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4. The assessee assessee is a charitable trust and was established in the year 2003. The assessee trust is running medical college i.e. educational institutions. Besides the educational institutions, the assessee Gian Sagar Educational & Charitable Trust trust is also running a hospital at Banur, Punjab. Since, the objects of the assessee trust being charitable within the meaning of section 2(15) of the Income Tax Act, 1961 and hence the assessee trust was granted registration u/s 12AA of the Act on 02.04.2005 by the Commissioner of Income Tax vide an order CIT/CHD-II/Tech/3612. Apart from the registration, the assessee was also granted approval u/s 80G of the Act vide F. NO. CIT- II/CHD/80G/Tech/l87-471 on 07.05.2007 by the Commissioner of Income Tax, Chandigarh. Since inception, the assessee trust was carrying out its charitable activities in accordance with the objects as provided in the trust deed and the receipts of the assessee trust has been applied towards its charitable objects. After the establishment of the assessee trust, it was regularly filing its return of total income by claiming exemption u/s 11/12 of the Act.

27. It was argued that the assessee is a charitable institution and is engaged in the charitable activities in accordance with the objects stated in the trust deed. It is submitted that after the allegation, the CBI had visited the premises of the assessee several times, and had also examined the books of account of the assessee trust, and no discrepancy whatsoever was found in the books of account so maintained by the assessee.

28. The assessee trust has been carrying out its activities in accordance with its objects and providing education and medical relief and same is not in dispute. The registration of the assessee has been cancelled purely on the basis of the allegation and no more. It was argued that the ld. Pr. CIT has completely failed to appreciate that even after the lodging of the FIR, inspection of the assessee premises was carried out twice, and on each occasion, it was found that assessee had requisite infrastructure for the approval and recommendations made by the Executive Committee of the MCI at its meeting on 05.04.2010 to grant permission for admission of 100 students in the year 2010-11 for the fourth batch of MBBS Students at the Gian Sagar Medical College & Hospital, Patiala was justified on the basis of the report of the Council of Inspectors. In such circumstances, Gian Sagar Educational & Charitable Trust cancellation of the registration of the assessee trust by the Pr. CIT is wholly unsustainable in law. It was submitted that u/s 12AA(3) of the Act, registration can be cancelled only when the Principal Commissioner is satisfied that activities of such trust or institution are not genuine or are not being carried out in accordance with the objects of the trust or institution. In this case, the ld. AR argued that it would be seen that the learned Pr. CIT without any tangible material and purely on the basis of the allegation has held that assessee trust was involved in the nefarious activities which allegation is factually incorrect and without any material.