Trust is involved in continuous violation of the provisions of the I.T Act, eg., not filing the returns in time, not paying the tax etc. and also because Trust deed has no provision to the effect that it is not for profit”, it was found that the Trust cannot be granted registration. On appeal, the Tribunal found that the reasons stated by the registering authority for refusal of registration are not relevant for the purpose of registration. It was held that the findings of the Commissioner of Income Tax, in so far as they relate to activities of the Trust, are germane and relevant. It was further held that the acceptance of amounts from prospective students towards tuition fee cannot by itself be a relevant ground, unless it is shown that what was collected was not tuition fees at all, but capitation fee. The factual aspect of the matter was directed to be ascertained with notice to the appellant. It was also held that the presence of profit by itself would not disentitle the Trust for registration under the Act, since “there is no question of exemption, if there is no scope of income”. The matter was thus remanded to the Commissioner of Income Tax to examine the assessee's case in its proper perspective after hearing the appellant as also considering the deed of modification of Trust executed on 18.06.2009.
