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Facts
The assessee filed an application for registration under Section 12AB of the Income-tax Act, 1961. The CIT (Exemption) rejected the application, stating that the assessee failed to provide necessary documents to establish the genuineness of its activities and compliance with applicable laws.
Held
The Tribunal held that the principles of natural justice were not adequately followed as the documents submitted by the assessee were not properly considered by the CIT. The Tribunal set aside the impugned order and restored the matter to the CIT for fresh adjudication.
Key Issues
Whether the CIT(Exemption) rightly rejected the application for registration under Section 12AB for non-compliance with documentary requirements, or if principles of natural justice were violated.
Sections Cited
12AB, 1961
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Income Tax Appellate Tribunal, ‘C’ BENCH, BANGALORE
Before: SHRI WASEEM AHMED & SHRI KESHAV DUBEY
Shri Raghavendra R Assessee by : Chakravarthy, CA Revenue by : Smt. Nandini Das, CIT-DR Date of hearing : 22.01.2025 Date of Pronouncement : 16.04.2025 O R D E R PER WASEEM AHMED, ACCOUNTANT MEMBER:
This appeal has been filed by the assessee against the order passed by the Learned Commissioner of Income Tax (Exemption) dated 6th November 2024, whereby the application made under section 12AB of the Income-tax Act, 1961 for regular registration was rejected.
The assessee had filed an application in Form No. 10AB on 9th May 2024 2. seeking registration under section 12AB of the Act. The Learned CIT (Exemption) rejected the application on the grounds that the assessee failed to submit the necessary documents to establish the genuineness of its activities and compliance with other applicable laws essential for achieving the objectives of the trust.
The learned AR before us filed up a paper book running from pages 1 to 62 and submitted that all requisite documents and explanations were duly filed before the ld. CIT (Exemption) through a letter dated 10th October 2024. A paper book containing relevant documents running from pages 1 to 62 was submitted before us, and attention was specifically drawn to pages 20 and 21, demonstrating the evidentiary supporting documents that were provided but not considered. It was thus argued that the rejection of the application was made without appreciating the materials placed on record. The ld. AR, therefore, requested that the matter be remanded to the ld. CIT (Exemption) for fresh adjudication after considering the submissions of the assessee and in accordance with law.
The Learned Departmental Representative (DR) submitted that he has no objection if the matter is restored to the file of the ld. CIT (Exemption) for reconsideration as per the provisions of law.
We have heard the rival contentions of both the parties and perused the materials available on record. It is evident that the principles of natural justice have not been adequately followed in the present case. The assessee appears to have submitted documents and explanations which were not properly considered by the ld. CIT (Exemption) while passing the impugned order. Thus, in the interest of justice/ fair-play, we are inclined to set aside the impugned order and restore the matter to the file of the ld. CIT (Exemption) for fresh adjudication. The ld. CIT (Exemption) shall examine the documents already submitted and consider any further explanations or evidence provided by the assessee and pass a speaking order in accordance with law after affording adequate opportunity of being heard to the assessee. Hence, the appeal filed by the assessee is allowed for statistical purposes.
Order pronounced in court on 16th day of April, 2025