COMMISSIONER OF INCOME TAX, (EXEMPTIONS), HYDERABAD vs. COMMUNITY DEVELOPMENT FOUNDATION, HYDERABAD

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ITA 850/HYD/2019Status: DisposedITAT Hyderabad27 September 2019AY 2019-203 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal set aside the order of the CIT(E) and remanded the matter back for fresh consideration. The CIT(E) was directed to issue a fresh notice to the assessee and provide a fair opportunity of hearing.

What were the facts?

The assessee applied for registration under Section 12AA of the IT Act. The CIT(E) rejected the application as the notice sent to the assessee was returned unserved and the assessee failed to appear or provide necessary documents.

What were the issues?

Whether the CIT(E) was justified in rejecting the registration application without affording a proper opportunity to the assessee, especially when the notice was returned unserved.

Which sections of the Income-tax Act were involved?

Section 12AA

AI-generated summary — verify with the full judgment below

Before: SMT. P. MADHAVI DEVI & SHRI A. MOHAN ALANKAMONY

For Appellant: Shri M.V. Anil Kumar
For Respondent: Smt. Nivedita Biswas
Hearing: 24/09/2019Pronounced: 27/09/2019

IN THE INCOME TAX A PPELLATE TRIBUNAL HYDERABAD BENCH ‘A', HYDERABAD BEFORE SMT. P. MADHAVI DEVI, JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ITA No. 850/Hyd/2019 Assessment Year: 2019-20 Community Development vs. Commissioner of Income-tax Foundation, Hyderabad. (Exemptions), Hyderabad. PAN – AACTC 2190H Appellant Respondent Assessee by: Shri M.V. Anil Kumar Revenue by: Smt. Nivedita Biswas Date of hearing: 24/09/2019 Date of pronouncement: 27/09/2019 O R D E R PER SMT. P. MADHAVI DEVI, J.M.: This is an appeal filed by the assessee against the order of CIT(E), Hyderabad dated 05/12/2018, rejecting the assessee’s application for registration u/s 12AA of the IT Act.

2.

Brief facts of the case are that the assessee submitted its application in Form No. 10A for registration u/s 12A of the IT Act on 23/06/2018. The CIT(E) issued a notice dated 19/11/2018 to the assessee to appear on or before 05/12/2018and produce its original Memorandum of Association (MoA)/Trust Deed for verification and to furnish a detailed reply on specific points. The said letter was returned unserved by the Postal Department with an endorsement “No such CDF at this address”. Therefore, the CIT(E) observed that existence of the assessee’s trust is in doubt and he also observed that as per rule 17A, the assessee has to file copy of income and expenditure account. Since assessee did not

2 I.T.A. No. 850/Hyd/19 Community Development Foundation, Hyd.

appear and did not file the necessary details before him, the CIT(E) held assessee has violated rule 17A and has not produced bills/vouchers and books of account for verification and hence, he rejected the assessee’s application for registration u/s 12AA of the Act.

3.

Aggrieved by the order of CIT(E), the assessee is in appeal before us stating that the CIT(E) ought to have allowed one more opportunity to the assessee to support the application with necessary evidence, before rejecting the application for registration u/s 12A and also stated that CIT(E) rejected the application without going through the relevant material. Ld. Counsel for the assessee prayed for setting aside the order of CIT(E) and directions to be given to CIT(E) to decide the issue afresh.

4.

Ld. DR, on the other hand, opposed the submissions the ld. AR, but, stated that he had no objection for remanding the matter back to the file of CIT(E).

5.

After considering the submissions of both the sides and considering the facts of the case, we deem it fit and proper to set aside the order of CIT(E), and remand the matter back to his file with a direction to reconsider the issue on merits after giving fresh notice to the assessee to the address given in Form No. 36, through which the appeal was filed before the Tribunal. The assessee is also directed to cooperate with the CIT(E) by filing all the necessary documents for verification. We also make it clear that CIT(E) is required to look into the objectives of the assessee trust alone while granting registration u/s 12A of the Act. With these observations, the CIT(E) is directed to reconsider the assessee’s application in

3 I.T.A. No. 850/Hyd/19 Community Development Foundation, Hyd.

accordance with law after giving fair opportunity of hearing to the assessee in the matter.

6.

In the result, appeal of the assessee is treated as allowed for statistical purposes. Pronounced in the open court on 27th September, 2019.

Sd/- Sd/- (A. MOHAN ALANKAMONY) (P. MADHAVI DEVI) ACCOUNTANT MEMBER JUDICIAL MEMBER

Hyderabad, dated 27th September, 2019. kv Copy forwarded to: 1. Community Development Foundation, C/o M. Anandam & Co., CAs., Flat No. 7A, Surya Towers, SP Road, Secunderabad. 2. CIT(E), 2nd Floor, Aayakar Bhavan, Basheerbagh, Hyderabad. 3. ITO(E) - 1, Hyderabad. 4. The DR, ITAT, Hyderabad 5. Guard File

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