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Facts
The assessee filed an appeal against the CIT(E)'s order, which condoned the delay in filing the appeal and registration. The delay was attributed to the assessee's unawareness of tax provisions and communication issues regarding the rejection of their Form 10 AD application.
Held
The Tribunal condoned the delay, stating that it was beyond the assessee's control and that granting an opportunity in the interest of justice would allow the school to function smoothly. The CIT(E) was directed to grant a reasonable opportunity of being heard.
Key Issues
Whether the delay in filing the appeal against the order rejecting registration under Section 12AA should be condoned. Whether the assessee was prevented from filing the appeal within the stipulated time due to circumstances beyond their control.
Sections Cited
12AA, 10AD, 12A(1)(ac)(iv), 80G(5)
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Income Tax Appellate Tribunal, “A” BENCH : BANGALORE
Before: SHRI. LAXMI PRASAD SAHU & SHRI. SOUNDARARAJAN K
Per Laxmi Prasad Sahu, Accountant Member :
This appeal is filed by the assessee against Order passed by the CIT(E) for not condoning the delay of 560 days in filing the appeal and not granting registration under section 12AA of the Act.
Regarding condonation of delay, assessee has filed affidavit in support of its condonation petition which is placed at Paper Book Page Nos.15 to 22 stating therein reasons as under:
“4. The due date for filing this appeal was 12- August 2023. However the appeal was not filed before 60 days from the date of service of order as required under law. And there is a delay of 645 days as on 19' March 2025.
Page 2 of 4 The applicant submits that this delay is caused due to the fact that the applicant was unaware about the provisions of income tax act and consequences of the order of rejection passed in Form 10 AD by the CIT (Exemptions). Also, CA Sunil Kumar Jain who handled the matter had not received the communication of the order till 6th Jan 2025. The circumstance prevented the Appellant from preparing and filing the appeal before 12th August 2023. In the facts and circumstances of the case, the applicant submits they were prevented from filing the appeal within the given time under law beyond their control. The applicant is providing an Affidavit to confirm the reason for the delay in filing the appeal and the same is enclosed to this application.”
8. That the issuance of Form 10 AD dated 13/06/2023 on the income tax portal was noticed by the CA Sunil Kumar Jain on 6th Jan 2025 when he was taking the update from me regarding the application communications. He communicated to me regarding the fact that the order of rejection is issued in Form 10 AD and that the remedy for the same (that is filing an appeal / revision) is time barred. This fact was also communicated to me by email on the same date 6th Jan 2025. He also asked his staff to see office number and realised the fact that the order being sent to his office general number is accurate. Once I received the communication from CA Sunil Kumar Jain I came to know that a hearing notice dated 26/05/2023 was also sent to us by speed post.
CA Sunil Kumar lain communicated to me that in the face of conflict of interest he will not agree to represent the society before any appellate / revisionary authorities in respect of this matter.
Consequently we have reached out to other professionals seeking services and CA Pooja Karaveershettar has consented to appear on our behalf to prepare and file an appeal. 11. All the above events that occurred were beyond my control that led to the delay in filing an appeal before the Hon'ble ITAT. I implore Ld members to admit the appeal and hear the case on merits in the end of natural justice. The condoning of delay in the interest of justice will go a long way in enabling the school function smoothly and keep building the much needed quality education for kids in the village. 3. Considering the reasons for delay in filing the appeal stated above and relying on the judgment of the Hon’ble Supreme Court in the case of Collector of Land Acquisition Vs. MST Katiji and Others, (1987) 2 SCC 107 : 1987 (2) SC, the delay in filing the appeal is condoned.
The learned Counsel submitted that the assessee is a society registered under the Karnataka Society Act, 1960, and also registered with Public Education Department under Government of Karnataka and the assessee is also registered under section 12A(1)(ac)(iv) of the Actin Form 10AC vide registration No.AAEAC1477AE20219 having validity of registration till Assessment Year 2026-27. The society is running an English medium school called Chiguru Srujana School in the district of Mysuru, Karnataka. Form 10AB for approval under section 80G(5) of the Act was filed on 02.12.2022. The CIT(E) issued 2 noticed to submit details / documents and notice of hearing was uploaded online in income tax portal but due to non usage of income tax portal, notice could not been seen and the email id shivappakote@gmail.com provided was not accessible by any of the members of the society for some technical reasons, therefore, all the notices sent on this email id went unnoticed by the members / office bearers. On 14.03.2025, the new email id chigurukote@gmail.com is added on the income tax portal for future communications.
Form 10AD received on 19.06.2023 by speed post was noticed by the Chartered Accountant Sunil Kumar Jain on 06.01.2025 and he uploaded regarding the communications and it was noticed that Form 10AD has been passed and the application filed by the assessee was rejected and hence it was requested that one more opportunity may be granted to the assessee and undertook that the assessee will provide necessary documents to substantiate its case.
On the other hand, learned DR relied on the Order of lower authorities and submitted that assessee was granted sufficient time. There is no mistake on the part of learned CIT(E).
Page 4 of 4 7. Considering the rival submissions and facts mentioned as above, we deem it appropriate to grant one more chance to the assesse to present its case. The ld. CIT(E) is directed to give reasonable opportunity of being heard to the assessee and decide the issue as per law. Assessee is directed to submit requisite documents in support of its claim and not to seek unnecessary adjournments and facilitate early disposal of the case. In case of failure, no second leniency shall be granted to the assessee.
In the result, appeal filed by the assessee is allowed for statistical purposes.
Pronounced in the court on the date mentioned on the caption page.