Sec. 12AA Cancellation of Registration of society which collects huge fees although formed to run the dental college without any fees from students is justified

Bhim Rao Ambedkar Educational Society Vs. CIT (Exemption) (Allahabad High Court)

A categorical finding has been recorded that Society is not being run according to the objects, i.e., free health education and establishment of dental college without fee. He also pointed out that a Society if charging nominal fee to maintain its expenses etc., it may not have the effect of loosing its character of charitable trust but when specific object of Society is to establish and run a dental college without any charge and such a Society realize huge fee from students, it would be a case where Society is not running according to its objects and, therefore, section 12-AA(3) of Act, 1961 has rightly been applied by Commissioner-II in cancelling registration order.

FULL TEXT OF THE HIGH COURT JUDGMENT / ORDER IS AS FOLLOWS:-

Delivered by Honorable Sudhir Agarwal, J. under Chapter VII Rule 2 of Allahabad High Court Rules, 1952 )

This is Assessee’s appeal under section 260A of Income Tax Act, 1961 (hereinafter referred to as the “Act, 1961”) arising from judgment and order dated 31-3-2015 passed by Income Tax Appellate Tribunal, Lucknow (hereinafter referred to as the “Tribunal”) in ITA No. 548/LKW/2012 dismissing appeal and confirming order dated 3-9-2012 passed by Commissioner-II, Lucknow (hereinafter referred to as the “Commissioner-II”) cancelling registration granted under section 12AA(1)(b)(i) of Act, 1961 by exercising power under section 12AA(3) of Act, 1961.

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