February 2013
Charitable trust: Registration: S/s 12A and 12AA: Statute does not prohibit or enjoin the CIT from registering trust solely based on its objects, without any activity, in the case of a newly registered trust:
By K. B. Bhujle, Advocate
fiogf49gjkf0d
DI vs. Foundation of Opthalmic and Optometry Research Education Centre; 254 CTR 133 (Del):
The assessee society had applied for registration u/s. 12AA on 10-7-2008. The Director of IT(Exemption) refused to grant registration on the ground that no charitable activity had in fact taken place since the society was a newly established one. The Tribunal allowed the assesse’s appeal.
On appeal by the Revenue, the Delhi High Court upheld the decision of the Tribunal and held as under:
“i) Facially, the provisions of section 12AA would suggest that there are no restrictions of the kind which the Revenue is reading into this case. In other words, the statute does not prohibit or enjoin the CIT from registering trust solely based on its objects, without any activity, in the case of a newly registered trust. The statute does not prescribe a waiting period, for a trust to qualify itself for registration.
ii) Tribunal was right in holding that while examining the application u/s. 12AA(1)(b) r.w.s. 12A, the concerned CIT/Director is not required to examine the question whether the trust has actually commenced and has, in fact, carried on charitable activities.
iii) The appeal is accordingly dismissed.”
