FILED ON BEHALF OF THE ASSESSEE. WE HAVE ALSO CONSIDERED THE VARIOUS DECISIONS RELIED ON BY BOTH THE SIDES. WE FIND SIMILAR INSTITUTES OF MANAGEMENT COMMITTEE, I.E. IN STITUTE OF MANAGEMENT COMMITTEE OF ITI, MURGUD, INSTITUTE OF M ANAGEMENT COMMITTEE OF ITI, SHIRALA. INSTITUTE OF MANAGEMENT COMMITTEE OF ITI, SHAHUWADI AND INSTITUTE OF MANAGEMENT COMMITTEE OF ITI, GARGOTI 6 HAVE BEEN GRANTED REGISTRATION U/S.12AA OF THE ACT BY THE CIT-I, KOLHAPUR AS PER ORDERS DATED 31-08-2012, 02-11-2010 , 23-01-2012 AND 29-11-2011 RESPECTIVELY AS SUBMITTED BY THE LD. COUNSEL FOR THE ASSESSEE AND NOT CONTROVERTED BY THE REVENUE. THE ABOVE FACT ALSO FINDS MENTION IN THE ORDER OF THE TRIBUNAL IN THE C ASE OF INSTITUTE MANAGEMENT COMMITTEE OF ITI, HATKANGALE AND INSTITU TE MANAGEMENT COMMITTEE OF ITI, PUNE IN THE ORDER DATED 19-09-201 2 (CITED SUPRA). WE, THEREFORE, FIND NO REASON WHY THE SOCIETY ENGAG ED IN SIMILAR ACTIVITIES SHOULD BE TREATED DIFFERENTLY. WE FURTH ER FIND THE CIT-II, KOLHAPUR IN THE CASE OF INSTITUTE OF MANAGEMENT CO MMITTEE OF ITI, HATKANGALE AND INSTITUTE OF MANAGEMENT COMMITTEE OF ITI, PUNE HAD CANCELLED THE REGISTRATION EARLIER HOLDING THAT THE ASSESSEE TRUST IS ENGAGED IN UPGRADATION OF VOCATIONAL TRAINING PROVI DED BY THE ITI DOES NOT FALL WITHIN THE MEANING OF IMPARTING EDUCA TION AND THUS IT IS NOT ENGAGED IN ANY CHARITABLE PURPOSE WITHIN THE ME ANING OF SECTION 2(15) OF THE ACT. WE FIND THE TRIBUNAL AFTER ELABO RATELY DISCUSSING THE ISSUE HAD SET-ASIDE THE ORDER OF THE CIT AND HAS R ESTORED THE REGISTRATION GRANTED EARLIER TO THE ASSESSEE SOCIET IES U/S.12AA OF THE ACT BY HOLDING AS UNDER : 6. AFTER ITS INCORPORATION ON 16.10.2009, THE AP PELLANT SOCIETY APPROACHED THE COMMISSIONER FOR GRANT OF REGISTRATION UNDER SECTION 12AA OF THE ACT WHICH WAS GRANTED ON 08.03.2011 UNDE R CERTIFICATE NO. 34/19/2010-11 BY THE COMMISSIONER. SUBSEQUENTLY BY WAY OF THE IMPUGNED ORDER, THE COMMISSIONER HAS INVOKED HIS POWER UNDER SECTION 12AA(3) OF THE ACT AND CANCELLED THE REGISTR ATION ORIGINALLY GRANTED UNDER SECTION 12AA OF THE ACT ON 08.03.2011 . THE POINT MADE OUT BY THE COMMISSIONER TO JUSTIFY THE CANCELLATION OF REGISTRATION IS THAT THE OBJECT OF THE ASSESSEE IS UPGRADATION OF VOCATI ONAL TRAINING PROVIDED BY THE ITI, HATKANGALE AND THE SAME IS NOT A N ACTIVITY OF IMPARTING EDUCATION AND HENCE IT IS NOT A CHARITABL E PURPOSE WITHIN THE MEANING OF SECTION 2(15) OF THE ACT. IN COMING TO THE CONCLUSION THAT THE OBJECT OF THE ASSESSEE WAS NOT A CHARITABLE PU RPOSE WITHIN THE MEANING OF SECTION 2(15) OF THE ACT, THE COMMISSI ONER HAS RELIED UPON THE JUDGEMENT OF THE HONBLE PATNA HIGH COURT IN THE