SARVA MANGAL KAIVALYAM RELIGIOUS TRUST,MUMBAI vs. COMMISSIONER OF INCOME TAX (EXEMPTION), MUMBAI

As stated by the learned Commissioner of Income-tax (Exemptions) in the impugned order, the assessee had filed an application seeking registration under section 12AB of the Act. During the course of proceedings, a hearing notice dated 30.01.2026 was issued to the assessee. Since there was no response to the said notice, the learned CIT(E) proceeded to dispose of the application and rejected the same. The relevant facts, as emerging from the impugned order, are thus essentially that the application came to be rejected on account of non-compliance with the aforesaid hearing notice.

The assessee has raised the following grounds of appeal:

Before us, the learned Authorised Representative (ld.AR) submitted that the application filed by the assessee was proper in all material respects and that the assessee could not comply with the hearing notice dated 30.01.2026 as the same was issued on the email ID mukeshszaveri@gmail.com, which, according to the assessee, belonged to a trustee who was no longer associated with the trust and was therefore inaccessible to the assessee. It was submitted that the assessee consequently remained unaware of the hearing notice and the non- compliance was neither deliberate nor intentional. The learned AR further submitted that the application ought not to have been rejected merely for non-response to a single notice without granting a further effective opportunity to explain the matter and furnish the requisite documents. It was accordingly prayed that the matter be restored to the file of the learned CIT(E) for fresh adjudication after considering the documents furnished by the assessee and after granting an effective opportunity of being heard.

The learned Departmental Representative (ld.DR), on the other hand, supported the order of the learned CIT(E). He submitted that adequate opportunity had been afforded to the assessee during the proceedings and that the assessee had failed to comply with the notice issued by the learned CIT(E). It was accordingly submitted that the rejection of the application was justified and that no interference with the impugned order was called for.

We have considered the rival submissions and perused the material available on record. The undisputed position emerging from the impugned order is that the application under section 12AB came to be rejected essentially on account of non-compliance with the hearing notice dated 30.01.2026. The assessee has furnished an explanation that the notice was issued on the email ID of a person who was no longer a trustee of the assessee-trust and that, consequently, the assessee was not aware of the said notice.

In our considered view, when the assessee has furnished a specific explanation for its failure to respond to the notice, it would be appropriate, in the interest of substantial justice, that the application be examined afresh by the competent authority after taking into consideration the material furnished by the assessee. Rejection of an application involving determination of the assessee's eligibility on the basis of non-compliance with a single hearing notice, particularly when the assessee has subsequently furnished an explanation for such non- compliance, would not constitute an effective opportunity to the assessee to present its case.

We, therefore, set aside the impugned order of the learned CIT(E) and restore the matter to his file for fresh adjudication of the application filed by the assessee under section 12AB. The learned CIT(E) shall consider the documents that may be furnished by the assessee as well as such further documents or explanations that may be called for by him during the fresh proceedings and shall decide the application in accordance with law. Needless to say, the assessee shall be afforded a reasonable and effective opportunity of being heard before passing the fresh order.

We make it clear that we have not expressed any opinion on the merits of the assessee's eligibility for registration under section 12AB, and all such issues are left open for consideration by the learned CIT(E) in the fresh proceedings.

In the result, the appeal of the assessee is allowed for statistical purposes.