SHRI ISHWARIYA GRAMYA VIKAS MANDAL,AMRELI vs. CIT(EXEMPTION),AHMEDABAD, AHMEDABAD

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ITA 409/AHD/2026Status: DisposedITAT Ahmedabad23 June 20264 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal held that the interests of justice would be served by remanding the matter back to the CIT(E) for a fresh consideration of the application. The assessee should be given an opportunity to submit its explanations and submissions.

What were the facts?

The assessee, a Trust, applied for registration under section 12A(1)(ac)(iii) of the Income Tax Act. The application was rejected by the CIT(E) for non-compliance with show cause notices and failure to explain the genuineness of activities.

What were the issues?

Whether the CIT(E) erred in rejecting the registration application solely on procedural non-compliance without adjudicating on merits, and if the principles of natural justice were violated.

Which sections of the Income-tax Act were involved?

Section 12A(1)(ac)(iii),Section 12AB

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “C” BENCH, AHMEDABAD

Before: DR. B.R.R. KUMAR, VICE- & SHRI RAHUL CHAUDHARY

For Appellant: Shri Hatim Bharmal, AR
For Respondent: Shri Rajneesh Yadav, CIT. DR
Hearing: 17.06.2026Pronounced: 23.06.2026

PER DR. B.R.R. KUMAR, VICE-PRESIDENT:-

Delay Condoned The captioned appeal has been filed by the assessee against the order passed by the Learned Commissioner of Income Tax (Exemption), Ahmedabad dated 30.10.2025, whereby the application of the assessee for registration under section 12A(1)(ac)(iii) of the Income Tax Act, 1961 was rejected.

ITA No.409/Ahd/2026 Asst. Year : NA - 2–

2.

The assessee has raised the following grounds of appeal:

That the Learned Commissioner of income tax (Exemptions), Ahmedabad has erred in law and on facts in rejecting the Appellant Trust's application for registration under Section 12A(1)(ac)(i) read with Section 12AB of the income-tax Act, 1961, solely on the ground of alleged non-compliance with show cause notices, without adjudicating the application on merits. That the impugned order is bad in law, arbitrary and unsustainable, inasmuch as all basic and mandatory documents required for verification under Section 12AB and Rule 17A, including the past audit reports, Trust Deed, Trust registration certificate, NO, and NO, were already submitted along with Form No. 10AB at the time of filing of the application. That the Learned CIT(E) failed to appreciate that only replies to the show cause notices were not submitted, whereas the foundational documentary evidence necessary to verify the objects, genuineness of activities and statutory compliance of the Trust was already available on record, and therefore the application could and ought to have been decided on the basis of the material already furnished. That rejection of the application merely on account of non-reply to show cause notices, without examination of the documents already submitted, amounts to elevating procedural non-compliance over substantive justice, which is impermissible in proceedings (elating to grant of registration to charitable or religious trusts That the Learned CIT(E) was fully empowered to examine and verify the documents already uploaded along with the application under Form No. 10AB and to record satisfaction or otherwise regarding the genuineness of activities and objects of the Trust, and more non-response to portal-based notices could not have been treated as conclusive ground for rejection without such verification. That in the absence of actual knowledge of issuance of show cause notices, no adverse inference ought to have been drawn against the Appellant Trust and passing of the impugned order without ensuring effective service amounts to violation of principles of natural justice. That the non-submission of replies was neither deliberate nor with any intention to suppress facts or withhold information, and there is no finding in the impugned order disputing the charitable or religious nature of the objects or the genuineness of activities of the Trust

ITA No.409/Ahd/2026 Asst. Year : NA - 3–

That the impugned rejection has caused grave prejudice to the Appellant Trust and the same deserves to be set aside, and the matter be restored to the file of the Learned CIT(E) for fresh adjudication on merits after granting a reasonable and effective opportunity of being heard and permitting submission of replies and explanations, if required. That the Appellant craves leave to add to, alter, amend or withdraw any of the above grounds at or before the time of hearing

3.

The facts of the case are that the assessee is a Trust and had applied for registration under Form No.10AB of the Act. The Ld. CIT(E) rejected the application for registration u/s.12AB(1)(b)(ii)(B) of the I.T Act, 1961, since the assessee-trust remained non-compliant and failed to submit/explain genuineness of the activities of the Trust.

4.

Aggrieved by the order of the Ld. CIT(E), the Assessee filed appeal before the Tribunal.

5.

At the outset, we find that notices were issued from time to time to furnish details/documents as called for. The Ld.CIT(E) rejected the application of the assessee on the ground that that the assessee-trust has neither filed any submission nor sought any adjournment. Therefore, the Ld. Counsel prayed that given an opportunity, the same would be apprised to the Ld.CIT(E). Ld. CIT(DR) argued that the assessee-trust needs to furnish requisite details/explanations and submissions before the Ld. CIT(E). Having considered the facts on record, we hold that interests of justice would be well served by remanding the matter to the Ld. CIT(E) for consideration of the application afresh and to pass an order by taking into consideration the submissions /explanations submitted by the assessee.

ITA No.409/Ahd/2026 Asst. Year : NA - 4–

6.

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

The order is pronounced in the open Court on 23.06.2026

Sd/- Sd/- (RAHUL CHAUDHARY) (DR. B.R.R. KUMAR) JUDICIAL MEMBER VICE-PRESIDENT (True Copy) Ahmedabad; Dated 23.06.2026 MV

आदेश की �ितिलिप अ�ेिषत/Copy of the Order forwarded to : अपीलाथ� / The Appellant 1. 2. ��थ� / The Respondent. 3. संबंिधत आयकर आयु� / Concerned CIT 4. आयकर आयु�(अपील) / The CIT(A)- 5. िवभागीय �ितिनिध, आयकर अपीलीय अिधकरण, अहमदाबाद / DR, ITAT, Ahmedabad 6. गाड� फाईल / Guard file.

आदेशानुसार/ BY ORDER, True Copy सहायक पंजीकार (Dy./Asstt. Registrar) आयकर अपीलीय अिधकरण, अहमदाबाद / ITAT, Ahmedabad

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