CIT (EXEMPTIONS) Vs. KANAKIA ART FOUNDATION

JUDGEMENT

(1.) Revenue has filed this appeal to challenge the judgment of the Income Tax Appellate Tribunal ("the Tribunal"? for short). Following question is presented for our consideration:-

(2.) Respondent assessee is a trust. The assessee desired to obtain registration as a Charitable Trust under Section 12A of the Income Tax Act, 1961 ("the Act"? for short). Said application came to be rejected by the Commissioner by order dated 21.12.2012. He referred to some of the objects of the trust to hold that these objects were not in the nature of charitable purposes. He also recorded that the trust deed gave full discretion to the trustees to utilize the income of the trust for any of the objects. In his opinion, therefore, the trustees could as well have utilized the income of the trust for non-charitable purposes. He, therefore, refused to grant the registration.

(3.) The assessee carried the matter in appeal. The Tribunal by the impugned judgment allowed the appeal holding that none of the objects of the trust were in the nature of charitable purposes. If the trust was not following the objects of the trust, it is always open for the Assessing Officer to examine the same while granting exemption under Section 11 of the Act.