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Facts
The assessee filed an appeal challenging the order of the CIT(Exemptions) for AY 2026-27, where the application for registration under Section 12A was rejected. The assessee did not appear before the tribunal despite repeated calls, but the Ld. DR was present.
Held
The Tribunal, while noting the assessee's non-appearance, decided to grant one more opportunity to the assessee to substantiate its claim before the CIT(E). A cost of Rs. 5000/- was imposed on the assessee.
Key Issues
Whether the rejection of registration by the CIT(Exemptions) was justified without providing adequate opportunity and proper examination of documents, and if a fresh opportunity with cost should be granted.
Sections Cited
2(15), 12A, 12A(1)(ac)(vi), 12AB(1)(b)(i)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “A” BENCH, MUMBAI
Before: SHRI SANDEEP GOSAIN& SHRI PRABHASH SHANKAR
Date of Hearing 17.12.2025 Date of Pronouncement 22.12.2025 ORDER Per: SHRI. SANDEEP GOSAIN, J.M.:
The present appeal has been filed by the assessee challenging the impugned order dt. 07.05.2025 passed by Commissioner of Income Tax (Exemptions) for the A.Y 2026-27. The assessee has raised the following grounds of appeal:
The learned CIT(Exemptions) erred in rejecting the application without recording any finding that the Appellant's objects are 1 non-charitable OR fall within the mischief of the proviso to Section 2(15). Rejection on mere technical OR interpretational grounds in the absence of adverse material is unjustified.
2. The impugned order is bad in law as it does not meet the test of a reasoned and speaking order and ignores material facts and evidence placed on record, warranting setting aside and directing grant of registration, OR in the alternative, restoration to the file of the learned CIT(Exemptions) for de novo adjudication after affording due opportunity.
3. The Appellant craves leave to add, alter, amend, OR withdraw any ground at the time of hearing.
4. On facts and in law, the learned CIT(Exemptions), Pune erred in rejecting the application for registration under Section 12A of 4 the Income-tax Act, 1961 by order dated 19.06.2025, without affording adequate and meaningful opportunity of being heard, thereby violating the principles of natural justice.
The learned CIT(Exemptions) erred in failing to appreciate that the Appellant had furnished replies to show cause notices dated 05.03.2025 and 20.05.2025 along with documents including organization details, applicability of the Bombay Public Trusts Act, undertaking on Section 2(15), and NOC for premises; absence of discussion of submissions renders the order non- speaking and arbitrary in the absence of discussion on these submissions.
6. The learned CIT(Exemptions) erred in holding that the absence of administrative/establishment expenses in the financial statements for FY 2023-24 was sufficient to doubt genuinenessof activities, without considering that volunteer- driven trusts may legitimately incur minimal overhead expenses, which fact could have been clarified if further opportunity had been provided.
The learned CIT(Exemptions) erred in concluding non- fulfilment of Section 12A(1)(ac)(vi)(B) conditions without proper examination of bank statements, activity evidence, and compliance records that were specifically sought, thereby basing the rejection on suspicion rather than objective satisfaction as required under Section 12AB(1)(b)(i).
None appeared on behalf of the assessee when the case was called repeatedly. From the case file, we noticed that on the previous occasion also assessee had sought adjournment and again today nobody appeared. On the other hand Ld. DR is ready with the arguments. Therefore, we have decided to proceed with the hearings as the case ex-parte.
We have heard Ld. DR, perused the material placed on record, judgments cited before us and also orders passed by the revenue authorities. From the records, we noticed that assessee had filed application in Form 10AB u/s 12A(1)(ac)(vi)-ITEM(B) of the Act before Ld. CIT(E) but could not submit the details called for by the Ld. CIT(A). Therefore in the absence of the required documents application filed by the assessee was rejected. Now before us assessee had taken ground No. 2 wherein the assessee had submitted that he had already placed material facts and evidences on record before Ld. CIT(E) which were not even considered by Ld. CIT(E). Assessee has also raised a specific ground No. 4 that matter in question was decided without affording ‘adequate and reasonable opportunity’ of hearing. Although assessee has not placed on record before us any documentary evidences which were filed by him before Ld. CIT(E).
Making the difference foundation, Mumbai.
But be that as it may without going into the merits of the claim raised by the assessee, bench is of the view that one more opportunity be granted to the assessee to substantiate its claim before Ld. CIT(E). Since the assessee has not appeared before us even in spite of several calls, therefore a cost of Rs. 5000/- is imposed upon the assessee which shall be deposited in the Prime Minister Relief Fund and a copy of the receipt shall be placed on file before Ld. CIT(E) within 30 days from the date of receipt of this order. The assessee shall not seek any adjournment on frivolous grounds and shall remain cooperative during the course of proceedings.
6. Before parting, we make it clear that our decision to restore the matter back to the file of the Ld. CIT(E) shall in no way be construed as having any reflection or expression on the merits of the dispute which shall be adjudicated by the Ld. CIT(E) independently in accordance with law.
In the result the appeal filed by the assessee is allowed for statistical purposes.
Order pronounced in the open court on 22/12/2025.