JUDGMENT K.S. Jhaveri, J. - By way of this appeal, the Department has assailed the judgment and order of the Tribunal whereby Tribunal has allowed the application of the assessee for grant of benefit under section 12A of the Income Tax Act. 2. The facts of the case are that the applicant, a society registered with Registrar of Societies on 30.9.1976 had filed an application seeking registration under section 12A of the I.T. Act on 27.3.2005. The same has been rejected by the ld. CIT on the basis that activity of the applicant could not be termed as charitable within the meaning of section 2 (15) of the Act; there were huge surpluses during Financial Years 2001-02 (Rs.63,33,168/-), F.Y. 2002-03 (Rs. 9,79,764/-), F.Y. 2003-04 (Rs.63,33,168/-) and F.Y. 2004-05 (Rs.92,82,728/-); accounts were not audited and returns of income for such years in which total income exceed Rs. 50,000/- were not filed along-with Form No. 10B. 3. This court while admitting the appeal has framed following substantial question of law:- "(i) Whether in the facts and circumstances of the case, the ITAT has not acted illegally and perversely in directing the CIT to grant registration to the respondent under section 12A for the claimed period?" 4. Now, the issue is squarely covered by the decision of Madras High Court in Director of Income Tax (Exemptions) vs. Spic Educational Foundation reported in (2002) 257ITR 46 (Mad.) wherein it has been held as under:- "The question referred to us is as to whether, on the facts and in the circumstances of the case, the Appellate Tribunal was right in law in holding that non-filing of the audit report in Form No. 10B of the Income Tax Rules, 1962, would not defeat the claim of the assessee for exemption under Sections 11 and 12 of the Income Tax Act, 1961. Section 12A of the Act deals with the conditions as to the registration of a trust, etc. It provides that the provisions of Sections 11 and 12 will not apply in relation to the income of a trust or institution unless the conditions set out in Section 12A of the Act are fulfilled. Section 12A of the Act deals with the conditions as to the registration of a trust, etc. It provides that the provisions of Sections 11 and 12 will not apply in relation to the income of a trust or institution unless the conditions set out in Section 12A of the Act are fulfilled. One such condition is that prescribed under Clause (b) which reads as under : "where the total income of the trust or institution as computed under this Act without giving effect to the provisions of Section 11 and Section 12 exceeds twenty-five thousand rupees in any previous year, the accounts of the trust or institution for that year have been audited by an accountant as defined in the Explanation below Sub-section (2) of Section 288 and the person in receipt of the income furnishes along with the return of income for the relevant assessment year the report of such audit in the prescribed form duly signed and verified by such accountant and setting forth such particulars as may be prescribed." 5. He contended that tribunal has seriously committed an error in considering the issue and directing for registration. 6. Counsel for the respondent has taken us to the order of the Tribunal which reads as under:- "We find substance in the above contentions of the Ld. A.R. The activities of the applicant have been enumerated in Sections 9 & 10 of the Seed Act placed on record on perusal of which it appears that the main object of the applicant society is to ensure the supply of proper seeds to the general farmers to protect their interest. For this purpose the applicant on charging of the prescribed fee use to issue certificate to the persons selling, keeping for sale, offering to sale, bartering or otherwise supplying any seed of any notified kind or variety. On receipt of such application for the grant of a certificate, the certification agency may, after such inquiry as it thinks fit and after satisfying itself that the seed to which the application relates confirms to the minimum limits of germination and purity specified for that seed under clause (a) of Section 6. grant a certificate in such form and on such conditions as may be prescribed provided that such standards shall not be lower than the minimum limits of germination and purity specified for the seed clause (a) of Section 6. grant a certificate in such form and on such conditions as may be prescribed provided that such standards shall not be lower than the minimum limits of germination and purity specified for the seed clause (a) of Section 6. Thus, these activities of the assessee are for advancement of the object of general public utility, hence the activities are for charitable purpose within the meaning of Section 2(15) of the Act. If an institution is having the surplus, then after considering the application and the accumulation prescribed under section 11, the remaining amount is chargeable to tax. But that in itself does not lead to a conclusion that the institution is not meant for charitable purpose but for business purpose. Admittedly, all the required formalities which the assessee was supposed to complied with while applying for registration were fulfilled and those which remained unfulfilled were complied with during the disposal of application for registration before Ld. CIT as he had pointed out. The delay in moving the application for registration was also explained that it was due to bona fide belief that assessee is a part of government hence not liable to income tax. We also find from the record that in the case of similarly situated assessee i.e. Uttaranchal State Seed and Organic Production Certification Agency, Dehradoon the CBDT vide its letter dated 25.5.2006 has notified in the Gazette of India that the institution shall not be included in the total income of such person as assessable for the A. Yrs. 2002-03 to 2004-05 subject to certain conditions. A copy of this notification has been placed at page No.5 of the written synopsis. Similar notification has also been published in the gazette in the case of Andhra Pradesh State Seed Certification Agency, Hyderabad for the A. Yrs. 1995-96 to 1997-98, a copy whereof has been placed at page No.6 of the written synopsis. A copy of this notification has been placed at page No.5 of the written synopsis. Similar notification has also been published in the gazette in the case of Andhra Pradesh State Seed Certification Agency, Hyderabad for the A. Yrs. 1995-96 to 1997-98, a copy whereof has been placed at page No.6 of the written synopsis. The registration under section 12A of the Act for entitlement to claim the benefits under sections 11 & 12 of the Act requires two conditions to be fulfilled, firstly that the person concerned should have made an application for registration in the prescribed form and in the prescribed manner to the authorities named in that section before the first day of July, 1973, or before the expiry of the period of one year from the date of the creation of the trust or establishment of the institution and secondly, the person concerned would deep the accounts in a particular manner and such accounts should be audited. In our view, as discussed above the assessee has fulfilled both the conditions and the delay in making the application for registration has also been successfully explained and that being sufficient cause for the delay, we condone the delay with direction to the Ld. CIT to grant the registration on the application filed by the assessee for the purpose in Form No. 10A before Ld. CIT on 27.3.2005 for the claimed period. The ground is thus allowed." 7. In our view, the tribunal has not committed any error in condoning the delay and directing the authority to consider the same since same benefits were conferred in Andhra Pradesh and Uttranchal. 8. In that view of the matter, the assesee cannot be deprived of the benefit. 9. We see no reason to interfere in the order of the Tribunal. 10. The issue is answered in favour of the assessee and against the department.