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Facts
The assessee, a section 8 company, applied for registration under Section 12AB and 80G of the Income Tax Act. The CIT(E) rejected the applications citing non-compliance with notices and failure to provide necessary documents, despite the assessee claiming to have submitted information via email and that a proper hearing was not granted.
Held
The Tribunal held that the CIT(E) rejected the applications without granting adequate opportunity of hearing and without considering the submissions made by the assessee. Therefore, the appeals were remitted back to the CIT(E) for fresh consideration.
Key Issues
Whether the rejection of registration applications under Section 12AB and 80G by the CIT(E) was in violation of natural justice principles and statutory timelines, and if the submissions made by the assessee were duly considered.
Sections Cited
12AB, 80G, 2(14)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “A’’BENCH: BANGALORE
Before: SHRI LAXMI PRASAD SAHU & SHRI KESHAV DUBEY
These appeals at the instance of the assessee are directed against the orders of ld. CIT(Exemptions) both orders dated 9.1.2025 vide DIN &Notice Nos. ITBA/EXM/F/EXM45/2024- 25/1072035160(1) and ITBA/EXM/F/EXM45/2024- 25/1072035225(1) for the assessment year 2025-26 rejecting applications u/s 12AB & 80G of the Income Tax Act, 1961 (in short “The Act”) respectively. Since the grounds in both the appeals are common in nature, these are clubbed together, heard together and disposed of by this common order.
& 199/Bang/2025 M/s. Deltin Foundation, Goa Page 2 of 5 2. First, we take for the AY 2025-26 as the lead case. The grounds of appeal as raised by the assessee in this appeal are as follows:
& 199/Bang/2025 M/s. Deltin Foundation, Goa Page 3 of 5
Brief facts of the case are that assessee is section 8 Company registered under the Companies Act, 2013, incorporated on 03/10/2023 with an object to promote education, post which it obtained provisional registration u/s 12AB of the Act vide Order dated 04/12/2023.The Income tax return for AY 2024-25 was filed on 07/10/2024 declaring Rs. Nil Income.On receipt of CSR funds, the assessee applied for a permanent registration u/s 12AB of the Act within 6 months of commencement of activities. Accordingly, an application for registration was made within the timeline. The ld. CIT(E) had called for various details vide notice dated 12/11/2024 requiring the assessee to make the submissions on or before 03/12/2024. Further, on 30/11/2024; the ld. CIT (E) issued another notice to make the submissions (of details called for in the previous notice) on 10/12/2024 (rescheduling the previous hearing). As claimed by ld. A.R. of the assessee, the requisite details were sent through email dated 03/12/2024 from the email id namely sureshsahane@deltin.com. Again, the ld. CIT(E) issued a notice dated 09/01/2025 calling for a hearing on 24/01/2025.
& 199/Bang/2025 M/s. Deltin Foundation, Goa Page 4 of 5 However, the ld. CIT(E) on the same day i.e. 09/01/2025 closed the window to make the submissions on the Income Tax portal. The CIT (E) didn't consider the submissions and without giving any further opportunity of hearing passed an Order in Form No. 10AD dated 09/01/2025 rejecting the application and cancelling the registration u/ s. 12AB of the Act.
Aggrieved by the order of ld. CIT(Exemption), the assessee has filed the present appeal before this Tribunal. On going through the order passed by ld. CIT(Exemption) i.e. Annexure to Form No.10AD dated 9.1.2025, we found that ld. CIT(Exemption) observed that according to section 12AB of the Act, the assessee is required to submit necessary documents to prove the genuineness of the activity of the Trust or institution and also the compliance of such requirement of any other law as are material for the purpose of achieving its object. As the assessee has not responded to the notices issued and failed to appear before the ld. CIT(Exemption) and submit all the necessary documents/details as required for registration u/s 12AB of the Act, the ld. CIT(Exemption) rejected the applications and cancelled the registration of the assessee.
At the time of hearing, both the parties fairly conceded that the assessee could not represent its case before the ld. CIT(Exemption). Further, ld. A.R. of the assessee vehemently submitted that the ld. CIT(Exemption) did not consider the submission sent through e-mail on 3.12.2024 and passed the order without giving any further opportunity of being heard. Being so, in the interest of justice and fair play, we remit the entire issue in dispute to the file of ld. CIT(Exemption) for fresh consideration and to decide the same in accordance with law. Needless to say, a reasonable opportunity of being heard must be granted to the assessee. The assessee is also directed to cooperate with the & 199/Bang/2025 M/s. Deltin Foundation, Goa Page 5 of 5 proceedings before the ld. CIT (Exemption) and file relevant documents/ evidences/ submissions/ information which would be required by the ld. CIT(Exemption) for granting registration. We clarify that in case of further default, the assessee shall not be entitled for any leniency. It is ordered accordingly. as the grant of registration u/s 80G of the Act is dependent on the outcome of the appeal in hence, the same is also restored to the file of ld. CIT(Exemption) for deciding it afresh in accordance of law.