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Facts
The appellant, Hira Mehta Charitable Trust, applied for final registration under Section 80G of the Income Tax Act, having previously received provisional registration. The CIT(E) rejected the application citing failure to meet stipulated conditions and not claiming exemption in previous years.
Held
The Tribunal held that the CIT(E) rejected the application without specifying the unfulfilled conditions and denied the appellant a fair opportunity to present their case, especially considering the provisional registration granted.
Key Issues
Whether the rejection of the final registration application under Section 80G was justified without affording a fair opportunity to the assessee, and if the CIT(E) properly considered the provisional registration granted.
Sections Cited
80G, 80G(5)(iv)(B)
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Income Tax Appellate Tribunal, Mumbai “E” Bench, Mumbai.
Before: Shri Sandeep Gosain (JM) & Shri Omkareshwar Chidara (AM)
4. The appellant Prays that: • The order dated 31.08.2024 passed by the CIT (Exemption) be set aside. • Direct the CIT (Exemption) to grant final approval within a time bound period.
2 Hira Mehta Charitable Trust • Such order rectify as may be demand appropriate in the facts and circumstances.
Thus, the main grievance of the appellant is that they were not able to present any additional documents/clarification, especially when the Ld. CIT(Exemption) has granted provisional registration under section 80G of the I.T. Act which is valid till A.Y. 2026-27.
The Ld. AR of the appellant has submitted during the course of hearing, that the order of rejecting the application u/s. 80G of the Act was very cryptic without mentioning which stipulated conditions were not fulfilled.
Ld. DR relied on the order of Ld. CIT(E).
Both parties are heard. Para 4 which is the operative portion of Ld. CIT(E) order, is reproduced as under :- 4. As per above mentioned provision of Income Tax Act, the assessee has to file Form 10AB u/s 80G(5)(iv)(B), if the assessee has not claimed exemption in previous year. Since the assessee has claimed exemption in previous years, therefore this application u/s 80G is not allowable. Further, the assessee is not fulfilling the stipulated conditions prescribed for filing application for approval in Form 10AB. In view of the above this application Form is hereby rejected.
From the above, it is seen that the Ld. CIT(E) has rejected the application for seeking registration u/s. 80G of the Act without mentioning which stipulated conditions prescribed for filing application for approval in Form 10AB of the Act were not fulfilled. Moreover, it appears from the grounds of appeal filed by the appellant, their submission was only to grant an opportunity to explain that all the required conditions were fulfilled. The principles of natural justice require that the appellant should be given to explain the legal provisions, especially when the Department has already granted provisional registration u/s. 80G of the Act till A.Y. 2026-27. The Ld. CIT(E) is directed to grant reasonable opportunity to produce the documents/clarifications, the appellant wants to submit, and take a decision as per law. The matter is remitted to the file of Ld. CIT(E) as above.
3 Hira Mehta Charitable Trust
The appellant is allowed for statistical purposes.
Order pronounced in the open Court on 03/03/2025.