MACRO FOUNDATION TRUST,AHMEDABAD vs. CIT (EXEMPTION), AHMEDABAD, AHMEDABAD

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ITA 1201/AHD/2026Status: DisposedITAT Ahmedabad18 May 2026AY 2027-288 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal held that the assessee should be given another opportunity to furnish documents for 12A registration. Since the 80G approval was rejected based on the 12A registration, that matter was also restored for fresh adjudication.

What were the facts?

The assessee trust applied for renewal of registration under Section 12A/12AB and approval under Section 80G. The CIT(E) rejected both applications for non-compliance with documentation requirements and lack of valid 12A registration, respectively.

What were the issues?

Whether the rejection of 12A registration and 80G approval was justified without providing sufficient opportunity to the assessee, and if the 12A registration is a prerequisite for 80G approval.

Which sections of the Income-tax Act were involved?

Section 12A,Section 12AB,Section 80G

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “A” BENCH, AHMEDABAD

Before: SHRI SIDDHARTHA NAUTIYAL & SHRI NARENDRA PRASAD SINHA

For Appellant: Shri Maulin Shah, AR
For Respondent: Shri Prem Prakash Meena, CIT-DR
Hearing: 14.05.2026Pronounced: 18.05.2026

IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, AHMEDABAD BEFORE SHRI SIDDHARTHA NAUTIYAL, JUDICIAL MEMBER & SHRI NARENDRA PRASAD SINHA, ACCOUNTANT MEMBER I.T.A. Nos.1200&1201/Ahd/2026 (Assessment Year: 2027-28) Macro Foundation Trust, Vs. Commissioner of 9, Golden Tulip Bungalow, Income Tax (Exemption), Opp. Shreyas School, Ambawadi, Ahmedabad Ahmedabad-380015 [PAN No.AACTM8237B] (Appellant) .. (Respondent) Appellant by : Shri Maulin Shah, AR Respondent by: Shri Prem Prakash Meena, CIT-DR Date of Hearing 14.05.2026 Date of Pronouncement 18.05.2026 O R D E R PER SIDDHARTHA NAUTIYAL - JUDICIAL MEMBER: Both appeals have been filed by the Assessee against the order passed by the Ld. Commissioner of Income Tax (Exemption), (in short “Ld. CIT(E)”), Ahmedabad vide orders dated 08.03.2026. Since common facts and issues for consideration are involved for both the appeals before us, both the appeals are being disposed by way of a common order.

2.

The assessee has taken the following grounds of appeal: ITA No. 1200/Ahd/2026 “1. The learned CIT (Exemption) erred in law by failing to give sufficient opportunity to file documentary evidences / submissions and only giving one email letter on 15/02/2026, which was missed by the trustee due to inadvertent oversight, and hence violation of principle of natural justice in rejecting renewal application u/s 12A.

ITA Nos. 1200&1201/Ahd/2026 Macro Foundation Trust vs. CIT(E) Asst. Year –2027-28 - 2– 2. The learned CIT(Exemption) erred in law and on facts rejected renewal application u/s 12A without giving show cause notice and hence required to be remanded back to CIT (Exemption). 3. The learned CIT (Exemption) ought to have seen that the Trust has been in existence since 2010, already registered u/s 12A and u/s 80G since 07/05/2011 and renewed till AY 2026-27, and hence rejection of renewal application u/s 12A without giving opportunity is bad in law. 4. The learned CIT (Exemption) ought to have seen that appellant had already filed Trust Dee, Charity Commissioner Certificate, Approval u/s 12AA and u/s 80G from Income Tax Department, 3 years audited financial statements and hence rejection of renewal application u/s 12A is bad in law without providing any adverse remarks or observations. 5. The learned CIT (Exemption) ought to have been that under proviso to section 12AA(1A) for procedure of registration, it is clearly written that no order shall be passed unless the applicant has been given a reasonable opportunity and hence rejection order is required to be quashed. 6. The Appellant prays to be allowed to add, amend, modify, rectify, delete, raise any grounds of appeal at the time of hearing. 7. The Appellant prays leave to adduce such further evidence to substantiate its case, as the occasion may be demand.” We shall first take up the appeal relating to rejection of approval under section 12A of the Act

3.

The brief facts of the case are that the assessee trust, namely MACRO FOUNDATION TRUST, filed an application in Form No.10AB seeking registration under section 12A/12AB of the Income-tax Act, 1961 ("the Act"). The application was filed before the ld. CIT(Exemptions), Ahmedabad and was required to be examined in terms of section 12AB(1)(b) of the Act read with Rule 17A of the Income-tax Rules, 1962, which governs the procedure for fresh registration and prescribes the documents and evidences required to be furnished for the purpose of satisfying the prescribed authority regarding the genuineness of

ITA Nos. 1200&1201/Ahd/2026 Macro Foundation Trust vs. CIT(E) Asst. Year –2027-28 - 3– activities of the trust and the conformity of such activities with the stated charitable objects.

