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9. Hence, Ground Nos.-1, 2, 4, 6, 7, 9 to 16 are dismissed as not pressed by the assessee.

GROUND NO-3

10. Apropos Ground No-3 the counsel of the assessee submitted that once the assessee charitable trust has been granted registration under Section 12A of the Act by following procedure for registration under Section 12AA of the Act then the Assessing Officer has no right to change the status of the assessee from charitable trust to association of persons (AOP) until and unless an order is passed in writing by the appropriate authority cancelling the registration of such trust and institution. He further submitted that the CIT (A) upheld the action of the AO in this regard on the mis interpretation of the statutory provisions of the Act. Replying to the above submissions the departmental representative submitted that it was the duty of the assessee during the assessment proceedings to show that the assessee trust carried out charitable activities during the year under consideration as per charitable objects of the trust but the assessee could not substantiate the fact that the trust carried out charitable activities during the year under consideration. Therefore, the Assessing Officer rightly assessed the income of the assessee as an AOP instead of a charitable trust.

15. On careful and thoughtful considerations of above rival submissions of both the parties, at the outset we observed that neither the Assessing Officer nor the CIT(A) has either noted or observed any fact that the receipts of the assessee trust were misappropriated, misused or used contrary to the charitable objects of the assessee trust as stipulated in the trust deed. We also observed that the authorities below have not made any allegation that the assessee trust had carried out any activities contrary to its object and misusing the funds of the assessee trust. From the orders of the authorities below, we observe that the Assessing Officer disallowed the claim of expenses amounting to Rs.2, 59,763/- with an observation that no evidence has been filed during the assessment proceeding regarding said charitable activities of the trust. Therefore, the Ld. AO had held that when there were no charitable activities then the benefit of Provisions of Section 11&12 of the Act was not available to the assessee and the Assessing Officer completed the assessment in the status of the assessee trust as AOP instead of a charitable trust.

17. In view of the above factual matrix we are inclined to hold that as per provisions of the Act this is not a pre-condition for conducting a charitable activity that the persons or institutions towards which the assessee charitable trust is providing donation and conducting charitable activity should be registered under Section 12A of the Act coupled with entitlement to enjoy benefits of Section 80G of the Act. The Assessing Officer and CIT (A) should have examine the claim of the assessee pertaining expenses and donations towards charitable activities in the light of evidence and material submitted before them with a view that whether the expenses and donations claimed by the assessee were for the charitable purpose and in consonance with the objects and permissible charitable activities of the trust as per trust deed.

19. Apropos ground no-1 sole ground of the revenue we have heard rival argument of both the parties and carefully perused the record. The Departmental Representative (DR) submitted that the CIT (A) has erred in ignoring the fact that the registration under Section 12A of the Act granted by DIT(E) on certain terms and conditions which have to be met by the assessee because the registration under Section 12 A of the Act does not automatically guarantee the exemption from income tax under Section 11 of the Act. The Ld. DR further submitted that the main condition for grant of registration u/s 12A of the Act and entitlement of exemption from tax was that the trust or institution should establish before the Assessing Officer that the activities under taken by the trust are charitable in nature and in accordance with objects of the trust and the assessee is complying with all the conditions of the Act. The Ld. DR also submitted that the registration granted under Section 12A of the Act casts onus on the assessee to prove that the Provisions of Section 2(15) and Section 11 of the Act have been satisfied and there is no contravention of Provisions of Section 13 of the Act by the assessee. The Ld. DR vehemently contended that once it is discovered that the assessee trust has not undertaken any charitable activities then the conditions prescribed in registration certificate are violated and Assessing Officer is entitled to hold that the exemption under Section 11 of the Act is not allowable to the assessee. The DR concluded his submissions with a contention that the assessee is bound to prove that it provided donations to the charitable entities which have similar to the objectives assessee trust and in absence of the same it cannot be said that the assessee trust applied its funds, donations and receipts for charitable purpose as per objects of the assessee trust.