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Facts
The assessee filed an application for registration under section 12AB of the IT Act. The Ld. CIT rejected the application citing discrepancies in activities and lack of charitable nature, without providing sufficient opportunity.
Held
The Tribunal held that the assessee was not given a proper opportunity to present its case and that the matter should be remanded back to the Ld. CIT for fresh consideration. The assessee was directed to provide all requisite documents.
Key Issues
Whether the Ld. CIT provided a proper opportunity to the assessee before rejecting the application for registration u/s 12AB of the IT Act.
Sections Cited
12AB, 12A(1)(ac), 12A(1)(ac)(vi)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, PUNE BENCH “A”, PUNE
Before: SHRI MANISH BORAD & SHRI VINAY BHAMORE
Monali Gorhe Foundation, Vs. CIT, Exemption, Pune. E-603, Pathardi- 422010. PAN : AAOCM9915F Appellant Respondent Assessee by : Shri Dhiraj S. Dandgaval Revenue by : Shri Amol Khairnar Date of hearing : 05.08.2025 Date of pronouncement : 07.08.2025 आदेश / ORDER
PER VINAY BHAMORE, JM:
This appeal filed by the assessee is directed against the order dated 24.09.2024 passed by Ld. CIT, Exemption, Pune rejecting the application for registration u/s 12AB of the IT Act.
There is delay of 73 days in filing of the present appeal. We are satisfied with the reasons mentioned in the affidavit for condonation that the applicant was prevented by sufficient cause for not filing the appeal within the prescribed time limit. After hearing Ld. DR we condone the delay of 73 days and proceed to adjudicate the appeal.
Facts of the case, in brief, are, that the assessee filed application for registration in Form No.10AB under clause (iii) of section 12A(1)(ac) of the IT Act on 15.03.2024. 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 by Ld. CIT, Exemption, Pune through ITBA portal on 16.05.2024 requesting the assessee to upload certain information/clarification. The desired information was furnished by the assessee. On verification of said information furnished by the assessee, Ld. CIT, Exemption, Pune found certain discrepancies in the information furnished by the assessee and issued another notice on 14.09.2024. The assessee furnished part information in reply to the above notice, therefore Ld. CIT, Exemption, Pune was not satisfied about the charitable nature and the genuineness of activities of the assessee and rejected the application for registration and also cancelled the provisional registration granted to the assessee on 08.02.2022 u/s 12AB r.w.s. 12A(1)(ac)(vi) of the IT Act by observing as under :- “6. The assessee furnished its response on 20/09/2024. It, however, has not furnished any written clarification/ submission on any of the issues raised in the show cause notice. In its submission the assessee has attached a NOC in the name of Dheeraj Mande wherein it has been stated that "Premises (Mande Lawns) has been given to the organisation on revenue sharing basis which will be generated through training activity". This contradicts the assessee's contention in its reply that the trust has taken merely registration charges for the said activity. This also shows that the activity of the trust is run on commercial basis and is not charitable in nature. Also, the assessee was specifically given opportunity of being heard vide the notice dated 14/09/2024 to offer its explanation with credible evidences to showcause notice points no 2 (ii), 2(iii). However, the assessee trust has not availed the said opportunity nor submitted any credible evidences such as bills/ vouchers for the said points to support its claims.
7. Considering the above facts discussed in the show notice and discrepancies noticed, the undersigned is not satisfied about the charitable nature and the genuineness of activities of the assessee.
In view of the above, the application filed by the assessee is hereby rejected and the provisional registration granted on 08/02/2022 under section 12AB read with section 12A(1)(ac) (vi) of the Income Tax Act, 1961 is hereby cancelled.”
It is this order against which the assessee is in appeal before this Tribunal.
Ld. AR appearing from the side of the assessee submitted before us that Ld. CIT, Exemption, Pune has not provided proper opportunity to the assessee and, therefore, the impugned order of Ld. CIT, Exemption, Pune is not justified. It was submitted that the last notice was issued on 14.09.2024 asking for various information 20.09.2024. It was submitted that lots of information was already furnished by the assessee and again various information was required through the above notice dated 14.09.2024 and only seven days were provided to the assessee to furnish the desired information. Ld. AR submitted before the Bench that if Ld. CIT, Exemption, Pune was not satisfied with the reply furnished by the assessee, he should have had provided one more opportunity to the assessee since the last date to decide the application was 30.09.2024. Accordingly, it was requested before the Bench to set- aside the impugned order passed by Ld. CIT, Exemption, Pune with a direction to provide at least one more opportunity to furnish the requisite documents/information as desired by Ld. CIT, Exemption, Pune.
Ld. DR appearing from the 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 filed by the assessee. We find that admittedly the assessee made compliance Ld. CIT, Exemption, Pune. It is the sole contention of the assessee trust that one more opportunity may kindly be provided to furnish reply before Ld. CIT, Exemption, Pune. In this regard, it was contended before the Bench that due to paucity of time the complete reply could not be filed by the assessee trust & in such kind of situation, Ld. CIT, Exemption, Pune ought to have provided at-least one more opportunity to the assessee to substantiate his case. Considering the totality of the facts of the case, & also in the interest of justice and without going into merits of the case, we set-aside the order passed by Ld. CIT, Exemption, Pune and remand the matter back to him 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 documents/information/ submissions in support of the application for registration without taking any adjournment under any pretext, otherwise, Ld. CIT, Exemption, Pune shall be at liberty to pass appropriate order as per law. Thus, the grounds of appeal raised by the assessee are allowed for statistical purposes.