At the time of seeking registration under Section 12-AA, the authority must be subjectively satisfied that the objects and proposed activities of the Trust are genuinely charitable in nature. It is not required that the trust should be carrying on activities at the stage of registration

(i) The very purpose for any assessee to seek registration under Section 12AA of the Act is to claim exemption under Sections 10 and 11 respectively of the Act, as the case may be. Therefore, before seeking registration, it is essential that the Trust should adduce cogent material to the satisfaction of the Commissioner that the activities are genuinely charitable in nature.

(ii) Mere registration under Section 12-AA automatically does not entitle any charitable trust to claim exemption under Sections 10 and 11 respectively of the Act, 1961. When a return is filed by any trust claiming exemption it is for the assessing officer to look into all the materials and satisfy itself whether the exemption has been claimed genuinely or not. If the assessing officer is not convinced it is always open for him to decline grant of exemption.

(Ananda Social and Educational Trust vs. Commissioner of Income Tax
and Anr. reported in [(2020) 17 SCC 254] followed)