SOLAPUR OPHTHALMOLOGICAL SOCIETY,SOLAPUR vs. COMMISSIONER OF INCOME TAX, EXEMPTION, PUNE

We note that, the appellant vide Form No. 10AB dt. 23/02/2023 made an application to the respondent under clause (iii) of section 12A(1)(ac) of the Act thereby sought regular/final registration u/s 12AB of the Act. The appellant’s failure to annexe required documents as contemplated u/r 17A(2)(k) of IT-Rules, the Ld. CIT(E) by notice dt. 22/05/2023 accorded an opportunity to make good the deficiency of the application, the assessee ITAT-Pune Page 1 of 4

In the absence of compliance, the Ld. CIT(E) rejected to grant regular registration and provisional registration granted to the appellant u/s 12AB r.w.s. 12A(1)(ac)(vi) of the Act is cancelled as he could not draw any satisfactory conclusion about the genuineness of activities of the appellant and satisfaction over compliance of requirements of any other law for the time being in force by the trust / institutions as are material for the purpose of achieving its objects.

At the outset, without referring to the metis of case, the Ld. AR submitted that, having prepared reply against discrepancies communicated, the appellant failed to submit the same within a short time of seven days allowed to it, which ultimately resulted into the rejection of its application. Therefore appellant seeks one more fair opportunity to represent its case before the registering authority. Per contra, the Ld. DR contended that, second notice communicating various discrepancies was served on 14/07/2023, although it was due for compliance by 20/07/2023, however till the culmination of proceedings the appellant didn’t bother to make any submission. Therefore this lapse is solely attributable to the assessee’s lackadaisical approach; hence a reasonable cost may be imposed if appellant’s request for remand is considered positively.

We have heard both the parties to the dispute; and subject to the provisions of rule 18 of ITAT-Rules, 1963 perused material placed on record.

At the outset, we note that, the Ld. CIT(E) after his preliminary verification of application and detailed submission made by the appellant, has noted certain discrepancies and communicated the same literally allowing seven days to cure the defect with necessary details and explain the discrepancies, and within next seven days therefrom has culminated the registration proceedings by an impugned order of rejection. It is to be appreciated that, the very purpose of the provisions for registration of trust u/s 12A/12AB and granting of recognition u/s 80G of the Act derives their spirit from Directive Principles of State Policy enshrined in the Constitution of India. The Govt. of India makes every endeavour to provide welfare to one and all. In view thereof registrations to charitable trusts are given in order to ensure certain benefits flows to entire society therefrom. Thus the Directive Principles of State Policy are achieved. These provisions of registration u/s 12A/12AB and u/s 80G of the Act enhance socio economic welfare of the society. Furthermore, Income Tax laws are welfare legislations and not penal in nature, therefore, in larger interest of justice assessee was remained to be given fair opportunity to represent its entitlement for registration.

With the forgoing observations, we are of the considered view that, the present appellant was not provided with reasonable time to make good the defect or remove the discrepancies notified to it. Therefore in all the fairness the assessee society deserves to be re-heard one more time with ITAT-Pune Page 3 of 4

Needless to say that, the appellant shall comply with the direction of registering authority by adhering to timeliness, seeking no unreasoned adjournment.

In result, the appeal is ALLOWED FOR STATISTCIAL PURPOSES. U/r 34 of ITAT Rules, order pronounced in open court on this Monday 23th day of October, 2023.