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Facts
The assessee trust's application for approval under Section 80G and registration under Section 12AB was rejected by the Ld.CIT(E) for alleged non-response to notices. The assessee contended that they did not receive the notices as per Section 282 of the Act and were thus unaware of the requisitions.
Held
The Tribunal condoned a 4-day delay in filing the appeal, found that the CIT(E)'s order violated principles of natural justice by being passed ex-parte without proper service of notice and hearing. It set aside the impugned order, remanding the application back to the CIT(E) for fresh adjudication on merits after hearing the assessee. A cost of Rs.5,000/- per appeal was imposed on the assessee for lack of vigilance.
Key Issues
Whether the Ld.CIT(E)'s rejection of the assessee's applications for approval under Section 80G and registration under Section 12AB without proper service of notice and hearing constituted a violation of the principles of natural justice.
Sections Cited
80G(5), 80G, 12A(1)(ac)(iii), 12AB, 282
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, ‘A’ BENCH: CHENNAI
Before: SHRI ABY T. VARKEY & SHRIMANOJ KUMAR AGGARWAL
आदेश / O R D E R PER ABY T. VARKEY, JM: These appeals are preferred by the assessee trust against the order of the Learned Commissioner of Income Tax (Exemption), Chennai, (hereinafter in short "the Ld.CIT(E)”) dated 02.09.2024 rejecting the application filed by the assessee online on 29.03.2024 in Form No.10AB under clause (iii) of first proviso to section 80G(5) of the Income-tax Act, 1961 (hereinafter in short “the Act”) seeking approval u/s. 80G of the Act & 2805 2804 & 2805/Chny/2024 Samatam Chairtable Trust Sri Iyyappa Bhaktha Samatam :: 2 ::
and rejecting the online application dated 29.03.2024 filed in Form and rejecting the online application dated 29.03.2024 filed in Form and rejecting the online application dated 29.03.2024 filed in Form No.10AB u/s. 12A(1)(ac)(iii) of the Act seeking registration u/s. 12 No.10AB u/s. 12A(1)(ac)(iii) of the Act seeking registration u/s. 12 No.10AB u/s. 12A(1)(ac)(iii) of the Act seeking registration u/s. 12AB of the Act, respectively.
At the outset, the At the outset, the Ld.Counsel for the assessee submitted that there Ld.Counsel for the assessee submitted that there is a delay of ‘4’ days in filing of this ’ days in filing of this appeal in appeal in and filed an affidavit explaining the cause for delay. Having gone through filed an affidavit explaining the cause for delay. Having gone through filed an affidavit explaining the cause for delay. Having gone through the affidavit filed by trustees, which explains t the affidavit filed by trustees, which explains the cause for delay he cause for delay, we are of the view that there are sufficient cause, which prevented the assessee are sufficient cause, which prevented the assessee are sufficient cause, which prevented the assessee from filing of appeal within the from filing of appeal within the time prescribed, therefore, time prescribed, therefore, we condone the delay of ‘4’ days and s and proceed to adjudicate the appeal on merits. adjudicate the appeal on merits.
At the outset, Ld.AR of the assessee submitted that the impugned At the outset, Ld.AR of the assessee submitted that the impugned At the outset, Ld.AR of the assessee submitted that the impugned order of the Ld.CIT(E) is ex order of the Ld.CIT(E) is ex-parte qua assessee trust and the reason parte qua assessee trust and the reason attributed for doing so for doing so was that assessee didn’t respond to his notices was that assessee didn’t respond to his notices dated 10.07.2024 and 26.07.2024. According to the Ld.AR, the assessee dated 10.07.2024 and 26.07.2024. According to the Ld.AR, the assessee dated 10.07.2024 and 26.07.2024. According to the Ld.AR, the assessee didn’t receive any notice as required u/s. 282 of the Act and therefore didn’t receive any notice as required u/s. 282 of the Act and therefore didn’t receive any notice as required u/s. 282 of the Act and therefore was unaware of the requisition made by the Ld.CIT(E was unaware of the requisition made by the Ld.CIT(E) as ) as alleged in the impugned order. Therefore, he prays that one more opportunity may be impugned order. Therefore, he prays that one more opportunity may be impugned order. Therefore, he prays that one more opportunity may be granted to the assessee’s trust. granted to the assessee’s trust.