4.

During the course of proceedings, the ld. CIT(Exemptions) issued notice dated 15.02.2026, calling upon the assessee to furnish requisite details, documentary evidences and supporting material as prescribed under Rule 17A(2) of the Income-tax Rules, 1962. However, according to the ld. CIT(Exemptions), the assessee neither furnished any submissions / details / documents in response to the notices issued nor sought any adjournment in the matter. The ld. CIT(Exemptions) accordingly observed that in absence of supporting documentary evidences, he was unable to satisfy himself regarding (i) the genuineness of the activities of the trust or institution, (ii) whether the activities were being carried out in consonance with the objects of the trust, and (iii) whether other laws material for achieving the charitable objects had been complied with. Proceeding on the aforesaid basis, the ld. CIT(Exemptions) rejected the application filed in Form No.10AB under section 12AB of the Act vide order dated 08.03.2026 and further cancelled the provisional registration, if any, granted earlier to the assessee. The ld. CIT(Exemptions) also directed the assessee to compute its tax liability under section 115TD of the Act read with Rule 17CB of the Income-tax Rules and comply with the consequential statutory requirements prescribed thereunder.

5.

The assessee is in appeal before us against the aforesaid order passed by the ld. CIT(Exemptions).

ITA Nos. 1200&1201/Ahd/2026 Macro Foundation Trust vs. CIT(E) Asst. Year –2027-28 - 4– 6. We have heard the rival submissions and perused the material available on record. It is observed that the rejection of registration under section 12AB has primarily been made on account of non-compliance and failure on the part of the assessee to furnish the requisite documents and evidences before the ld. CIT(Exemptions). At the same time, it is also noticed that the matter has been decided without examination of the relevant evidences and supporting material which the assessee now claims to be in a position to furnish before the authorities. The proceedings relating to grant of registration under section 12AB carry significant tax consequences inasmuch as such registration forms the foundation for claiming exemption under sections 11 and 12 of the Act.

7.

We further note that the Coordinate Bench of the Tribunal in the case of Udhna Academy Education Trust in ITA No.970/Ahd/2026 vide order dated 07.05.2026 had restored the issue relating to rejection of registration under section 12AB to the file of the ld. CIT(Exemptions) for de novo adjudication after observing that the assessee should be granted one more effective opportunity to furnish the requisite documents and establish the genuineness of its activities and objects.

8.

Having regard to the entirety of facts and in the interest of substantial justice, we are of the considered view that the assessee deserves one more opportunity to substantiate its claim for registration under section 12AB of the Act. Accordingly, we set aside the impugned order passed by the ld. CIT(Exemptions) dated 08.03.2026 and restore the matter to his file for fresh adjudication in accordance with law. The ld. CIT(Exemptions)

ITA Nos. 1200&1201/Ahd/2026 Macro Foundation Trust vs. CIT(E) Asst. Year –2027-28 - 5– shall examine the application afresh after providing reasonable opportunity of being heard to the assessee. The assessee is also directed to furnish all requisite documents, evidences and details as prescribed under Rule 17A(2) of the Income-tax Rules, 1962 and fully cooperate in the proceedings without seeking unnecessary adjournments. Needless to clarify, the ld. CIT(Exemptions) shall adjudicate the issue independently on merits in accordance with law after examining the genuineness of activities and the objects of the trust.

9.

In the result, the appeal of the assessee relating to rejection of registration under section 12AB of the Act is allowed for statistical purposes.

We shall now take up the appeal relating to rejection of approval under section 80G(5) of the Act

10.

The assessee has raised the following grounds of appeal:

ITA No. 1201/Ahd/2026 “1. The learned CIT (Exemption) erred in law and on facts in rejecting renewal application u/s 80G(5) on the ground that Trust does not have a valid order for registration u/s 12A8. 2. The learned CIT(Exemption) wrongly rejected renewal application u/s 80G without giving opportunity to file documentary evidences / submissions and hence violation of principle of natural justice. 3. The learned CIT(Exemption) ought to have seen that the Trust has been in existence since 2010, already registered u/s 12A and u/s 80G since 0710512011 and renewed till AY 2026-27, and hence rejection of renewal application u/s 80G without giving opportunity is bad in law.

