R.B. GUPTA CHARITY TRUST,MUMBAI vs. ITI EXEM. WARD 2(2) , MUMBAI

The brief facts of the case are that the a The brief facts of the case are that the assessee, R. B. Gupta Charity Trust, ssessee, R. B. Gupta Charity Trust, filed an application in Form No. 10AB on 30.09.2025 seeking renewal of filed an application in Form No. 10AB on 30.09.2025 seeking renewal of filed an application in Form No. 10AB on 30.09.2025 seeking renewal of registration under section 12AB of the Act. During the course of examination of registration under section 12AB of the Act. During the course of examination of registration under section 12AB of the Act. During the course of examination of the application, the CIT(Exemptions) observed that the application filed by the the application, the CIT(Exemptions) observed that the application fi the application, the CIT(Exemptions) observed that the application fi assessee trust was not complete and the documents required under Rule 17A(2) assessee trust was not complete and the documents required under Rule 17A(2) assessee trust was not complete and the documents required under Rule 17A(2) of the Income-tax Rules had not been furnished. Accordingly, CIT(Exemptions) tax Rules had not been furnished. Accordingly, CIT(Exemptions) tax Rules had not been furnished. Accordingly, CIT(Exemptions) issued a notice dated 08.01.2026 asking the assessee to furnish complete details issued a notice dated 08.01.2026 asking the assessee to furnish complete details issued a notice dated 08.01.2026 asking the assessee to furnish complete details and supporting documents. Since, according to the CIT(Exemptions), there was ting documents. Since, according to the CIT(Exemptions), there was ting documents. Since, according to the CIT(Exemptions), there was no compliance to all the terms of the aforesaid notice, he held that he was unable no compliance to all the terms of the aforesaid notice, he held that he was unable no compliance to all the terms of the aforesaid notice, he held that he was unable to satisfy himself regarding the objects of the trust, the genuineness of its to satisfy himself regarding the objects of the trust, the genuineness of its to satisfy himself regarding the objects of the trust, the genuineness of its activities and compliance wi activities and compliance with other laws material for achieving the objects of th other laws material for achieving the objects of the trust. The CIT(Exemptions) observed that in the absence of necessary the trust. The CIT(Exemptions) observed that in the absence of necessary the trust. The CIT(Exemptions) observed that in the absence of necessary compliance, he was unable to arrive at a satisfactory conclusion on the compliance, he was unable to arrive at a satisfactory conclusion on the compliance, he was unable to arrive at a satisfactory conclusion on the parameters contemplated under section 12AB(1)(b) of the Act parameters contemplated under section 12AB(1)(b) of the Act and, therefore, he and, therefore, he had no option but to reject the application seeking renewal of registration. had no option but to reject the application seeking renewal of registration. had no option but to reject the application seeking renewal of registration. Accordingly, vide order dated 01.03.2026, CIT(Exemptions) rejected the Accordingly, vide order dated 01.03.2026, CIT(Exemptions) rejected the Accordingly, vide order dated 01.03.2026, CIT(Exemptions) rejected the application filed by the assessee under section 12A(1)(ac)(ii) of the Act application filed by the assessee under section 12A(1)(ac)(ii) of the Act application filed by the assessee under section 12A(1)(ac)(ii) of the Act primarily on the ground of non he ground of non-compliance with the terms of the notice dated compliance with the terms of the notice dated 08.01.2026. Notably, the CIT(Exemptions) did not record any finding regarding 08.01.2026. Notably, the CIT(Exemptions) did not record any finding regarding 08.01.2026. Notably, the CIT(Exemptions) did not record any finding regarding the charitable objects of the trust, genuineness of its activities or violation of any the charitable objects of the trust, genuineness of its activities or violation of any the charitable objects of the trust, genuineness of its activities or violation of any provisions of law.

The assessee is in appeal before us against the order passed by assessee is in appeal before us against the order passed by assessee is in appeal before us against the order passed by CIT(Exemptions) dismissing the application of the assessee. CIT(Exemptions) dismissing the application of the assessee.

