NIRAMALA VIJAY AND PRIYA DAREKAR FOUNDATION,PUNE vs. CIT (EXEMPTION), PUNE

Briefly stated, the facts of the case are that on receipt of the assessee’s application filed in Form No. 10AB u/s 12A(1)(ac)(iii) of the Act along with annexures thereto, 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, the Ld. CIT(E) issued notice on 10.05.2024 through ITBA portal which was duly served on the assessee requesting the assessee to upload certain information/clarification contained therein by 27.05.2024 under the provisions of section 12AB(i)(b)(i) of the Act. On verification of the details/documents filed by the assessee in response to the said notice, the Ld. CIT(E) observed certain discrepancies which were communicated vide issue of another notice dated 03.09.2024 duly served upon the assessee via e-portal/email seeking compliance by 10.09.2024. The said discrepancies are reproduced below : “(i) You have not furnished activity note. Kindly furnish the note on activity giving details viz. dates and places of each activities carried out by your trust, details of beneficiaries, how they were identified, etc. (ii) Furnish the supporting credible evidences in respect with the activities carried out. In absence of any such tangible material in respect of proof of activities being carried out it is not possible to arrive at any conclusion about the genuineness of activities and also to ascertain as to whether the activities are in line with the objects of the trust / institution. (iii) From the financial statements of FY 2020-21 and 2021-22, it is seen that no expenses are shown under object/ activities of the trust. Furnish explanation. (iv) In respect of donation details kindly furnish information in format viz. name of donors, PAN/ address of donors, amount of donation, mode of donation, receipt no. etc. Also furnish the copies of receipt issued to the donors by your trust. (v) Furnish copies of bills/invoices of expenses done on activities.

Aggrieved, the assessee is in appeal before the Tribunal and all the grounds of appeal relate thereto.

The Ld. AR submitted that most of the required documents were submitted in response to the initial notice issued by the Ld. CIT(E). Admittedly, there was non-compliance to the subsequent show cause notice issued by the Ld. CIT(E), however, it was not intentional but occurred on account of certain unavoidable circumstances beyond the control of the assessee which he demonstrated by the reasons stated in the affidavit of one of the trustee of the assessee trust. He therefore prayed that in the interest of justice an opportunity may be granted to the assessee to substantiate and present its case by furnishing all the detail/ documents sought for by the Ld. CIT(E). Accordingly, the matter may be set aside to the file of the Ld. CIT(E) to adjudicate the same afresh on merits after affording an opportunity of being heard to the assessee.

The Ld. DR had no objection the above request of the Ld. AR.

We have heard the Ld. Representatives of the parties and perused the records and the paper book filed by the Ld. AR on behalf of the assessee. We find that the Ld. CIT(E) has rejected the application of the assessee due to non- compliance to the second notice / show cause notice issued asking for certain clarification/documentary evidence as per the discrepancy noted by him including the lack of supporting evidence proving the genuineness of the charitable activities of the assessee trust. Such non-compliance has been explained to be a fall out of communication gap between the trustees of the assessee trust. Before us, the Ld. AR has submitted that most of the information/ details/ documents sought for by the Ld. CIT(E) were filed by the assessee in response to the initial notice and are available on his records. It is also the submission of the Ld. Counsel for the assessee that given an opportunity the assessee is in a position to substantiate its case before the Ld. CIT(E) by filing all the requisite details/ documents as called upon by the Ld. CIT(E). Considering the totality of the facts and in the circumstances of the case enumerated above, we are of the view that it would be judicially expedient and in the interest of justice and fair play, if the matter is restored back to the file of Ld. CIT(E) to consider the assessee’s application afresh and decide the same on merits, in accordance with fact and law after allowing one final opportunity of being heard to the assessee and present its case. Needless to say, the assessee shall provide the requisite support in terms of submitting the relevant details/documentary evidence as may be required/called upon on the appointed date without seeking adjournment under any pretext unless required for sufficient cause, failing which the Ld. CIT(E) shall be at liberty to pass appropriate order as per law. We direct and order accordingly.

In the result, the appeal of assessee is treated as allowed for statistical purposes.