Loading judgment…
Facts
The assessee filed applications for registration under Section 12AB and approval under Section 80G. The CIT(E) rejected both applications, stating that the assessee failed to provide sufficient evidence of its activities and did not respond to notices. The assessee cited illness of a trustee as the reason for not responding.
Held
The Tribunal noted that opportunities were given but the assessee did not respond on the scheduled date, though a medical certificate was submitted. Considering the facts and in the interest of justice, one more opportunity is granted to the assessee to prove the genuineness of its activities.
Key Issues
Whether the assessee was granted sufficient opportunities and whether the illness of a trustee constitutes a reasonable cause for non-compliance, warranting another opportunity for the assessee to prove the genuineness of its activities.
Sections Cited
12AB, 80G, 80G(5)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “B” BENCH : BANGALORE
Before: SHRI. LAXMI PRASAD SAHU & SHRI. SOUNDARARAJAN K
Per Laxmi Prasad Sahu, Accountant Member :
Both these appeals filed by the assessee against the separate Orders passed by the CIT(E) in Form 10AD vide DIN and Notice Nos.ITBA/EXM/F/EXM45/2024-25/1071347013(1) and ITBA/EXM/F/ EXM45/2024-25/1071347039(1), both Orders dated 18.12.2024 , for not granting registration under section 12AB of the Act and not granting approval under section 80G(5) of the Act, respectively. Assessee filed Form No.10AB dated 29.06.2024 for registration under section 12AB of the Act and approval under section 80G of the Act. Assessee was granted opportunities on 01.11.2024 and 10.12.2024 for substanting its case. Assessee was granted provisional , 273/Bang/2025 Page 2 of 4 registration on 07.04.2022 for Assessment Years 2022-23 to 2024-25 under section 12AB of the Act. As per the notice, assessee was required to submit the requisite documents. However, assessee did not submit any proof or evidence of activities of the Trust. Accordingly, it was concluded that the assessee has not commenced its activities towards attainment of the objectives. The learned Counsel submitted that the assessee could not respond to the notices issued to the email and mobile number of one of the main Trustee who is a senior citizen and not in good health and he was in bed rest in view of his ill health during November – December, 2024. Heeee was not able to access his email for responding to the case by the CA. It was submitted that assessee is eligible for registration under section 12AB of the Act and approval under section 80G of the Act and he has produced medical certificate which is placed at Paper Book page No.6. The learned CIT(E) has passed the Order on 18.12.2024 by considering the registeration under section 12AB of the Act stating tht the Trust was required to submit necessary documents to prove the genuineness of the activities of the Trust or institution and fulfil all the conditions laid down. However, no satisfactory evidences have been adduced in support of its activities if any. Hence, it is not possible to verify the genuineness of the activities as rquried under section 12AB of the Act. Further, in respect of rejection of approval under section 80G of the Act, assessee was mandated to submit necessary documents to prove the genuineness of the activities of the Trust or institution and fulfilment of the conditions laid down in clauses i to v of Section 80G of the Act. However, the assessee has not responded and failed to appear before learned CIT(E) and submit the necessary details and documents accordingly, he did not grant the registration. The society is registered as Charitable Trust on 04.08.2007 and since then it is running old age home, orphanage home for children for helping poor and destitute persons and children. Accordingly, the learned Counsel submitted and undertook that if a chance is given to the assessee, assessee shall comply with the noitces issued by the learned CIT(E) and requested to grant opportunity to the assessee for substanting its case.
The learned DR relied on the Order of the lower authorities and submitted that the assessee was given opportunities to prove the genuineness of the activities carried out by the assessee. However, the assessee is unable to prove the genuineness of the activities before the CIT(E). Therefore, he has rightly rejected the application filed by the assessee.
Considering the rival submissions, we noted that opportunities were granted to the assessee to prove the genuineness of the activities carried out by the assessee. However, assessee has not responded on the scheduled date of hearing and the assessee has submitted a medical certificate of the Trustee dated 25.10.2024 in which the doctor has advised for bed rest. Accordingly, as per our considered opinion, assessee had reasonable cause for not responding to the notices issued by the learned CIT(E). Therefore, considering the facts of the case and in the interest of justice, one more opportunity is granted to the assessee, the cases are remittibg back to the ld. CIT (E) for a fresh consideration and decide the issue as per law and learned CIT(E) is directed to give reasonable opportunity of being heard and the assessee is directed to substantiate its case. Assessee is directed to prove the genuineness of the activities which may be considered as charitable in nature and in case of failure, no further leniency shall be granted to the assessee.
, 273/Bang/2025 Page 4 of 4 4. In the result, appeal of the assessee is allowed for statistical purposes.
Pronounced in the court on the date mentioned on the caption page.