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Facts
The assessee trust filed an appeal challenging the rejection of its application for registration under Section 10AB. There was a delay in filing the appeal, which the assessee attributed to notices going into a spam folder.
Held
The Tribunal condoned the delay, acknowledging the lack of effective service of orders due to the spam folder issue. The matter was restored to the CIT(E) for a fresh decision on merits, ensuring the assessee gets a proper opportunity to present its case.
Key Issues
Whether the delay in filing the appeal should be condoned? Whether the application for registration under Section 10AB should be decided afresh after providing an opportunity to the assessee?
Sections Cited
10AB, 12A(1)(ac)(iii), 12 AB
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Income Tax Appellate Tribunal, “F” BENCH MUMBAI
Before: SHRI SANDEEP GOSAIN & SHRI PRABHASH SHANKAR
ORDER
PER SANDEEP GOSAIN, JM:
The present appeal has been filed by the assessee trust challenging the impugned order dated 21.09.2024, rejection of application 10AB u/s 12A(1)(ac)(iii) of the Income Tax Act, 1961 (‘the Act’), by the Ld. Commissioner of Income Tax (Exemptions), Mumbai (‘Ld. CIT(E)’), for the assessment year 2024-25.
At the very outset, we noticed that there is a delay in filing the present appeal and in this regard Ld.AR while 2 drawing our attention to the contents of the application for seeking condonation of delay, submitted that the notice issued by the department went to spam folder and thus assessee could not come to know about the passing of the impugned orders by Ld. CIT(E)In support of his submissions, Ld.AR also relied upon affidavit of the assessee .
On the other hand, Ld DR submitted that it was assesses own negligent conduct for not pursuing the proceedings diligently before the Ld CIT (E) and there is no sufficient cause for condoning the delay. Therefore, requests for dismissal of application for seeking condonation of delay.
After having heard counsels for both the parties on the application for seeking condonation of delay, we are of the view that since there was no effective service of orders upon the assessee as the order sent by the department went to spam folder. Therefore, assessee could not come to know regarding the passing of the orders by Ld CIT(E). Thus, keeping in view the principles laid down by Hon’ble Supreme Court in the case of Land Acquisition Collector Vs. Mst katiji, 1987, AIR, Supreme Court, 1353 and also keeping in view the contents of the application for seeking condonation of delay, and also accompanied by a detailed affidavit of the assessee, we condone the delay in filing the present appeal and thus the appeal is admitted to be heard on merits.
3 5. We notice that the application for seeking registration under section 12 AB of the Income tax Act was rejected by the Ld.CIT (E) on the ground that assessee had not submitted the required documents and in this regard Ld. DR has drawn our attention to the fact that two times notices in this regard were issued and still the assessee could not submit the required documents. Therefore, in the absence of those documents, the application for seeking registration by the assessee was rejected.
In this regard Ld AR submitted that he had already annexed all the required documents along with the application for seeking registration under section 12 AB of the IT Act. However, he further submitted that notices issued by the Ld. CIT (E) were not received by the assessee as the same went to the spam folder and were not within the notice and knowledge of the assessee, otherwise assessee would have complied with the same. It was further submitted that still assessee is ready to file all the required documents before the Ld. CIT(E).
Be that as it may, in our view, the interest of justice would be met in case the issue between the parties is decided on merits after providing fair opportunity of hearing to both the parties. Therefore, considering the above factual position, the bench is of the view that the ends of justice would be met only if the matter is restored back to the file of Ld. CIT(E). In case proper and sufficient opportunity is not given to the 4 assessee, to submit all the details then in that eventuality the rights of the assessee shall be prejudiced. Thus, keeping in view the above position, the present appeal of the assessee is restored to the file of Ld. CIT (E) for deciding it afresh on merits. After considering allthe documents, if any, filed by the assessee and after providing due opportunity of hearing. The assessee shall not seek any adjournment on frivolous grounds and remain cooperative during the course of proceedings.
Before parting, we make it clear that our decision to restore the matter back to the file of Ld. CIT (E), shall in no way, be construed as having any reflection or expression on the merits of the issue, which shall be adjudicated by Ld. CIT(E) independently in accordance with law.
In the result the appeal filed by the assessee is allowed for statistical purposes.