We have heard the rival contentions and perused the material on record. We have heard the rival contentions and perused the material on record. We have heard the rival contentions and perused the material on record. We find that the application filed by the assessee for renew We find that the application filed by the assessee for renewal of registration al of registration under section 12AB of the Act was rejected by the CIT(Exemptions) on account under section 12AB of the Act was rejected by the CIT(Exemptions) on account under section 12AB of the Act was rejected by the CIT(Exemptions) on account of non-compliance with the notice dated 08.01.2026. A perusal of the impugned compliance with the notice dated 08.01.2026. A perusal of the impugned compliance with the notice dated 08.01.2026. A perusal of the impugned order shows that the CIT(Exemptions) has not recorded any adverse finding order shows that the CIT(Exemptions) has not recorded any adverse finding order shows that the CIT(Exemptions) has not recorded any adverse finding with regard to the objects of the trust, the genuineness of its activities or ard to the objects of the trust, the genuineness of its activities or ard to the objects of the trust, the genuineness of its activities or violation of any other law material for achieving the objects of the trust. The violation of any other law material for achieving the objects of the trust. The violation of any other law material for achieving the objects of the trust. The order proceeds entirely on the footing that since the assessee had not complied order proceeds entirely on the footing that since the assessee had not complied order proceeds entirely on the footing that since the assessee had not complied with all the terms of the notice issued, the CIT(Exemptions) was unable to arrive notice issued, the CIT(Exemptions) was unable to arrive notice issued, the CIT(Exemptions) was unable to arrive at a satisfactory conclusion regarding the conditions prescribed under section at a satisfactory conclusion regarding the conditions prescribed under section at a satisfactory conclusion regarding the conditions prescribed under section 12AB. We further find that the assessee has specifically raised a grievance 12AB. We further find that the assessee has specifically raised a grievance 12AB. We further find that the assessee has specifically raised a grievance before us that the notice was never received before us that the notice was never received by the assessee trust and, therefore, by the assessee trust and, therefore, the non-compliance on part of the assessee trust was neither deliberate nor compliance on part of the assessee trust was neither deliberate nor compliance on part of the assessee trust was neither deliberate nor intentional.

In our considered view, rejection of an application under section 12AB of In our considered view, rejection of an application under section 12AB of In our considered view, rejection of an application under section 12AB of the Act, which confers substantive rights upon the the Act, which confers substantive rights upon the assessee, should not assessee, should not ordinarily be based merely on technical or procedural defaults without ordinarily be based merely on technical or procedural defaults without ordinarily be based merely on technical or procedural defaults without examining the charitable objects and genuineness of activities of the trust. The examining the charitable objects and genuineness of activities of the trust. The examining the charitable objects and genuineness of activities of the trust. The powers vested in the CIT(Exemptions) under section 12AB of the Act are powers vested in the CIT(Exemptions) under section 12AB of the Act are powers vested in the CIT(Exemptions) under section 12AB of the Act are quasi-judicial in nature and necessarily require due adherence to the principles cial in nature and necessarily require due adherence to the principles cial in nature and necessarily require due adherence to the principles of natural justice.

We find that CIT(Exemptions) did not have the opportunity to analyse the We find that CIT(Exemptions) did not have the opportunity to analyse the We find that CIT(Exemptions) did not have the opportunity to analyse the trust deed and the nature of charitable activities undertaken by the assessee. The trust deed and the nature of charitable activities undertaken by the assessee. The trust deed and the nature of charitable activities undertaken by the assessee. The Hon'ble Supreme Court in the case of Tin Box Company v. CIT [(2001) 249 le Supreme Court in the case of Tin Box Company v. CIT [(2001) 249 le Supreme Court in the case of Tin Box Company v. CIT [(2001) 249 ITR 216 (SC)] has held that where adequate opportunity has not been granted, ITR 216 (SC)] has held that where adequate opportunity has not been granted, ITR 216 (SC)] has held that where adequate opportunity has not been granted, the matter deserves to be restored for fresh adjudication. Similar principles have the matter deserves to be restored for fresh adjudication. Similar principles have the matter deserves to be restored for fresh adjudication. Similar principles have been laid down by the Hon'ble been laid down by the Hon'ble Supreme Court in Sahara India (Firm) v. CIT Supreme Court in Sahara India (Firm) v. CIT [(2008) 300 ITR 403 (SC)], wherein it was held that observance of principles of [(2008) 300 ITR 403 (SC)], wherein it was held that observance of principles of [(2008) 300 ITR 403 (SC)], wherein it was held that observance of principles of natural justice is an integral part of quasi natural justice is an integral part of quasi-judicial proceedings.

Accordingly, in light of the facts and circumstances of the Accordingly, in light of the facts and circumstances of the case and in the case and in the interest of justice, we deem it appropriate to set aside the impugned order passed interest of justice, we deem it appropriate to set aside the impugned order passed interest of justice, we deem it appropriate to set aside the impugned order passed by the CIT(Exemptions) and restore the matter to his file for de novo by the CIT(Exemptions) and restore the matter to his file for de novo by the CIT(Exemptions) and restore the matter to his file for de novo adjudication. The assessee is also directed to extend full cooperation and furnish adjudication. The assessee is also directed to extend full cooperation and furnish adjudication. The assessee is also directed to extend full cooperation and furnish such documents and information as may be called for by the CIT(Exemptions). h documents and information as may be called for by the CIT(Exemptions). h documents and information as may be called for by the CIT(Exemptions). We make it clear that we have not expressed any opinion on the merits of the We make it clear that we have not expressed any opinion on the merits of the We make it clear that we have not expressed any opinion on the merits of the claim and all issues are left open for adjudication afresh. claim and all issues are left open for adjudication afresh.

In the result, the appeal filed by the as In the result, the appeal filed by the assessee is allowed for statistical sessee is allowed for statistical purposes.