CASE OF BIHAR INSTITUTE OF MINING AND MINE SURVEYING VS. CIT, 208 ITR 608 7 (PATNA). AGAINST THE AFORESAID DECISION OF THE COMMISSIO NER, ASSESSEE IS IN APPEAL BEFORE US. 7. BEFORE US, THE LEARNED COUNSEL FOR THE ASSESSEE HAS ASSAI LED THE IMPUGNED ORDER OF THE COMMISSIONER ON VARIED GROUNDS. FIRSTLY, IT IS SOUGHT TO BE CONTENDED THAT THE SIMILAR IMCS NAMELY, I NSTITUTE OF MANAGEMENT COMMITTEE OF ITI, MURGUD, INSTITUTE OF MA NAGEMENT COMMITTEE OF ITI, SHIRALA AND INSTITUTE OF MANAGEMEN T COMMITTEE OF ITI, SHAHUWADI HAVE BEEN GRANTED REGISTRATION UNDER SECTION 12AA OF THE ACT BY THE COMMISSIONER OF INCOME TAX-I, KOLHAPUR VIDE ORDERS DATED 30.08.2012, 02.11.2010 AND 23.01.2012 RESPECTI VELY, WHICH CONTINUE TO HOLD THE FIELD AND THEREFORE, THE IMPUG NED CANCELLATION OF REGISTRATION OF A SIMILARLY PLACED ASSESSEE IS NOT JUSTIFIE D AND IS AGAINST THE PRINCIPLES OF CONSISTENCY. SECONDLY, IT IS SOUGHT TO BE MADE OUT THAT THE RELIANCE BY THE COMMISSIONER ON THE JUDGEMENT OF THE HONBLE PATNA HIGH COURT IN THE CASE OF BIHAR INSTITUTE OF MI NING AND MINE SURVEYING (SUPRA) FOR CANCELLING THE REGISTRATION IS U NJUSTIFIED INASMUCH AS THE RATIO OF THE SAID JUDGEMENT IS IN-APPLI CABLE TO THE FACTS OF THE PRESENT CASE. IT IS SOUGHT TO BE MADE OUT THAT IN THE CASE BEFORE THE HONBLE PATNA HIGH COURT, THE ASSESSEE WAS RU NNING A PRIVATE COACHING INSTITUTE FOR THE PURPOSE OF IMPARTI NG COACHING/TRAINING TO THE STUDENTS TO APPEAR IN SOME SPE CIFIED EXAMINATIONS AND THEREFORE IT WAS HELD TO BE AN ACTIV ITY NOT FALLING WITHIN THE EXPRESSION EDUCATION FOR THE PURPOSES OF S ECTION 2(15) OF THE ACT. IN THE PRESENT CASE, IT IS SOUGHT TO BE CONTEN DED THAT THE ACTIVITY OF THE ASSESSEE-SOCIETY IS PRIMARILY TO MANAGE T HE AFFAIRS OF THE ITI, HATKANGALE WITH THE AIM OF UPGRADATION OF VOCA TIONAL TRAINING SECTOR AS ENVISAGED IN THE SCHEME FORMULATED BY THE CEN TRAL GOVERNMENT. THE ITI IS ENGAGED IN PROVIDING OF VOCA TIONAL EDUCATION AND TRAINING TO THE STUDENTS. IT WAS THEREFORE CONTEN DED THAT THE COMMISSIONER HAS MISDIRECTED HERSELF IN APPLYING THE RAT IO OF THE JUDGEMENT OF THE HONBLE PATNA HIGH COURT IN THE CA SE OF BIHAR INSTITUTE OF MINING AND MINE SURVEYING (SUPRA) WHICH IS RENDERED UNDER DIFFERENT FACTS AND CIRCUMSTANCES. 8. APART FROM THE AFORESAID POINTS, A PERTINENT POINT WHICH ARISES IS WITH REGARD TO THE SCOPE AND AMBIT OF SECTION 12A A(3) OF THE ACT WHICH HAS BEEN INVOKED BY THE COMMISSIONER IN ORDER TO CANCEL THE REGISTRATION. SECTION 12AA(3) OF THE ACT READS AS UNDE R :- [(3) WHERE A TRUST OR AN INSTITUTION HAS BEEN GRAN TED REGISTRATION UNDER CLAUSE (B) OF SUB-SECTION (1) [O R HAS OBTAINED REGISTRATION