Per contra, the Ld.DR Per contra, the Ld.DR opposes the plea of the assessee trust for opposes the plea of the assessee trust for giving one more innings to it. According to the Ld.DR if an opp giving one more innings to it. According to the Ld.DR if an opp giving one more innings to it. According to the Ld.DR if an opportunity is granted to the assessee trust then cost may be imposed. granted to the assessee trust then cost may be imposed.
& 2805 2804 & 2805/Chny/2024 Samatam Chairtable Trust Sri Iyyappa Bhaktha Samatam :: 3 ::
We have heard both the parties and perused the records. We have heard both the parties and perused the records. We have heard both the parties and perused the records. It is noted that the assessee trust had filed an application on 29.03.2024 in that the assessee trust had filed an application on 29.03.2024 in that the assessee trust had filed an application on 29.03.2024 in Form No.10AB under clause (iii) of first proviso to section 80G(5) of the under clause (iii) of first proviso to section 80G(5) of the under clause (iii) of first proviso to section 80G(5) of the Act seeking approval under 80G of the Act and 12AB of the Act Act seeking approval under 80G of the Act and 12AB of the Act Act seeking approval under 80G of the Act and 12AB of the Act, which applications got rejected solely on the ground that the assessee didn’t rejected solely on the ground that the assessee didn’t rejected solely on the ground that the assessee didn’t respond to the notices issued by the Ld.CIT(E) dated respond to the notices issued by the Ld.CIT(E) dated respond to the notices issued by the Ld.CIT(E) dated 10.07.2024 & 26.07.2024. According to assessee According to assessee, the notices have not been the notices have not been issued/served upon the assessee as required u/s. 282 of the Act issued/served upon the assessee as required u/s. 282 of the Act issued/served upon the assessee as required u/s. 282 of the Act, therefore, it was in the dark/unaware about the requisition made by the was in the dark/unaware about the requisition made by the was in the dark/unaware about the requisition made by the Ld.CIT(E) and hence, couldn’t fulfill the di , couldn’t fulfill the direction given by the Ld.CIT(E). rection given by the Ld.CIT(E).
Since, the impugned order has been passed without hearing the assessee, Since, the impugned order has been passed without hearing the assessee, Since, the impugned order has been passed without hearing the assessee, there is per-se non-compliance of principle of natural justice. Hence, compliance of principle of natural justice. Hence, compliance of principle of natural justice. Hence, we are of the view that one more opportunity should be granted to the are of the view that one more opportunity should be granted to the are of the view that one more opportunity should be granted to the assessee and therefore, we set aside the impugned order and restore the and therefore, we set aside the impugned order and restore the and therefore, we set aside the impugned order and restore the application back to the file of the Ld.CIT(E) with a direction to consider application back to the file of the Ld.CIT(E) with a direction to consider application back to the file of the Ld.CIT(E) with a direction to consider the same on its merits and pass orders in accordance to law after hearing on its merits and pass orders in accordance to law after hearing on its merits and pass orders in accordance to law after hearing the assessee. The assess the assessee. The assessee is directed to be diligent and e diligent and file all the relevant documents called for/ relevant documents called for/requisitioned by the Ld.CIT(E) by the Ld.CIT(E) for processing the application filed by the assessee processing the application filed by the assessee. Since, assessee has not assessee has not been vigilant, cost of Rs.5,000/- per appeals are imposed imposed, which the assessee should remit to assessee should remit to the State Legal Aid Authority, Hon’ble Madras the State Legal Aid Authority, Hon’ble Madras High Court, and produce necessary proof of High Court, and produce necessary proof of depositing of the same before of the same before & 2805 2804 & 2805/Chny/2024 Samatam Chairtable Trust Sri Iyyappa Bhaktha Samatam the Ld.CIT(E) and thereafter, the and thereafter, the Ld.CIT(E) to pass orders s in accordance to law after hearing the ass after hearing the assessee.
In the result, both the both the appeals filed by the assessee appeals filed by the assessee are allowed for statistical purposes.
Order pronounced on the 26th day of February, 2025, in Chennai. Order pronounced on the , in Chennai.