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7. The residuary estate comprised of a sum of Rs. 2,13,60,528 kept in various banks. This amount was utilised by the executors of the Will as the corpus of the trust created w.e.f. 1st April, 2001 by means of the trust deed executed and registered on 31st March, 2001. There were five trustees including the two executors of the Will.

8. The appellant applied for registration under Section 12A of the IT Act, 1961 and pursuant thereto the "DI" gave a hearing when the appellant was required to file copy of the Will of late Smt. Prem Lata Dawar as also to produce the original trust deed. The "DI" examined the Will and the trust deed observing that "the objects of the trust are charitable in nature" but by means of an order sheet entry, he raised the following specific query :

10. The other plea on behalf of the trust was that the enquiry contemplated under Section 12AA was restricted to the examination of the genuineness of the objects of the trust or its charitable nature and not to the conducting of an enquiry whether the formation was in accordance with the provisions of the Will or otherwise.

11. The objections raised by the trust were considered by the "DI" and he proceeded to record his views as follows :

(i) the directions in the Will were binding on the executrixes and if they did not have any mandate under the Will to settle the property on the trust created with the residuary estate, then such disposal of assets would be against the law leading to the inference that no property was settled on trust and such a trust would be non est in law.

24. In the- present case, the "DI" does not doubt the charitable nature of the purported activities of the appellant trust and his main objection is that the Will does not authorise the executrixes to set up a trust and further he is entitled to look into the Will to satisfy himself about the genuineness of the trust and its activities. As against this, the argument of the learned counsel for the appellant is that the Will cannot be looked into and what the law provides is that the "DI" may ensure that the trust is validly created and its objects are charitable in nature.

34. In the case of M. Visvesvaraya Industrial Research & Development Centre v. ITAT and Anr. (supra) their Lordships of the Bombay High Court held that registration under Section 12A did not preclude an inquiry whether the income of the trust had been applied for charitable purposes in a particular year. This supports the view expressed in the earlier part of our order and even otherwise the newly inserted provisions of Section 12AA were not under consideration of their Lordships.

35. In the case of Fifth Generation Education Society v. CIT (supra) their Lordships held that registration under Section 12A was a precondition for availing the benefits under Sections 11 and 12 and at this stage, the CIT was not required to examine the application of income and all that he was to examine was whether the application was made in accordance with the requirements of Section 12A r/w Rule 17A of the IT Rules, 1962, and whether Form No. 10A had been properly filled up. Further, he was also to see whether the objects of the trust were charitable or not. We have already opined so in the earlier part of our order with reference to provisions of Section 12AA highlighting its comparison to Section 12A. Their Lordships of the Allahabad High Court observed that no activity needs to be carried on by the society for obtaining registration. This view squarely applies to the facts before us where provisions of Section 12AA are also under consideration.