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Facts
The assessee appealed against the rejection of provisional registration under Form No.10AC and approval under Section 80G(5) by the CIT(E) for Assessment Years 2022-23 to 2024-25. The appeal was time-barred by 99 days, for which the assessee sought condonation of delay. The CIT(E) had rejected the application citing non-compliance and failure to submit documents, despite the assessee claiming to have submitted relevant financial statements and other documents.
Held
The Tribunal condoned the 99-day delay in filing the appeal, relying on the judgment of Collector, Land Acquisition Vs. Mst. Katiji. It observed that the CIT(E) rejected the application for non-compliance without examining the documents already submitted by the assessee. The matter was remitted back to the CIT(E) for fresh consideration, directing the CIT(E) to provide reasonable opportunity, and the assessee to comply with notices, with no further leniency for subsequent failure.
Key Issues
Whether the delay in filing the appeal should be condoned; Whether the CIT(E) was justified in rejecting the application for approval under Section 80G(5) without examining the submitted documents and providing sufficient opportunity.
Sections Cited
10AC, 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 filed by the assessee against the rejection of provisional registration granted to the assesseeOrder passed by the CIT(E) on 27.10.2021 for the Assessment Years 2022-23 to 2024-25 in Form No.10AC.
At the outset of hearing, the appeal filed by the assessee is time barred by 99 days. Assessee has filed affidavit for codonation of delya vide affidavit dated 01.05.2025 which is placed on record at Page Nos.208 to 210 in which the assessee has stated the reasons for delay in filing the appeal before the Tribunal. On going through the affidavit filed by the assessee, we are of the view that Page 2 of 4 assessee had reasonable cause to not file the appeal within the stipulated time and has explained the reasons. Therefore, relying on the judgment of Hon’ble Apex Court in the case of Collector, LandAcquisitionVs. Mst. Katiji (1987) 167 ITR 471 (SC), we condone the delay.
The learned Counsel submitted that the assessee filed an application in Form No.10AB dated 31.03.2024 for approval under section 80G(5) of the Act. The assessee was granted opportunity on 10.07.2024 and 13.08.2024 to substantiate its case but as per the information of the learnedCIT(E) on the scheduled date of hearing, the assessee was mandated to submit necessary documents to prove the genuineness of the activities of the trust / institution and of the conditions laid down in Clause I to v of section 80G of the Act. Further, the learned CIT(E)noted that the assessee has not responded and failed to appear before the CIT(E) to submit the necessary details / documents called for. Accordingly, he rejected the provisional registration granted.
Aggrieved from the above Order, assessee filed appeal before the ITAT raising various grounds as per Form No.36. The learned Counsel submitted that during the first date of hearing on 30.06.2024, assessee filed adjournment petition and requested time of 15 days to file the requisite documents. Thereafter, the learnedCIT(E) issued only one notice on 13.08.2024 and passed Order on 26.09.2024 without giving any further opportunity to the assessee. However, while filing application form for approval, assessee had filed financial statements, rules and regulations of the society / trust, bank details, activities caried by the teturst which is placed on the Paper Book Containing Pages 1 to 207. The learnedCIT(E) has ignored the submissions of the assessee and requested and undertook that if a chance is given to the assessee, assessee will be able to produce the requisite documents.
Page 3 of 4 5. On the other hand, learned DR objected to give further chance to the assessee. The learned CIT(E), after giving notice in the month of August, had ample time to file documents. Order was passed in the month of Septembr, 2024.
Considering the rival submissions, we noted that the learned CIT(E) has rejected the approval application filed for non-compliance. However, we noted that in the Paper Books, the assessee has enclosed financial statements, activity report, bank account statements, trust deed but learnedCIT(E) has not examined these documents. Considering the facts and circumstances of the case and in the interest of justice, we are remitting this issue back to the learned CIT(E) for fresh consideration and learned CIT(E) is directed to give reasonable opportunity of being heard to the assessee and assessee is directed to comply with the notices issued by the learned CIT(E) for substantiating its case. In case of failure, no second leniency shall be granted to the assessee
In the result, appeal of the assessee is allowed for statistical purposes.
Pronounced in the court on the date mentioned on the caption page.