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Facts
The assessee applied for registration under Section 12A and approval under Section 80G, which the CIT(Exemption) rejected, also cancelling provisional registration under Section 12AB. The rejection was based on perceived discrepancies and lack of response to notices. The assessee contended that the second notice was sent to an ex-director's email ID, thus preventing a timely response.
Held
The Tribunal acknowledged the assessee's non-response to the second notice but considered the explanation regarding the incorrect email ID. In the interest of justice, the Tribunal restored the matter to the CIT(Exemption), directing to grant the assessee one final opportunity to furnish the requisite details and decide the issue on merits.
Key Issues
Whether the CIT(Exemption) was justified in rejecting the applications for Section 12A registration and Section 80G approval ex-parte due to non-receipt of notice by the assessee on its correct email ID, and if the matter should be remanded for a fresh opportunity.
Sections Cited
12A, 12A(1)(ac), 12AB, 80G
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, PUNE BENCH “A”, PUNE
Before: SHRI R. K. PANDA & MS. ASTHA CHANDRA
The above two appeals filed by the assessee are directed against the separate orders dated 21.02.2025 of the Ld. CIT(Exemption), Pune rejecting the application for grant of registration u/s 12A and approval u/s 80G of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’). For the sake of convenience, both these appeals were heard together and are being disposed of by this common order.
There is a delay of 55 days in filing of both the appeals before the Tribunal for which the assessee has filed separate condonation applications along with affidavits explaining the reasons for such delay which is on account of issue of notice to wrong e-mail ID. After considering the contents of the condonation applications filed along with the affidavits and after hearing the Ld. DR, the delay in filing of the appeals is condoned and the appeals are admitted for adjudication.
CIT(Exemption) in rejecting the application for registration u/s 12A of the Act while relates to the order of the CIT(Exemption) in denying the approval u/s 80G of the Act.
Facts of the case, in brief, are that the assessee filed an application in Form No.10AB on 04.09.2024 for registration of the trust under clause (iii) of section 12A(1)(ac) of the Act. With a view to verify the genuineness of the activities of the assessee and compliance to requirements of any other law for the time being in force by the trust / institution as are material for the purpose of achieving its objects, a notice was issued through ITBA portal on 04.11.2024 requesting the assessee to upload certain information / clarification. In response to the same, the assessee filed certain details. The CIT(Exemption) while going through those details found certain discrepancies in the submissions filed by the assessee for which he issued another notice to clarify on those issues. However, in absence of any response from the side of the assessee trust, the CIT(Exemption) rejected the application filed by the assessee for grant of registration u/s 12A of the Act and also cancelled the provisional registration granted earlier u/s 12AB of the Act by observing as under: “5. The assessee was requested to show cause as to why the application should not be rejected and why the registration granted under section 12AB of the Income Tax Act, 1961 should not be cancelled. The assessee was also given opportunity of being heard vide the said notice. The assessee was specifically informed that in the event of failure to comply by the due date, the application shall be liable to be rejected and the registration shall also be liable to be cancelled. The compliance to the said notice was due on 17/02/2025. The notice was duly served on the assessee through e-portal and email. However, the assessee neither submitted explanation to the show cause notice till date nor availed the opportunity of being heard.
Since, the assessee has not furnished any explanation to the discrepancies communicated to it, it is presumed that the assessee has nothing to say in the matter.
Considering the above facts discussed in the show notice and discrepancies noticed and also that the assessee has not complied with the provisions of section 12AB(1)(b)(i) of the Income Tax Act, 1961 as well as the provisions of Rule 17A(2) of Income Tax Rules, 1962 in spite giving sufficient opportunities, the undersigned is unable to draw any satisfactory conclusion about the genuineness of activities of the assessee and compliance of requirements of any other law for the time being in force by the assessee as are material for the purpose of achieving its objects.
8. In view of the above, the application filed by the assessee is hereby rejected and the provisional registration granted on 04/06/2024 under Item (A) of sub-clause (vi) of clause (ac) of sub-section (1) of section 12A of the Income Tax Act, 1961 is hereby cancelled.
Since he has rejected the grant of registration u/s 12A of the Act and cancelled the provisional registration granted earlier, he refused to grant approval u/s 80G of the Act.
