CIT cannot reject the application for registration of Trust u/s 12A merely on the count that the activities of the Trust have not commenced:

The assessee-trust moved an application for registration u/s 12A which was rejected by CIT merely because that the trust had not commenced its activities. Hon’ble High Court observed that as per S.12A, the provisions of S.11 & S.12 shall not apply unless a Trust moves an application for registration before CIT within one year from the date of its creation and the Trust is registered u/s 12AA. As per S.12AA, CIT may, on receiving such an application, call for such documents or information from the Trust as he may think fit so as to satisfy himself about the objectives of the Trust and the genuineness of its activities. However, this does not imply that if the activities of the Trust have not commenced, CIT has an authority to reject the application for the registration on the ground that the Trust failed to convince him about the genuineness of its activities. It was held that CIT was not justified in rejecting the application for registration of Trust on the count that its activities had not commenced.

[CIT Vs. KUTCHI DASA OSWAL MOTO PARIWAR AMBAMA TRUST - TAX APPEAL NO.918 of 2011 – GHC]