Director Of Income Tax (Exemptions)Chennai - 34 v. M/S.ravi Rajasimhan Charitable Trust9, Ii Cross Street, Elango Nagarvirugambakkamchennai 600 092

IN THE HIGH COURT OF JUDICATURE AT MADRAS CORAMTHE HONOURABLE MR. JUSTICE R.SUDHAKARANDTHE HONOURABLE MR. JUSTICE R.KARUPPIAH T.C.A. NO. 422 OF 2013 Director of Income Tax (Exemptions)Chennai - 34... Appellant - Vs - M/s.Ravi Rajasimhan Charitable Trust9, II Cross Street, Elango NagarVirugambakkamChennai 600 092. ... Respondent Appeal under Section 260A of the Income Tax Act against theorder dated 6.2.13 passed by the Income Tax Appellate Tribunal 'B'Bench, Chennai, made in I.T.A. No.19/Mds/2013. against the order of the Director of Income Tax (Exemptions)Aayakar Bhavan Annexe III Floor, No.121 M.G. Road, NungambakkamChennai- 600 034 in DIT (E) No.2 (158) /12-13 dated 26.11.2012.For Appellant: Mr. J.Narayanasamy Standing counsel for Income TaxFor Respondent : Mr. N.Devanathan JUDGMENT (DELIVERED BY R.SUDHAKAR, J.) This Tax Case (Appeal) is filed by the Revenue as against theorder of the Income Tax Appellate Tribunal raising the followingsubstantial question of law: "Whether on the facts and in the circumstances ofthe case, the Income Tax Appellate Tribunal was rightin holding that assessee is entitled for registrationunder Section 12AA?” 2. The issue involved in the present case is whether the truston its inception would be disentitled to the benefit of registrationunder Section 12AA of the Income Tax Act on the ground that theactivities of the Trust has just started. The Trust was created on2.4.12 only and they applied for registration on 28.5.12.https://hcservices.ecourts.gov.in/hcservices/ 3. Learned counsel appearing for the Revenue fairly submitsthat the issue involved in this appeal is covered by a decision ofthis Court in T.C.(A)No.579 of 2013 dated 27.01.2014, wherein thisCourt, following the decision of this Court reported in (2012) 206Taxman 69 (CIT – Vs - Arulmighu Sri Kamatchi Amman Trust), dismissedthe appeal filed by the Revenue holding that the Revenue would notbe justified in refusing the grant of registration at the threshold.For better clarity, the relevant portion of the decision of thisCourt reads as follows: 3. Learned counsel appearing for the Revenue fairly submitsthat the issue involved in this appeal is covered by a decision ofthis Court in T.C.(A)No.579 of 2013 dated 27.01.2014, wherein thisCourt, following the decision of this Court reported in (2012) 206Taxman 69 (CIT – Vs - Arulmighu Sri Kamatchi Amman Trust), dismissedthe appeal filed by the Revenue holding that the Revenue would notbe justified in refusing the grant of registration at the threshold.For better clarity, the relevant portion of the decision of thisCourt reads as follows: "9. In the present case also, the Revenue onlyquestions the trust not having commenced its activityfor the grant of registration. The provision underSection 12AA of the Income Tax Act does not stipulatesuch a condition for grant of registration. On theother hand, Section 12AA (1) contemplates satisfactionof the Commissioner about the objects of the Trust andthe genuineness of the activities and make suchenquiry as may be necessary for the purpose of grantof registration. In so considering the application,the Commissioner has to give an opportunity to theassessee as provided for under proviso to sub-section(1) of Section 12AA. Under sub-section (3) of Section12AA, the Commissioner is given power to cancel theregistration, if he satisfies that the objects of suchtrust are not genuine or not being carried on inaccordance with the objects of the trust. When suchan authority is vested with the Commissioner to cancelthe registration in the event of the trust not beingcarried on in accordance with the objects of thetrust, we do not find any ground to say that merely onthe date of the application, the assessee trust hadnot commenced its activities, hence, registrationcould not be granted. It is not denied by theassessee that on the date of the application underSection 12AA, it was yet to commence its operation.But nevertheless the genuineness of the objects of thetrust were not questioned by the Commissioner.Considering the fact that the continuance ofregistration is further a subject matter of scrutinyby the Commissioner as contemplated under Section 12AA(3) of the Income Tax Act, we do not think that theRevenue would be justified in refusing theregistration at the threshold. The Tribunal hadfollowed the decision of the Gujarat High Court in thecase of CIT V. Kutchi Dasa Oswal Moto Pariwar AmbamaTrust reported in 29 Taxman 228. We respectfullyagree with the decision of the Gujarat High Court." The abovesaid view has been consistently followed by thisCourt in a number of decisions, one of which being Director ofIncome Tax Exemptions – Vs – Seervi Samaj Tambaram Trust (362 ITR199 (Mad)). The above-said view was followed by this Court, in https://hcservices.ecourts.gov.in/hcservices/ which one of us was a party (R.Sudhakar, J.) in T.C. (A) No.261 of2014 dated 22.8.2014. 5. Accordingly, following the decision of this Court in T.C.(A) No.579 of 2013 dated 27.01.2014, and in view of the consistentview of this Court, this Tax Case (Appeal) stands dismissed. Thesubstantial question of law is answered against the Revenue.However, there shall be no order as to costs. Sd/- Asst.Registrar (J ) /true copy/ Sub Asst. RegistrarGLNTo1. Director of Income Tax (Exemptions)Aayakar BhavanAnnexe III Floor Chennai - 34.2. The Assistant Registrar Income Tax Appellate Tribunal 'B' Bench Sastri Bhavan Chennai.1 cc to Mr.J. Narayanaswamy, Advocate, SR. 24531 cc to Mr.N. Devanathan, Advocate Sr. 1655 T.C.A. NO. 422 OF 2013TEJ (CO)kk 12/2 https://hcservices.ecourts.gov.in/hcservices/