Section 12AA, read with section 12A, of the Income-tax Act, 1961 - Charitable or religious trust - Registration procedure

Court :
IN THE ITAT NEW DELHI BENCH ‘B’ (Special Bench)

Brief :
Section 12AA, read with section 12A, of the Income-tax Act, 1961 - Charitable or religious trust - Registration procedure - Whether it is mandatory for Commissioner to dispose of application for registration under section 12A within six months from end of month in which application was filed - Held, yes - Whether in a case where Commissioner does not pass order, granting or refusing registration of trust within period laid down in section 12AA(2) (i.e., within period of six months from end of month in which application for registration under section 12A was filed) then registration would be deemed to have been granted to Trust or Institution automatically on expiry of period specified in section 12AA(2) - Held, yes CIRCULARS AND NOTIFICATIONS Circular No. 762, dated 18-2-1998 FACTS The assessee, a charitable trust/institution, applied to the Commissioner for registration under section 12A on 23-10-2001. The Commissioner, however, passed the order under section 12AA refusing registration to the assessee-trust on 26-5-2003 which was beyond the period laid down in section 12AA(2) (i.e., not within the period of six months from the end of the month in which the application for registration was filed). He had, however, initiated certain enquiries by letter dated 3-4-2002, which was well within the period of six months, to which the assessee responded by furnishing the relevant details. The enquiry continued well beyond 30-4-2002. But, finally order was passed under section 12AA refusing registration on 26-5-2003. Aggrieved by the said order the assessee filed the instant appeal before the Tribunal and contended that once the time-limit fixed by section 12AA(2) expired without the Commissioner having passed any order, it must be deemed that the registration had been granted. However, since a contrary view had been expressed by two co-ordinate Benches of the Tribunal, on said issue the matter was referred to the Special Bench, for decision.

Citation :
Bhagwad Swarup Shri Shri Devraha Baba Memorial Shri Hari Parmarth Dham Trust v Commissioner of Income-tax, Dehradun