AT ANY TIME UNDER SECTION 12A [AS IT S TOOD BEFORE ITS AMENDMENT BY THE FINANCE (NO.2) ACT, 1996 (33 OF 19 96)]] AND SUBSEQUENTLY THE COMMISSIONER IS SATISFIED THAT THE ACTIVITIES OF SUCH TRUST OR INSTITUTION ARE NOT GENUINE OR ARE NO T BEING CARRIED OUT IN ACCORDANCE WITH THE OBJECTS OF THE TRUST OR INSTITUTION, AS THE CASE MAY BE, HE SHALL PASS AN ORDER IN WRITING CANCELLING THE REGISTRATION OF SUCH TRUST OR INSTITUTION: PROVIDED THAT NO ORDER UNDER THIS SUB-SECTION SHALL BE PASS ED UNLESS SUCH TRUST OR INSTITUTION HAS BEEN GIVEN A REASONAB LE OPPORTUNITY OF BEING HEARD.] 9. OSTENSIBLY, SECTION 12AA(3) OF THE ACT EMPOWERS TH E COMMISSIONER TO CANCEL THE REGISTRATION ALREADY GRANTE D BUT SUCH POWER IS CIRCUMSCRIBED BY THE REQUIREMENT OF RECORDIN G A SATISFACTION IN WRITING TO THE EFFECT THAT THE ACTIVITIES OF SUCH TRUST OR INSTITUTION ARE NOT THE GENUINE, OR TO THAT THEY ARE NOT BEING CARRIED OUT IN ACCORDANCE WITH THE OBJECT OF THE TRUST AND INSTITUTI ON, AS THE CASE MAY BE. QUITE CLEARLY, THE PHRASEOLOGY OF SUB-SECTION (3) OF SECTION 12AA OF 8 THE ACT DOES NOT GIVE THE COMMISSIONER A BLANKET POWER TO CANCEL THE REGISTRATION BUT THE CANCELLATION IS TO BE EFFECTED O N FULFILLMENT OF TWO CONDITIONS, NAMELY (I) THAT THE ACTIVITIES OF THE TRUST OR INSTITUTION ARE NOT GENUINE; AND/OR (II) THAT THE ACTIVITIES ARE NOT BEING CARRIED OUT IN ACCORDANCE WITH THE OBJECT OF THE TRUST OR IN STITUTION, AS THE CASE MAY BE. IN THE LIGHT OF SUCH LEGAL POSITION, NOW WE MAY EXAMINE AS TO WHETHER THE OBJECTION RAISED BY THE COMMISSIONER IN T HE IMPUGNED ORDER FALLS WITHIN THE AMBIT OF SECTION 12AA(3) OF T HE ACT SO AS TO EMPOWER HIM TO CANCEL THE REGISTRATION GRANTED TO TH E ASSESSEE UNDER SECTION 12AA OF THE ACT ON 08.03.2011. 10. CLEARLY, THE SOLITARY POINT MADE OUT BY THE COMM ISSIONER IS THAT THE OBJECT OF THE ASSESSEE I.E. TO ENGAGE IN UPGRA DATION OF VOCATIONAL TRAINING PROVIDED BY THE ITI, HATKANGALE DOES NOT FALL WITHIN THE MEANING OF EXPRESSION EDUCATION AND THUS IT IS NOT ENGAGED IN ANY CHARITABLE PURPOSE WITHIN THE MEANI NG OF SECTION 2(15) OF THE ACT. QUITE CLEARLY, THE IMPUGNED ORDER OF THE COMMISSIONER IS SILENT WITH REGARD TO TWO CONDITIONS PRE SCRIBED IN SECTION 12AA(3) OF THE ACT SO AS TO JUSTIFY THE CANCE LLATION OF REGISTRATION. EVEN AT THE TIME OF HEARING OF APPEAL BEFORE US, NO CASE HAS BEEN MADE OUT AS TO IN WHAT MANNER THE CONDITIONS SPECIFIED IN SECTION 12AA(3) OF THE ACT ARE SATISFIED IN THE PRESEN T CASE, ESPECIALLY WHEN IN THE CASE OF THREE SIMILARLY PLACED INSTITUTIO NS CITED ABOVE, THE REGISTRATIONS GRANTED UNDER SECTION 12AA OF THE ACT C ONTINUE TO HOLD THE FIELD. 