JUGRAJ SINGH GILL CHARITABLE TRUST,CHANDIGARH vs. COMMISSIONER OF INCOME TAX (EXEMPTIONS), CHANDIGARH

At the outset, the Registry pointed out that there is a delay of 390 days in filing the present appeals. In response, the learned Counsel for the assessee submitted that applications seeking condonation of delay have been filed in both the appeals, which have been taken on record.

The Ld. DR opposed the applications for condonation of delay.

We have heard the rival submissions and perused the applications seeking condonation of delay placed on record. Upon consideration of the facts and circumstances of the case and the reasons explained therein, we are satisfied that the assessee was prevented by sufficient and reasonable

Since the issues involved in both the appeals are identical and the appeals were heard together, they are being disposed of by this consolidated order for the sake of convenience and brevity.

We shall firstly deal with the appeal of the assessee in ITA No. 700/Chd/2026 for A.Y. 2022-23 wherein assessee has raised the following grounds: a) That the Order dated 10.12.2024 passed in Form No. 10AD rejecting the application for registration under Section 12A(1)(ac) (iii) of the Income Tax Act, 1961 by the respondent is bad in law inasmuch as the same is passed in complete breach of principles of natural justice and settled principles of law governing the exercise of a quasi - judicial powers of the respondent in deciding the application for registration under Section 12AB of the Income Tax Act, 1961. b) That the respondent i.e., Commissioner of Income Tax (Exemptions), Chandigarh erred in law as well as on facts in rejecting the application seeking final approval/registration for final registration from AY 2022-23 to AY 2024-2025 [in terms of Section 12A(1)(ac) (iii)] under Section 12AB of the Income Tax Act, 1961 without appreciating facts and law governing the present case properly. c) That the Order dated 10.12.2024 passed in Form No. 10AD rejecting the application for registration under Section 12A(1)(ac)(iii) of the Income Tax Act, 1961 by the respondent is illegal and arbitrary as the same is passed in violation of settled principle of right to notice, so that same be met by the appellant. d) That the judgments relied by the respondent in the impugned Order dated 10.12.2024 are not applicable to the factual matrix of the present case as neither any message of communication via SMS and/or WhatsApp nor any email(s) containing the hearing notices dated 17.10.2024, 12.11.2024, 03.12.2024 nor any communication via email or message regarding uploading of aforesaid notices of hearing on the income tax portal for deciding the application for registration was received by the appellant. e) That the Order dated 10.12.2024 passed in Form No. 10AD rejecting the application for registration under Section 12A(1)(ac) (iii) of the Income Tax Act, 1961 by the respondent is bad in law inasmuch as the application of final approval/registration was not heard on merits, rejection on the solitary reason of absence of the requisite submissions of the appellant in response to the purported hearing letters dated 17.10.2024, 12.11.2024, 03.12.2024 of hearing which was not received by the appellant is wholly illegal and arbitrary. f) That the Order dated 10.12.2024 passed in Form No. 10AD rejecting the application for registration under Section 12A(1)(ac) (iii) of the Income Tax Act, 1961 by the respondent is not tenable in law and on the facts and in the circumstances of the case as the aforesaid notices dated 17.10.2024,

Briefly stated, the assessee trust filed an application in Form No.10AB seeking registration under section 12AB of the Act. During the course of proceedings, the Ld. CIT(E) issued notices calling for various details and documentary evidences relating to the objects of the trust, genuineness of its activities, financial statements and other relevant information. According to the Ld. CIT(E), despite issuance of notices dated 17.10.2024, 12.11.2024 and 03.12.2024, the assessee neither furnished the requisite details nor sought any adjournment. The Ld. CIT(E), therefore, observed that in the absence of requisite information and documentary evidences, it was not possible to verify the genuineness of activities of the trust or examine whether the activities were being carried out in accordance with its stated objects. Accordingly, the application for registration under section 12AB was rejected.

Aggrieved by the aforesaid order, the assessee has preferred the present appeal before the Tribunal.

The Ld. Counsel for the assessee submitted that the impugned order has been passed ex parte and without proper appreciation of the relevant

The Ld. DR relied upon the findings recorded in the impugned order and submitted that sufficient opportunities had been granted by the Ld. CIT(E) but the assessee failed to avail the same. It was accordingly contended that the Ld. CIT(E) was justified in rejecting the application.

We have heard the rival submissions and have carefully perused the material available on record. We find that the application of the assessee has been rejected primarily for want of supporting documents and non- compliance with the notices issued by the Ld. CIT(E). We further find that no conclusive finding has been recorded by the Ld. CIT(E) that the objects of the trust are non-charitable or that the activities carried out by the assessee are not genuine. The rejection has essentially been made because the requisite details and evidences were not available before the Ld. CIT(E) for examination.

1 The provisions of section 12AB require the Ld. CIT(E) to satisfy himself regarding the genuineness of the activities of the trust and the compliance of such activities with its stated objects. Such satisfaction can be arrived at only after examination of the relevant material and evidences. In a case where the application has been rejected solely on account of non-compliance and without examining the material which the assessee claims to possess and 5 intends to produce, the ends of substantial justice would require that one more effective opportunity be afforded to the assessee.

2 Considering the totality of facts and circumstances of the case, and in the interest of substantial justice, we deem it appropriate to set aside the impugned order passed by the Ld. CIT(E) and restore the matter to his file for fresh adjudication. The assessee shall furnish all requisite details, documentary evidences, books of account, activity reports, financial statements and such other information as may be called for by the Ld. CIT(E). The Ld. CIT(E) shall thereafter examine the application afresh in accordance with law and pass a speaking order after providing reasonable and adequate opportunity of hearing to the assessee.

3 The assessee is directed to extend full cooperation during the remand proceedings and shall not seek unnecessary adjournments. Failure to comply with the notices and directions issued by the Ld. CIT(E) shall entitle the Ld. CIT(E) to proceed in accordance with law on the basis of material available on record.

4 In view of the above, the impugned order is set aside and the matter is restored to the file of the Ld. CIT(E) for de novo adjudication in accordance with law.

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

Since we have adjudicated the issues involved in the lead appeal in ITA No.700/Chd/2026 in the foregoing paragraphs, and the facts, issues involved, grounds raised and the reasons recorded by the Ld. CIT(E) in the connected appeal bearing ITA No.701/Chd/2026 are identical and arise out of the same set of facts and circumstances, our findings and conclusions rendered in the lead appeal shall apply mutatis mutandis to the present appeal as well. Accordingly, following our decision in ITA No.700/Chd/2026, we set aside the impugned order passed by the Ld. CIT(E) in relation to the assessee's application for approval under section 80G of the Act and restore the matter to his file for fresh adjudication in accordance with law. The Ld.

In the result, both the above appeals are allowed for statistical purposes.

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