6. Aggrieved with such order of CIT(Exemption), the assessee is in appeal before the Tribunal by raising the following grounds: 1] The learned CIT(E) erred in rejecting application filed by the appellant in Form 10AB for approval under sub clause (ii) of clause (ac) of sub section (1) of section 12A on an ex-parte basis without appreciating that the notice dated 10.02.2025 was issued on email id shilpakhatod@gmail.com belonging to the erstwhile director of the appellant foundation and not on the email id 'shridevic@gmail.com' registered on income tax portal and and therefore, the rejection of application vide order dated 21.02.2025 on ex-parte basis without granting a proper opportunity of being heard was not justified.
2] The assessee submits that it is genuinely engaged in the activity of animal welfare and given a proper opportunity to represent its case, the documentary proofs regarding construction of facility for medical treatment of animals and other activities shall be duly furnished before the CIT(E) to prove the genuineness of activities. 3] The appellant craves leave to addition / alter / amend any of the grounds of appeal.
7. Similar grounds have been raised in which read as under: 1] The learned CIT(E) erred in rejecting application filed by the appellant in Form 10AB for approval under sub clause (ii) of first proviso to sub section (5) of section 80G was filed under a wrong clause instead of the correct clause (iii) which was applicable for trusts / foundation who had obtained provisional registration without appreciating that the denial of registration u/s 80G only on the above technical ground was not justified in law. 2] The learned CIT(E) further erred in rejecting the application u/s 80G on an ex-parte basis without appreciating that the notice dated 10.02.2025 was issued on email id 'shilpakhatod@gmail.com' belonging to the erstwhile director of the appellant foundation and not on the email id ‘shridevic@gmail.com' registered on income tax portal and therefore, the rejection of application vide order dated 21.02.2025 on ex-parte basis without granting a proper opportunity of being heard was not justified. 3] The assessee submits that it is genuinely engaged in the activity of animal welfare and given a proper opportunity to represent its case, the documentary proofs regarding construction of facility for medical treatment of animals and other activities shall be duly furnished before the CIT(E) to prove the genuineness of activities. 4] The appellant craves leave to add/alter/ amend any of the grounds appeal.
The Ld. Counsel for the assessee submitted that the assessee in response to the first notice has filed various details. However, the assessee could not respond to the second notice issued by the CIT(Exemption) on account of issue of the notice to email ID of one ex-trustee who did not inform the assessee since she had already resigned. He accordingly submitted that in the interest of justice, the assessee should be given an opportunity to substantiate its case by filing the requisite details before the Ld. CIT(E).
The Ld. DR on the other hand strongly opposed the submissions made by the Ld. Counsel for the assessee.
We have heard the rival arguments made by both the sides, perused the order of the CIT(E) and the paper book filed on behalf of the assessee. It is an admitted fact that the assessee did not respond to the second notice issued by the CIT(Exemption) in which he has asked for certain details on account of certain discrepancies found from the submissions made by the assessee earlier for which he rejected the application filed by the assessee for grant of registration u/s 12A of the Act and also cancelled the provisional registration granted earlier u/s 12AB. Since the application for grant of registration u/s 12A of the Act was rejected and the provisional registration granted earlier was cancelled, he rejected the application for approval u/s 80G of the Act. It is the submission of the Ld. Counsel for the assessee that due to non-receipt of the notice in the official email ID of the assessee trust, the assessee could not respond to the second notice. It is also his submission that given an opportunity, the assessee is in a position to substantiate its case by filing the requisite details before the Ld. CIT(E) to his satisfaction. Considering the totality of the facts of the case and in the interest of justice, we deem it proper to restore the issue to the file of the Ld. CIT(Exemption) with a direction to grant one final opportunity to the assessee to substantiate its case by filing the requisite details to his satisfaction and decide the issue as per fact and law. The assessee is also hereby directed to submit the details as called for by the Ld. CIT(E) on the appointed date without seeking any adjournment under any pretext, failing which the Ld. CIT(Exemption) is at liberty to pass appropriate order as per law. We hold and direct accordingly. The grounds raised by the assessee are accordingly allowed for statistical purposes.
In the result, both the appeals filed by the assessee are allowed for statistical purposes.
Order pronounced in the open Court on 9th October, 2025.