The assessee-trust was granted registration under section 12AA of the Act by the Commissioner (E). The Department had not doubted the charitable nature of the objects for which the assessee was established. The grant of recognition under section 80G of the Act, acted as a catalyst and resulted in donations which in turn resulted in charitable activities. In other words, there was encouragement for donors to donate when the trust was recognized under section 80G of the Act. Therefore, grant of recognition under section 80G of the Act may be a condition precedent for achieving the objects for which the trust was established. The case was restored to the files of the Commissioner (E) who was to consider the assessee’s application for recognition under section 80G(5)(vi) of the Act afresh. The reasons stated by the Commissioner (E) could not be a ground to deny the benefit of recognition under section 80G(5)(vi) of the Act. The Commissioner (E) shall afford a reasonable opportunity of hearing to the assessee and shall take a decision in accordance with law.