The Income-Tax Act does not provide for deemed registration of trusts if the application is not decided within six months, as confirmed by the Supreme Court.

JUDGMENT :

(G.S. Kulkarni, J.)

1. This appeal under Section 260 of the Income-Tax Act, 1961 (for short “I.T. Act”) filed by the revenue is directed against an order dated 28 March, 2008 passed by the Income-tax Appellate Tribunal, Pune Bench (for short “Tribunal”) whereby the respondent/assessee’s appeal arising from an order dated 15 September, 2006 passed by the Commissioner of Income-tax-IV, Pune (for short (“CIT)) under Section 12AA read with Section 12A of the I.T. Act has been allowed. By the impugned order, the Tribunal has held that as the CIT did not pass an order granting or refusing registration of the assessee under Section 12A(1) within a period of six months as prescribed under Section 12AA(2) of the I.T. Act, the assessee is deemed to have been granted a registration. The Tribunal accordingly held that the order of CIT refusing registration was a nullity requiring it to be quashed and set aside. The assessment year in question is A.Y. 2005-06.

2. By an order dated 6 June, 2011, the present appeal came to be admitted on the following question of law:

“Whether on the facts and in the circumstances of the case and in law, the ITAT is justified in granting the assessee a deemed registration under section 12AA of I.T. Act, 1961, when there is no such specific deeming provision in the I.T. Act, 1961.”

3. The relevant facts are required to be noted. The assessee is a public trust running a pediatric hospital at Pune. On 6 February, 2006, the assessee filed an application in Form No. 10A requesting registration of the assessee under Section 12A of the I.T. Act. On such application of the assessee, the CIT-IV, Pune passed an order under Section 12AA on 15 September, 2006 refusing registration to the assessee. Being aggrieved by the said order, the assessee preferred an appeal before the Tribunal. The Tribunal by an impugned order has allowed the appeal referring to an earlier decision of the Tribunal in the case of Bhagwad Swarup Shri Shri Devraha Baba Memorial Shri Hari Parmarth Dham Trust [2007] 17 SOT 281(SB)(Del.). The premise on which the Tribunal allowed the assessee’s appeal is considering that the date of assessee’s application seeking registration under Section 12A was 6 February, 2006 and the decision on the same of its rejection was rendered on 15 September, 2006, which was beyond the prescribed period of six months as stipulated under Section 12AA(2). On such reasoning, the Tribunal directed the Commissioner to grant registration to the assessee with effect from 1 April, 2005, namely, first day of the Financial year in which the application was made, considering the provisions of Section 12A(a)(ii). The relevant observations of the Tribunal are required to be noted, which reads thus:

“3. On hearing the submissions of both the sides, we have noticed that the admitted position was that the requisite application on Form No. 10A seeking registration u/s. 12A was moved by the assessee on 6.2.2006, however, the impugned order passed u/s. 12AA was dated 15.09.2006. These dates are not in dispute as accepted by both the sides. The ld. Commissioner in the impugned order has declined to register the Trust as prescribed u/s. 12A of I.T. Act thereupon. Form No. 10A application was rejected. Since the dates are not in dispute, then the cause of grievance appears to be correct because admittedly, the registration application was moved in the month of February, 2006, thus according to Section 12AA(II), it should have been disposed of before the expiry of six months, i.e., August 2006, however, it was disposed of by an order dated 15.09.2006. This issue is squarely covered by the cited decision Bhagwad Swarup Shri Shri Devraha Baba Memorial Shri Hari Parmarth Dham Trust (supra) wherein held as under, reproduced head note:

“Section 12AA was introduced to provide for the procedure for registration, enquiry into the claim and a time-limit for passing the order. Therefore, while exercising such an important power, the Commissioner shou