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Facts
The assessee filed applications for registration under Section 12A and approval under Section 80G. The CIT(E) rejected these applications due to the assessee's failure to furnish requested details and comply with notices, citing lack of clarity on the genuineness of activities and compliance with other laws.
Held
The Tribunal held that the CIT(E) erred in rejecting the applications without granting a final opportunity to the assessee to explain and substantiate its case. The matter was restored to the CIT(E) with a direction to provide one last opportunity.
Key Issues
Whether the CIT(E) was justified in rejecting the applications for 12A registration and 80G approval without providing a final opportunity for the assessee to submit required documents and explanations.
Sections Cited
12A, 80G, 12A(1)(ac), 12AB(1)(b)(i)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “A” BENCH, PUNE
Before: SHRI R.K. PANDA & MS. ASTHA CHANDRA
आयकर अपील सं. / & 1291/PUN/2025 Chitrakar Deepak R Patil Art and Culture CIT Exemption, Pune Foundation, Flat No. 8/4, Ground Floor, Vs. Ekdant Housing Society, Arihant Garden, Laxminagar, Tal. Khalapur, Khopoli-410203 PAN : AADTC3218K अपीलार्थी / Appellant प्रत्यर्थी / Respondent Assessee by : Shri Ajinkya M Vaishampayan (Virtual) Department by : Shri Amol Khairnar Date of hearing : 10-09-2025 Date of 30-09-2025 Pronouncement : आदेश / ORDER
PER ASTHA CHANDRA, JM :
The above two appeals filed by the assessee are directed against the separate orders both dated 21.03.2025 of the Ld. Commissioner of Income Tax (Exemption), Pune (“CIT(E)”) rejecting the application(s) for grant of registration u/s 12A and approval u/s 80G of the Income Tax Act, 1961 (the “Act”). For the sake of convenience, both these appeals were heard together and are being disposed of by this common order.
In Ld. CIT (E) in rejecting the application for registration u/s 12A of the Act while relates to the order of the Ld. CIT(E) in denying the approval u/s 80G of the Act.
Facts of the case in Form No.10AB on 04.10.2024 for registration of the trust under clause (iii) of section 12A(1)(ac) of the Act. objects, a notice was issued through ITBA portal on 27.11.2024 requesting the assessee to upload certain information/clarification. The assessee was asked to file compliance by 16.12.2024. The notice was duly served on the assessee through e-portal and email. The assessee failed to comply. Another notice was then issued on 21.02.2025 seeking compliance by 28.02.2025. The Ld. CIT(E) while going through these details submitted in response to the said notice and documents filed along with the application, found certain discrepancies for which he issued another notice on 10.03.2025 requesting the assessee for necessary compliance by 17.03.2025. The said discrepancies recorded by the Ld. CIT(E) in para 4 of the impugned order is reproduced below: “4. … "(i) It is seen from your submission that your trust is engaged in activities like preserving / possession of ancient monuments / sculptures and running a studio gallery. However, documentary details of the studio gallery / permission-approval Letter from National Monuments Authorities / Ministry of Culture to carry out the activities as claimed by your trust is not furnished. Kindly furnish the same.
(ii) Kindly furnish audited financials (Tentative) with all schedules /annexures for FY 2024-25."
3.1 The assessee once again failed to comply to the show cause notice and did not furnish any explanation to the above discrepancies which constrained the Ld. CIT(E) presume that the assessee has nothing to say in the matter and therefore having been unable to draw any satisfactory conclusion about the genuineness of the activities of the assessee trust, the Ld. CIT(E) proceeded to pass the impugned order rejecting the application of the assessee and also cancelling the provisional registration earlier granted to the assessee by observing as under : “7. 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 20/01/2024 under section 12A of the Income Tax Act, 1961 is hereby cancelled.”
Aggrieved with such order of the Ld. CIT(E), the assessee is in appeal before the Tribunal by raising the following grounds: “
On facts and in law.
1. The Hon'ble and Learned CIT Exemption), Pune erred in rejecting the application for final approval of registration u/s 12A.
2. The Assessee could not notice the e-mail and respond in time, resulting in Ex-Parte order of the Hon'ble and Learned CIT(Exemption), Pune, rejecting the application for registration u/s 12A.
3. The assessee Trust requests for an additional opportunity of being heard and making submission on merit.
4. The Assessee craves leave to add, alter, amend and delete nay of the grounds of appeal.”
5. Admittedly, the facts of the case in are similar to that of narrated above. Similar grounds have been raised in ITA No. 1291/PUN/2025 which read as under: “On facts and in law:
1. 1. The Hon'ble and Learned CIT(Exemption), Pune erred in rejecting the application for final approval of registration u/s 80G of the Act.
2. The Assessee could not notice the e-mail and respond in time, resulting in Ex-Parte order of the Hon'ble and Learned CIT(Exemption), Pune, rejecting the application for registration u/s 80G.
3. The Assessee Trust requests for an additional opportunity of being heard and making submission on merit.
4. The Assessee craves leave to add, alter, amend and delete nay of the grounds of appeal.”
It is the submission of the Ld. AR that since the Ld. CIT(E) 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.
The Ld. AR submitted that the assessee is a small trust engaged in the promotion of art and culture. The show cause notice issued by the Ld. CIT(E) via e-mail was inadvertently missed by the assessee and there was no malafide intention on the part of the assessee for such non-compliance. The Ld. AR submitted that given an opportunity the assessee is in a position to file all the details/ documents as desired by the Ld. CIT(E). He therefore prayed for one more opportunity to be granted to the assessee to present and substantiate its case before the Ld. CIT(E) by filing the requisite details/documents.
The Ld. DR, on the other hand, supported the order of the Ld CIT(E).
We have heard Ld. Representatives of the parties, perused the material available on record. It is an admitted fact that the assessee filed some response to the initial notice issued by the Ld. CIT(E), however, the same were not to the satisfaction of the Ld. CIT(E). The assessee thereafter failed to comply with the subsequent show cause notice requiring the assessee to submit certain documents/details. The Ld. CIT(E) therefore rejected the application of the assessee u/s 12A for the reason recorded in para 7 of his impugned order (reproduced in the preceding paragraph). The assessee’s application for grant of approval u/s 80G has also been rejected by the Ld. CIT(E) on the similar grounds. Further, since the application for grant of registration u/s 12A of the Act was rejected and the provisional registration granted earlier was cancelled, he also rejected the application for grant of approval u/s 80G of the Act.
Considering the totality of the facts and in the circumstances of the case enumerated above and in the interest of justice, we deem it proper, to set aside the impugned order(s) of the Ld. CIT(E) and restore the issue(s) to his file with a direction to grant one final opportunity to the assessee to explain and substantiate its case to his satisfaction by filing the requisite details as may be required/ called upon and decide both the applications of the assessee under section 12A and 80G of the Act afresh as per fact and law. The assessee is also hereby directed to remain vigilant in accessing notices of hearing and make his submissions on the appointed date without seeking any adjournment under any pretext unless required for the sufficient cause, failing which the Ld. CIT(E) shall be at liberty to pass appropriate order(s) as per law. We hold and direct accordingly. The grounds raised
by the assessee in both the appeals are accordingly allowed for statistical purposes.
11. In the result, both the appeals in & 1291/PUN/2025 filed by the assessee are allowed for statistical purposes.