While allowing the appeal challenging the cancellation of provisional registration of the applicant trust u/s 12AB of the Income Tax Act, the Pune ITAT set aside the order of CIT(E) and remanded.
Finding that the Assessee Trust had applied for registration within the time allowed under the Income Tax Act, the Pune ITAT directed the CIT(E) to treat the application being filed within statutory.
Relying on decisions of Supreme Court and High Court, the Pune ITAT directed the AO to allow the deduction u/s 80P(2)(a)(i) and 80P(2)(d) of Income Tax Act, 1961 in respect of interest income earned.
On finding that entire proceeding was based on the covenants of the trust deed but not on the actual activities carried out by the appellant trust, the Pune ITAT set aside the order passed by CIT(E).