Director Of Income Tax ... vs Commerce Teachers Association
2011 Latest Caselaw 4639 Del

*      IN THE HIGH COURT OF DELHI AT NEW DELHI

%                     Decision Delivered on: 20th September, 2011

+      ITA NO.1099/2011



       DIRECTOR OF INCOME TAX (EXEMPTION) .....Appellant
                Through: Mr. Abhishek Maratha, Advocate



                                 -versus-



       COMMERCE TEACHERS ASSOCIATION                   .....Respondent
              Through: None.


       CORAM:
       HON'BLE MR. JUSTICE A.K. SIKRI
       HON'BLE MR. JUSTICE SIDDHARTH MRIDUL

      1.        Whether reporters of local papers may be allowed to see
                the Order?
      2.        To be referred to the Reporter or not?
      3.        Whether the Order should be reported in the Digest?

A.K. SIKRI, J. (ORAL)

1. The Respondent-Assessee is an Association of Commerce

Teachers which is registered as a Society under the Societies

Registration Act, 1860. The Assessee claimed itself to be a

Welfare Society whose objects are of charitable nature. As per

the Memorandum of Association it has 54 objects. The Society

applied for grant of registration under Section 12AA of the

Income Tax Act, 1961.

2. The Director of Income Tax(Exemption) analysed the

activities of the Assessee and was satisfied that the Assessee

was deserved to be granted registration under Section 12AA of

the Act. Accordingly, Order dated 28th September, 2010 was

issued by the Director of Income Tax(Exemption) granting such

a registration. However, certain conditions were imposed in the

said registration. The Respondent-Assessee did not call in

question any conditions except Condition No.11 which reads as

under:

"The society should not charge any fee/amount from the beneficiaries. Also shall not collect any fees on account of talent exam."

3. Challenging the imposition of the aforesaid condition as

unwarranted the Respondent-Assessee preferred Appeal before

the Income Tax Appellate Tribunal, which has been allowed by

the learned Tribunal holding that there was no purpose to

impose such a condition. It is inter alia recorded by the Tribunal

that there is no dispute that otherwise Respondent-Assessee

fulfills all the relevant conditions for claim of registration under

Section 12AA of the Act. Section 12AA of the Act nowhere

provides that the Director of Income Tax(Exemption) would

grant registration subject to imposition of stipulation as

enumerated at Serial No.11 of the certificate.

4. Learned Counsel for the Appellant argues that this Court

in the Digember Jain Society for Child Welfare vs. Director

General of Income Tax(Exemptions), (2010) 329 ITR 459, has

categorically held that while granting the exemption the

Director General is free to incorporate stipulations and

conditions in terms of the third proviso. On this basis it is

argued that the Tribunal is not right in holding that the

registration cannot be subject to conditions.

5. After reading the Order of the Tribunal we are of the

opinion that the Tribunal has nowhere said that conditions

cannot be imposed at all. The only dispute was about the nature

of Condition No.11 and entire observations of the Tribunal are

qua that condition holding it to be unwarranted. We are in

agreement with the view taken by the Tribunal. No question of

law arises. The Appeal is accordingly dismissed.

A.K. SIKRI, J.

SIDDHARTH MRIDUL, J.

SEPTEMBER 20, 2011 mk