ITA Nos. 1200&1201/Ahd/2026 Macro Foundation Trust vs. CIT(E) Asst. Year –2027-28 - 6– 4. The learned CIT(Exemption) ought to have seen that appellant had already filed Trust Deed, Charity Commissioner Certif icate, Approval u/s 12AA and u/s 80G from lncome Tax Department,3 years audited financial statements and hence rejection of renewal application u/s 80G is bad in law without providing any adverse remarks or observations. 5. The learned CIT(E) ought to have seen that under clause (b) of proviso to section 80G(5) for procedure of registration, it is clearly written that no order shall be passed unless the applicant has been given a reasonable opportunity and hence rejection order is required to be quashed. 6. The Appellant prays to be allowed to add, amend, modify, rectify, delete, raise any grounds of appeal at the time of hearing. 7. The Appellant prays leave to adduce such further evidence to substantiate its case, as the occasion may demand.” 11. The brief facts relating to this issue are that the assessee filed an application in Form No.10AB seeking approval under section 80G(5) of the Income-tax Act, 1961 before the ld. CIT(Exemptions), Ahmedabad. During the course of proceedings, the ld. CIT(Exemptions) observed that the assessee did not possess a valid registration under section 12A/12AB of the Act either in the form of a regular registration order in Form No.10AD or a valid provisional registration in Form No.10AC. The ld. CIT(Exemptions) accordingly held that registration under section 12A/12AB is a mandatory pre-condition for grant of approval under section 80G(5) of the Act. Reliance was placed upon the judgment of the Hon’ble Gujarat High Court in CIT (Exemptions) v. Shree Tapeshwar Hanumanji Bajrang Charity Trust wherein it was held that in absence of valid registration under section 12A, approval under section 80G cannot be granted. Accordingly, the ld. CIT(Exemptions) rejected the application filed under section 80G(5) as non-maintainable.

ITA Nos. 1200&1201/Ahd/2026 Macro Foundation Trust vs. CIT(E) Asst. Year –2027-28 - 7– 12. The assessee is in appeal before us against the aforesaid order.

13.

We have considered the facts of the case and the material available on record. We find that the rejection of approval under section 80G(5) has been made solely on the ground that the assessee did not possess valid registration under section 12A/12AB of the Act. However, while adjudicating the connected appeal relating to registration under section 12AB hereinabove, we have already restored the matter to the file of the ld. CIT(Exemptions) for fresh adjudication. Therefore, the very foundation on which the approval under section 80G has been rejected presently no longer survives and the issue relating to section 80G approval becomes consequential and intrinsically linked to the outcome of registration proceedings under section 12AB.

14.

We further note that in identical circumstances, the Coordinate Bench of the Tribunal in the case of Udhna Academy Education Trust in ITA No.971/Ahd/2026 vide order dated 07.05.2026 restored the issue relating to rejection of approval under section 80G of the Act to the file of the ld. CIT(Exemptions) for fresh adjudication after deciding the issue of registration under section 12A/12AB.

15.

Accordingly, following the same reasoning and in the interest of justice, we set aside the impugned order passed by the ld. CIT(Exemptions) rejecting the application under section 80G(5) of the Act and restore the matter to his file for de novo adjudication in accordance with law. The ld. CIT(Exemptions) shall reconsider the assessee’s

ITA Nos. 1200&1201/Ahd/2026 Macro Foundation Trust vs. CIT(E) Asst. Year –2027-28 - 8–

application for approval under section 80G(5) afresh after adjudicating the issue relating to registration under section 12AB and after providing adequate opportunity of being heard to the assessee.

16.

In the result, the appeal of the assessee relating to rejection of approval under section 80G(5) of the Act is allowed for statistical purposes.

17.

In the combined result, both the appeals of the assessee are allowed for statistical purposes. This Order is pronounced in the Open Court on 18/05/2026

Sd/- Sd/- (NARENDRA P. SINHA) (SIDDHARTHA NAUTIYAL) ACCOUNTANT MEMBER JUDICIAL MEMBER Ahmedabad; Dated 18/05/2026 TANMAY, Sr. PS TRUE COPY आदेश की �ितिलिप अ�ेिषत/Copy of the Order forwarded to : 1. अपीलाथ� / The Appellant 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,

उप/सहायक पंजीकार (Dy./Asstt.Registrar) आयकर अपीलीय अिधकरण, अहमदाबाद / ITAT, Ahmedabad

1.

Date of dictation 14.05.2026 (Dictated on dragon software) 2. Date on which the typed draft is placed before the Dictating Member 14.05.2026 3. Other Member………………… 4. Date on which the approved draft comes to the Sr.P.S./P.S 15.05.2026 5. Date on which the fair order is placed before the Dictating Member for pronouncement 18.05.2026 6. Date on which the fair order comes back to the Sr.P.S./P.S 18.05.2026 7. Date on which the file goes to the Bench Clerk 18.05.2026 8. Date on which the file goes to the Head Clerk…………………………………... 9. The date on which the file goes to the Assistant Registrar for signature on the order…………………….. 10. Date of Dispatch of the Order……………………………………

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