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Facts
The assessee applied for registration under section 12AB of the IT Act. The CIT, Exemption, Pune rejected the application, citing lack of genuine activities, insufficient documentation, and unclear financial statements. The assessee contended that the CIT did not provide adequate opportunity to furnish details.
Held
The Tribunal set aside the order of the CIT and remanded the matter back for fresh consideration. The CIT was directed to provide a reasonable opportunity of hearing to the assessee and decide the application afresh.
Key Issues
Whether the CIT erred in rejecting the registration application without providing sufficient opportunity to the assessee to submit necessary documents and details.
Sections Cited
12AB, 12A(1)(ac)
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Income Tax Appellate Tribunal, PUNE BENCH “A”, PUNE
Before: SHRI MANISH BORAD & SHRI VINAY BHAMORE
Kaka Gole Foundation, Vs. CIT, Exemption, Pune. Akhil Bldg, A. Wing, Basement, Gole Maidan, Badlapur, E.D.B.O., Ambarnath, Thane- 421503. PAN : AADTK3618F Appellant Respondent Assessee by : CA Satyaprakash (Virtual) Revenue by : Shri Amol Khairnar Date of hearing : 23.09.2025 Date of pronouncement : 25.09.2025 आदेश / ORDER
PER VINAY BHAMORE, JM:
This appeal filed by the assessee is directed against the order dated 30.09.2024 passed by Ld. CIT, Exemption, Pune rejecting the application for registration u/s 12AB of the IT Act.
Facts of the case, in brief, are, that the assessee has applied for registration in Form 10AB under clause (iii) of section 12A(1)(ac) of the IT Act on 09.03.2024. With a view to verify the genuineness of 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 on 10.05.2024 through ITBA portal requesting the assessee to upload various information detailed in notice. In compliance to the above said notice, desired information was furnished by the assessee. On verification of said information, Ld. CIT, Exemption, Pune found certain discrepancies and issued another notice on 06.08.2024 requesting the assessee to furnish further details/information in this regard on or before 13.08.2024. The assessee complied to the above said notice. Not being satisfied with the details/information furnished by the assessee, Ld. CIT, Exemption, Pune rejected the application for registration by observing as under :- “6. The assessee furnished its response on 13/08/2024. However, the contention of the assessee is not accepted for the reasons stated as under: (i) The assessee has claimed activities such as .to do the investigative medical reports at a price which is almost 1/3rd of the market price, 2. Arrange for the blood donation camps, 3. Arrange for the eye testing camps, 4. Arrange for general helath check-up camps for the Adivasi padas around Badlapur, 5. In future we want to finance either fully or partially the high cost surgeries which are beyond the reach of common man.,6. During the Covid period we arranged street wise awareness programs for prevention of the spread. However, the said activities are not supported with any documents also no specific details of as who were the beneficiaries, where the activity was carried out and without any supporting proof like photographs are also not on record. Further, these activities are also not supported with any bills / invoices as such the assessee has failed to establish the genuineness of its activities. (ii) (ii) It is observed from the financial statement submitted by the assessee that the main source of income from other sources (Lab collection). it was not clear as to whether the receipts are from the activities intrinsically involved while carrying out the main objectives. However, the assessee in its submission has admitted that it provides medical investigation at 1/3 of the market price. Further, No separate books of accounts (financial statements) were submitted, since the assessee has not furnished separate account statements for the said activity. These receipts are Prima facie from an activity in the nature of advancement of any other object of general public utility (GPU) wherein fees are charged for the services rendered. In absence of such separate books of accounts it was not be possible to check whether such activity was with a profit motive or not. Thus, the main activity of the trust is found to be giving medical support for a fee and not any charity. Therefore, it is seen that the activities of the trust are carrying out medical services on commercial basis and is not charitable in nature.
7. Considering the above facts discussed in the show notice and discrepancies noticed, the undersigned is not satisfied 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.
In view of the above, the application filed by the assessee is hereby rejected and the provisional registration granted on 31/12/2021 under section 12AB read with section 12A(1)(ac)(vi) of the Income Tax Act, 1961 is hereby cancelled.”
It is this above order against which the assessee is in appeal before this Tribunal.
Ld. AR appearing from side of the assessee submitted before us that the order passed by Ld. CIT, Exemption, Pune is unjustified. Ld. AR pointed out that the reply was furnished by the assessee on 13.08.2024 and if he was not satisfied there was enough time (almost 47 days) available with Ld. CIT, Exemption, Pune, to Ld. CIT, Exemption, Pune did not provided any further opportunity and directly passed the final order on 30.09.2024. Ld. AR further submitted that each and every detail desired by Ld. CIT, Exemption, Pune is available with the assessee and if one opportunity is provided to the assessee, he will submit all the details as required by Ld. CIT, Exemption, Pune. Accordingly, Ld. AR requested before the bench to set-aside the order passed by Ld. CIT, Exemption, Pune and further requested to grant registration u/s 12AB of the IT Act.
Ld. DR appearing from side of the Revenue relied on the order of Ld. CIT, Exemption, Pune and requested to confirm the same.
We have heard Ld. Counsels from both the sides and perused the material available on record including the paper book furnished by the assessee. In this regard, we find that admittedly the assessee made compliance to the initial notices issued by the Ld. CIT, Exemption, Pune. It is the sole grievance of the assessee that proper opportunity has not been allowed to him. We further find that the application for registration u/s 12AB of the IT Act was rejected on the ground of non-furnishing of financial statements, in the absence of information regarding nature of income of the trust and the purposes on which the same has been applied and also in the absence of details of donation, if any. Ld. CIT, Exemption, Pune also observed in his order that the activities of assessee were not supported with any documents and the details of beneficiaries and supporting proof like photographs are also not produced and even the comparative chart & receipts to prove that the assessee is performing investigative medical reports at a price which is almost 1/3rd of the market price and due to all these reasons Ld. CIT, Exemption, Pune was not satisfied about the genuineness of the activities of the assessee. However, before us Ld. AR of the assessee contended that if one further opportunity is given to the assessee, he will furnish all the details with regard to queries raised by Ld. CIT, Exemption, Pune.
Considering the totality of the facts of the case, & also in the interest of justice and without going into merits of the case, we deem it appropriate to set-aside the order passed by Ld. CIT, Exemption, Pune and remand the matter back to his file with a direction to decide the application for registration afresh as per fact and law after providing reasonable opportunity of hearing to the assessee. The assessee is also hereby directed to comply with the notices issued by Ld. CIT, Exemption, Pune and produce requisite