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Facts
The assessee, Vivekananda Bhaba Samanway Kendra, a Public Charitable and Religious Trust, applied for registration under Section 12A(1)(ac)(iii) of the Income Tax Act, 1961. The CIT (Exemption) rejected the application because the assessee failed to furnish an amended Trust Deed with an 'irrevocability clause' within the three-day notice period, leading to the appeal.
Held
The Tribunal observed that the genuineness of the assessee's charitable activities was not doubted, and an inadequate time of only three days was provided for furnishing the amended Trust Deed. Since the required amendment, including the 'irrevocability clause', was subsequently made, the Tribunal remanded the matter back to the CIT (Exemption) for fresh consideration of the registration application.
Key Issues
Whether the rejection of an application for registration under Section 12A for non-furnishing of an amended Trust Deed with an 'irrevocability clause' within an unreasonably short timeframe violates principles of natural justice, especially when the required amendment is later complied with.
Sections Cited
12A, 12A(1)(ac)(iii)
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Income Tax Appellate Tribunal, ‘D’ BENCH, KOLKATA
Per Udayan Dasgupta, Judicial Member:- This appeal is preferred by the assessee against the order of the Ld. Commissioner of Income Tax (Exemption), Kolkata, dated 28/06/2025, rejecting the application for registration filed in Form 10AB, u/s 12A(i)(ac)(iii) of the Income Tax Act 61 (henceforth referred to as the Act 61 ) for failure on the part of the assessee to Vivekananda Bhaba Samanway Kendra furnish the copy of the amended Trust Deed , with ‘irrevocability clause’, in compliance to notice issued on 23rd June, 2025.
The assessee-Trust has taken seven grounds of appeal in its Memorandum in Form 36, and all the grounds are in relation to the rejection of the registration application by the Ld. CIT(Exemption) without allowing proper opportunity to respond to the required clarification sought for and without giving proper cognizance to the documentary evidences (including supporting photographs) filed by the assessee to establish the genuineness of the charitable activities carried out.
In course of hearing, the Ld. Authorized Representative of the assessee submitted that the assessee is a Public Charitable and Religious Trust and has pointed out to the notice dated 23rd June, 2025, issued from the Office of the Ld. CIT (Exemption) , asking for furnishing of Amended Trust Deed within three working days on 26th June, 2025, and thereafter on the failure of the assessee to comply with such directions within three days the registration application u/s 12A has been rejected vide order dated 28th June, 2025, which violates the principles of natural justice .
He further submitted that necessary Amendment in the Trust Deed has already been done , vide a Deed of Modification dated 30th July, 2025 by insertion of the Additional Clause No 21 relating to the ‘irrevocable clause’ (and a copy of the same has been filed before us), and he prayed for remanding the matter back to the Ld. CIT Vivekananda Bhaba Samanway Kendra (Exemption), for consideration of the application for registration afresh, after taking into account the additional clause incorporated vide the Modification Deed dated 30th July, 2025, more so considering the fact that the genuineness of the activities of the assessee-Trust has not been doubted.
The Ld. Departmental Representative relied on the order of the Ld. CIT (Exemption), but has no objection if the matter is remanded for fresh consideration.
We have heard the rival submissions and considered materials on record and we are of the opinion that there is no adverse findings in respect of the genuineness of the activities carried out by the Trust and regarding the issue of absence of irrevocable clause in the Trust Deed, proper and reasonable time has not been provided to the assessee for furnishing the Amended Deed, which needs compliance of required formalities for amendment as per the provision of the State rules and regulations (the assessee being a Public Charitable Trust) and the time of only three days is not adequate enough.
Since the necessary amendment has now been done as evident by the Modification Deed dated 30th July, 2025, (fresh evidence) we deem it proper in the interest of justice to remand the matter back to the Ld. CIT (Exemption), for consideration of the application for registration afresh taking into account the necessary amendments who will proceed to dispose of the same as per provisions of law, within a reasonable time. 3
In the result the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open Court on 23/10/2025.