DIT(E) at time of grant of registration under section 12AA cannot step into shoes of Assessing Officer

IT : For achieving main charitable object if an institution carries on some commercial activity and generates profit therefrom such activities cannot be considered to be business activity with profit motive so long as profit earned is utilized for purpose of achieving charitable object
IT : DIT(E) at time of grant of registration under section 12AA cannot step into shoes of Assessing Officer to examine whether assessee has carried out any activity with profit motive or there is violation of conditions laid down under section 11
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[2014] 49 taxmann.com 248 (Hyderabad - Trib.)
IN THE ITAT HYDERABAD BENCH 'A'
George Institute & Global Health
v.
Director of Income-tax (Exemption), Hyderabad*
B. RAMAKOTAIAH, ACCOUNTANT MEMBER
AND SAKTIJIT DEY, JUDICIAL MEMBER
IT Appeal No. 1773 (Hyd.) of 2012
[ASSESSMENT YEAR 2008-09]
JULY  23, 2014
Section 2(15) of the Income-tax Act, 1961 - Charitable purpose (Object of general public utility/Profit motive) - Assessment year 2008-09 - Whether in order to achieve main charitable object if an institution carries on some commercial activity and generates profit therefrom, such activities cannot be considered to be business activity with profit motive so long as profit earned is utilized for purpose of achieving charitable object - Held, yes [Para 5.3]
Section 12AA, of the Income-tax Act, 1961 - Charitable or religious trust - Registration procedure (Scope of power of DIT(E)) - Assessment year 2008-09 - Whether DIT(E) at time of grant of registration under section 12AA cannot step into shoes of Assessing Officer to examine whether assessee has carried out any activity with profit motive or there is violation of conditions laid down under section 11 - Held, yes [Paras 5.3 and 5.5] [In favour of assessee]