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Facts
The assessee filed an application for registration under Section 12AB of the Income Tax Act, which was rejected by the CIT(E) for non-compliance with notices. The assessee contended that they did not receive the notices and were denied an opportunity to be heard, violating principles of natural justice.
Held
The Tribunal held that the assessee's application was rejected without an effective opportunity of hearing. Therefore, the appeal was allowed, setting aside the CIT(E)'s order and restoring the matter for fresh adjudication.
Key Issues
Whether the rejection of the registration application under section 12AB without providing an effective opportunity of hearing violated principles of natural justice.
Sections Cited
12AB, 143(3)
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Income Tax Appellate Tribunal, ‘B’ BENCH, BANGALORE
Before: SHRI WASEEM AHMED & SHRI SOUNDARARAJAN K
PER WASEEM AHMED, ACCOUNTANT MEMBER:
This is an appeal filed by the assessee against the order passed by the ld. CIT(E), Gul dated 01/11/2024 in DIN No. ITBA/COM/F/17/ 2024-25/1070069186(1) rejecting the application for registration under section 12AB of the Act.
The only issue raised by the assessee is that the learned Commissioner of Income Tax (Exemptions) [CIT(E)], erred in rejecting the application for registration filed under section 12AB of the Income Tax Act, 1961.
The brief facts of the case are that the assessee had filed an application seeking registration under section 12AB of the Act. The said application was rejected by the learned CIT(E) on the ground that the assessee had failed to comply with the notices issued by the Jurisdictional Assessing Officer (JAO). It was observed in the impugned order that no response was filed by the assessee, and hence, the registration was denied.
During the course of appellate proceedings before us, the learned Authorised Representative (AR) submitted that the assessee had not received any notice from the JAO or ld. CIT(E) concerning the registration proceedings. The ld. AR contended that the assessee was denied the opportunity of being heard and that the principles of natural justice had been violated. It was submitted that the non-compliance was not intentional or deliberate but solely due to lack of proper communication. The ld. AR, therefore, prayed that one more opportunity be granted to present the assessee’s case before the ld. CIT(E).
On the other hand, the learned Departmental Representative (DR) supported the order passed by the ld. CIT(E). The ld. DR submitted that the notices were duly issued, and the assessee had sufficient time to respond. However, the ld. DR did not object if the matter is restored to the file of the ld. CIT(E) for fresh consideration in the interest of justice.
We have heard the rival contentions of both the parties and perused the materials available on record. It is seen that the application of the assessee under section 12AB was rejected without affording an effective opportunity of hearing, as the assessee has contended that no . notice was received. In the interest of substantial justice and fair play, we are of the considered opinion that the matter should be restored to the file of the ld. CIT(E) for fresh adjudication, after providing a reasonable opportunity of being heard to the assessee. Accordingly, we set aside the impugned order passed by the ld. CIT(E) and restore the matter to his file with a direction to re-examine the assessee's application for registration under section 12AB of the Act de novo after giving the assessee due opportunity to present its case. Hence, the ground of appeal of the assessee is allowed for statistical purposes.
In the result, the appeal filed by the assessee is allowed for statistical purposes.
Order pronounced in court on 28th day of May, 2025