MRS. K. K. USHA, J.

The appellant is a charitable society registered under the Travancore Cochin Literary Scientific and Charitable Societies Registration Act, 1955. The society made an application for registration under s. 12A of the IT Act, 1961, before the respondent under Ext. P3 letter dated 14th July, 1998, accompanied by Ext. P4 prescribed form. The application was rejected by the respondent under Ext. P5 order. The society filed Original Petition seeking to quash Ext. P5. Writ of mandamus was also sought for a direction to the respondent to register the society under s. 12AA of the IT Act, 1961. The learned Single Judge who heard the original petition disposed of the same with the following direction :

"2. In the circumstances of the case and in view of the contentions raised by the petitioner that after the first year when they generated income they are doing charitable work and on the submission of the standing counsel that they will consider the matter if fresh application is filed. I direct the CIT to consider the matter afresh, if petitioner files a fresh application, according to law untrammelled by any of the observations made in Ext. P5."

Aggrieved by the above, the petitioner-society has come up in appeal.

The main contention raised by the learned counsel for the appellant was that in order to grant registration under s. 12AA the respondent should not have insisted that the society has done charitable work during the first year of its operation itself. It was further contended that there is violation of principles of natural justice in rejecting petitioner's application on the basis of the enquiry report submitted by the assessing authority about the activities carried on by the society vide his letter dated 22nd December, 1998.On a reading of Ext. P5 it can be seen that an opportunity of being heard was granted to the petitioner-society through its general secretary. We do not find any contention taken in the original petition that contents of the report submitted by the assessing authority was not disclosed to the representative of the society at the time of hearing and, therefore, there is violation of principles of natural justice. The learned counsel for the Department would submit that, as a matter of fact, the secretary of the society was made known the contents of the report. Even otherwise we find the factual position reported by the assessing authority that on 22nd December, 1998, regarding the activities of the society is not under challenge before this Court. The contention raised is only that in future the society proposes to carry on activities in charitable nature in conformity of its object. The decision to start a technical educational institution at Kottayam itself was taken only on 14th June, 1999. Therefore, we find no merit in the contention that the order is vitiated for having been issued in violation of principles of natural justice.

Sec. 12AA which was inserted by the Finance (No. 2) Act, 1996, w.e.f. 1st April, 1997, reads as follows :

"12AA (1) The Chief CIT or CIT, on receipt of an application for registration of a trust or institution made under cl. (a) of s. 12A , shall :

(a) call for such documents or information from the trust or institution as he thinks necessary in order to satisfy himself about the genuineness of activities of the trust or institution and may also make such inquiries as he may deem necessary in this behalf; and

(b) after satisfying himself about the objects of the trust or institution and the genuineness of its activities, he :(i) shall pass an order in writing registering the trust or institution;

(ii) shall, if he is not so satisfied, pass an order in writing refusing to register the trust or institution, and a copy of such order shall be sent to the applicant."

The inclusion of the above provision was proposed to provide for a procedure to be followed for grant of registration to a trust or institution. Earlier, there was no provision in the Act for proc