11. BEFORE PROCEEDING FURTHER WE MAY POINT OUT THAT THE ENQUIRY AS TO WHETHER THE OBJECTS OF A TRUST OR OTHER INSTITUTIO N FALL WITHIN THE SCOPE OF CHARITABLE PURPOSE UNDER SECTION 2(15) OF THE ACT IS ENVISAGED ONLY AT THE TIME OF GRANT OF REGISTRATION U NDER SECTION 12AA(1) OF THE ACT BUT THE REVIEW OF THE SAME IS NOT PERMISSIBLE IN VIEW OF THE PHRASEOLOGY OF SECTION 12AA(3) OF THE AC T, WHICH EMPOWERS THE COMMISSIONER TO CANCEL THE REGISTRATION, B ECAUSE CANCELLATION HAS TO BE EFFECTED ONLY ON FULFILLMENT OF THE CONDITIONS PRESCRIBED IN SECTION 12AA(3) OF THE ACT, WHICH HAVE ALREADY BEEN OBSERVED BY US IN THE EARLIER PARAGRAPHS. HAVING CONSID ERED THE IMPUGNED ORDER, WE DO NOT FIND THAT THE COMMISSIONER HAS ESTABLISHED THE FULFILLMENT OF CONDITIONS CONTAINED IN SECTION 12AA(3) OF THE ACT. THEREFORE, THE IMPUGNED ORDER OF THE CO MMISSIONER IS UNTENABLE AND IS LIABLE TO BE SET-ASIDE. MOREOVER, IT IS ALSO NOT DISPUTED THAT SIMILARLY PLACED INSTITUTIONS, AS POINTED OUT BY THE LEARNED COUNSEL, CONTINUE TO ENJOY THE REGISTRATION U NDER SECTION 12AA OF THE ACT AND ON THE PRINCIPLE OF CONSISTENCY A LSO THE IMPUGNED ORDER OF THE COMMISSIONER IS UNTENABLE. 12. CONSIDERED IN THE AFORESAID LIGHT, WE ARE SATISFIED THAT THE PRE- CONDITIONS PRESCRIBED IN SECTION 12AA(3) OF THE ACT H AVE NOT BEEN ESTABLISHED AND THEREFORE THE COMMISSIONER EXCEEDED HER JURISDICTION IN CANCELLING THE REGISTRATION GRANTED TO THE ASSESSEE U NDER SECTION 12AA OF THE ACT ON 08.03.2011. ACCORDINGLY, THE IMP UGNED ORDER OF THE COMMISSIONER IS SET-ASIDE AND REGISTRATION GRANTED TO THE ASSESSEE UNDER SECTION 12AA OF THE ACT DATED 08.03.2011 IS HE REBY RESTORED. 13. SIMILARLY, THE REGISTRATIONS GRANTED TO THE OTHER TWO ASSESSEES ARE ALSO RESTORED AS THE FACTS AND CIRCUMSTANCES ARE IDEN TICAL. 6. IN VIEW OF THE ABOVE DISCUSSION AND FOLLOWING TH E DECISION OF THE CO-ORDINATE BENCH OF THE TRIBUNAL CITED SUPRA, WE HOLD THAT THE 9 APPELLANT SOCIETY IS ENTITLED TO REGISTRATION U/S. 12A OF THE I.T. ACT. WE ACCORDINGLY SET ASIDE THE ORDER OF THE LD. CIT A ND DIRECT HIM TO GRANT REGISTRATION TO THE ASSESSEE TRUST U/S. 12A O F THE I.T. ACT. WE HOLD AND DIRECT ACCORDINGLY THE GROUNDS RAISED BY T HE ASSESSEE ARE ACCORDINGLY ALLOWED. 7. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. PRONOUNCED IN THE OPEN COURT ON 13-12-2013. SD/- SD/- (R.S. PADVEKAR) (R.K. PANDA) JUDICIAL MEMBER ACCOUNTANT MEMBER PUNE, DATED : 13 TH DECEMBER, 2013 SATISH COPY OF THE ORDER IS FORWARDED TO : 1. THE ASSESSEE 2. THE DEPARTMENT 3. THE CIT-III, PUNE 4. D.R. B BENCH, PUNE 5. GUARD FILE //TRUE COPY// BY ORDER SENIOR PRIVATE SECRETARY, INCOME TAX APPELLATE TRIBUNAL, PUNE