Assessee-trust was engaged in charitable activities of providing medical aid to underprivileged sections of society. It applied for registration under section 12AB.CIT(E) rejected application for registration on the ground that the assessee had not commenced its activities and a substantial portion of donations was invested in fixed deposits and only a small amount was spent on medical relief. On appeal, the Tribunal held that the assessee had already commenced its activities by incurring medical relief expenses towards attainment of its objects. Further, assessee had filed Form No. 10 for accumulation of a certain amount for a proposed charitable project in line with the objects of trust.   Since it was the first year of operation, assessee was not able to spend on large-scale activity and hence invested a certain amount in a fixed deposit as per the prescribed mode. Therefore, it was only the genuineness of activity and not a substantial amount of expenditure that was relevant for granting registration under section 12AB. The CIT(E) was directed to grant the exemption. The Tribunal also held that CIT(E)  had not brought any material on record to show that assessee-trust’s activities were not genuine or that conditions as specified under section 80G(5) were not fulfilled; approval under section 80G could not be denied.