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"7. On perusal of submissions made by the assessee, it is noticed that :-
(i) That the President or Vice President has not produced as desired.
(ii) The assessee has not given criteria fixed for selection of candidates for grant of scholarship for studying in Foreign Country.
(iii) The assessee has not produced original records in support of receipt of application and its processing done by the society.

5.4 From the above Para of CIT(A), it is seen that he has simply followed the order of his predecessor for assessment year 2005-06. In the paper book, the assessee has enclosed the order of CIT(A) for assessment year 2005-06 also, which is available on page No. 24 to 30 of the paper book. In that order, the CIT(A) has decided this issue as per Para 11 of his order and for the sake of ready reference, Para 11 of the order of CIT(A) for assessment year 2005-06 is also reproduced below:

"11. I have considered the facts and circumstances of the case and the issue of grant of scholarship to Shri Adheesh Bhagat with reference to "application of funds for charitable purpose". The submissions of the appellant as noted in para-10 above show that grant of scholarship to "deserving candidate" is part of memorandum / Object of the society. The appellant society is holding valid registration u/s 12A for this period. It seems that the criteria of "deserving candidate" has been considered by the AO in a narrow manner, confining it to poor status only. In such a situation, the interpretation taken by AO is not correct and I am of the view that merit in studies is also a good criteria for deserving grant and scholarship. To this extent, the reasons and discussion of the financial status of Shri Adheesh Bhagat are irrelevant because object of the society includes wider areas of eligibility for grant of scholarship. Same has been acknowledged and recognized by the Department as charitable by virtue of registration of society u/s 12A which is continuing during the year. The other discussions made by AO on the process of selection of Shri Adheesh Bhagat do not lead to any situation / conclusion where provisions of section 13 of the I.T. Act could be applied. Admittedly, as submitted before me also and noted in para-10(g) above, Shri Adheesh Bhagat is not related to society or its members in any manner, making him "specified person".
by way of trivial procedural lapses, this in itself does not change the nature of application of income towards charitable purpose which is factually verified and accepted by AO as such. Under the circumstances, the addition made by AO is directed to be deleted and ground no. 2 of appeal is allowed."
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5.5 From the above Para of the order of CIT(A), it is seen that he has brushed aside all the objections of the Assessing Officer by stating that by way of trivial procedural lapses, this in itself does not change the nature of appolication of income towards charitable purposes which is factually verified and accepted by the Assessing Officer as such. We fail to understand as to how CIT(A) is stating that the Assessing Officer has factually verified and accepted the application of income towards charitable purposes when the Assessing Officer is raising so many objections in the assessment order. All the objections of the Assessing Officer are already reproduced by us above. Most important objection of the Assessing Officer is that the application of Mr. Adheesh Bhagat was dated 16 th May, 2003 and the copy of this application is available on page 15 of the paper book and from the same, we find that the address of the applicant is of Calcutta. The application is addressed to the President of the assessee society at Kanpur. It is stated that this application dated 16th May, 2003 was considered by the scholarship committee of the assessee society. The minutes of meeting of scholarship committee of the assessee society held on 18th May, 2003 is available on page NO. 23 of the paper book. This minutes has been signed at 11.30 a.m. It is also observed in the said minutes that after prolonged interview process and considering the academic background of various candidates, the said selection committee has recommended that the scholarship by granted to Mr. Adheesh Bhagat. We fail to understand that how an application dated 16 th May, 2003, by a person residing in Calcutta, had reached to the President of the assessee society on 17th May, 2003 and thereafter, the managing committee of the assessee society had formed a scholarship committee who has called this person from Calcutta for interview and this person appeared before the scholarship committee for prolonged interview on 17th May, 2003 and thereafter, the said scholarship committee had reached to the conclusion to recommend granting of scholarship to Mr. Adheesh Bhagat as per the minutes signed on 18 th May, 2003 at 11.30 a.m. The chronology and timing of these events support the case of the Assessing Officer that there was no genuine process of selection/interview and it was all manipulation made by the assessee society and the scholarship was granted to Mr. Adheesh Bhagat at the sole discretion of the Vice President / President who intentionally avoided to appear before the Assessing Officer for fear of interrogation. This vital objection of the Assessing Officer is as per clause (vii) of Para 7 of the assessment order reproduced above. We have also seen that even this vital objection of the Assessing Officer has not been controverted by CIT(A) in his order in the present year or in assessment year 2005-06. Considering all these facts, we are of the considered opinion that in the facts of the present case, it cannot be said that granting of scholarship to Mr. Adheesh Bhagat was after carrying out genuine process of selection/interview. Apart from this, we also find that no material has been brought on record to show that any advertisement was made by the assessee society for inviting applications for such scholarship. In the application of Mr. Adheesh Bhagat appearing on page No. 15 of the paper book also, there is no mention as to how he came to know about the assessee society and its programme for granting scholarship for studying abroad. We also find that in the said application, it is stated by Mr. Adheesh Bhagat that he has appeared in ICSE examination and the result was awaited. He has also undertaken to forward the copy of mark sheet after he received the same. We fail to understand that when the mark sheet was still awaited then what was the basis for decision that he is a fit candidate for scholarship. In this regard, it was submitted by Learned A.R. of the assessee that as per page No. 21 & 22 of the paper book, being letter from the University, in which it is stated that Mr. Adheesh Bhagat has been granted admission being one of total 4390 students selected for admission out of around 45,000 high achieving applicants. It may be considered to be a good basis for considering the eligibility of applicant but when the application along with these enclosures cannot reach to the managing committee of the assessee society and the scholarship committee in time i.e. by 17th May, 2003 and it is not shown as to how Mr. Adheesh Bhagat was contacted for attending the interview and how he reached Kanpur for attending interview, all these material cannot justify his selection because these material cannot be available before the selection committee along with this fact that the candidate Mr. Adheesh Bhagat cannot be available for interview on 17 th May 2003 in the chronology of events discussed above. Hence, considering the impossibility of interview of Mr. Adheesh Bhagat by the selection committee, as claimed in the absence of any positive material having been brought on record by the assessee before any of the authorities below or before us, we are of the considered opinion that the order of CIT(A) on this issue is not sustainable. We, therefore, reverse the same and restore that of the Assessing Officer.