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Facts
The appellant, IMC of Govt. Industrial Training Institute Jath, applied for registration under Section 12AA, which was denied by the CIT(Exemption) due to alleged non-compliance with notices. The appeal to the ITAT was filed with a 62-day delay, which the appellant explained was due to key staff, including the acting Principal, being on election duty, leading to a lack of responsible personnel to manage the appeal filing process.
Held
The Tribunal found 'reasonable cause' for the 62-day delay and condoned it. It held that the CIT(E) rejected the application without providing a sufficient and reasonable opportunity of being heard, violating principles of natural justice. Consequently, the matter was remanded back to the CIT(E) for de novo adjudication, allowing the appellant a proper opportunity to comply with requirements.
Key Issues
Whether the delay in filing the appeal should be condoned and if the CIT(E) denied registration under Section 12AA without providing adequate opportunity of being heard, thereby violating principles of natural justice.
Sections Cited
12AA, 12A, 12A(1)(ac), 12AA(1)(b)(ii)
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Income Tax Appellate Tribunal, PUNE BENCHES “A”, PUNE
Before: DR.MANISH BORAD & SHRI VINAY BHAMORE
आदेश / ORDER
PER DR. MANISH BORAD, ACCOUNTANT MEMBER :
The captioned appeal at the instance of appellant is directed against the order dated 15.03.2024 framed by CIT(Exemption), Pune denying grant of regular registration u/s.12AA of the Act.
At the outset, we find that the appeal is barred by limitation by 62 days in presenting the appeal before the Tribunal. An affidavit has been filed by the Ex-officio Member of Managing Committee of the appellant explaining the reasonable cause which prevented the appellant in filing the appeal within the stipulated time. The contents of the said affidavit read as under :
1. That, I am Ex-officio Member of Managing Committee of IMC OF GOVT INDUSTRIAL TRAINING INSTITUTE JATH in my capacity as Member-Teachers' Representative."
2. That, I am one of the Teaching Staff at the IMC OF GOVT INDUSTRIAL TRAINING INSTITUTE JATH and my appointment was made by Government of Maharashtra.
3. That, I M C OF GOVT INDUSTRIAL TRAINING INSTITUTE JATH (hereinafter referred to as "the Institute") does not have full-time Principal (who is Ex-officio Secretary) to look after day-to-day affairs of the Institute.
4. That, the Teaching Staff (appointed by Government of Maharashtra) looks after day-to-day affairs of the Institute. The appellant has 6 Teaching Positions and 1 Principal Position which are appointed by Government of Maharashtra.
5. That, the Group Instructor or the Principal looking after day-to-day affairs of the Institute were posted at other ITIs and either were on deputation or have Additional Charge of the Institute. xxxxxxxxxx
7. That, Shri Nikhil Ashok Kulkarni is primarily posted at ITI Koregaon (Satara District) and his office location is at Koregaon (Satara District) and he visits ITI Jath periodically as and when required.
That, Shri. Raju Anna Pawar was deputed at ITI Jath till 12-01-2024 and thereafter reported at ITI Kolhapur due to his transfer and his deputation was cancelled late w.e.f. 15-04-2024.
9.That, there was no full-time Principal or acting Principal posted at the Institute w.e.f. 12-01-2024 to 15-03-2024 which was the period during which proceedings before CIT(E), Pune were going on.
That, 4 teachers including me and Principal Shri. Nikhil Kulkarni were on Election Duty for different duty days assigned; for a substantial period of time from December 2023 to June 2024.
That, in absence of full-time Principal and Shri. Nikhil Kulkarni (additional charge as Principal of the Institute) deputed on Election Duty; the appeal before Hon'ble ITAT could not be filed on or before due date i.e. 14-05-2024 as there was no responsible person/persons available at the Institute to complete the procedure of filing appeal. PKAL xxxxxxxxxxxxxxxxxx
That, 4 teaching staff out of total 7 teaching staff was on mandatory Election Duty for a substantial period of time from December 2023 to June 2024.
That, absence of 4 responsible persons like Principal and Teachers due to Election Duty is the primary reason behind the delay in filing the appeal on or before 14-05-2024 (within 60 days from receipt of Order).
That, Shri. Nikhil Ashok Kulkarni, Principal (Additional Charge) and myself were relieved from Election Duty only after the announcement of official results of General Elections 2024 i.e. on 07-06-2024.
That, Shri. Nikhil Ashok Kulkarni Principal (Additional Charge) and myself could resume our duties at the Institute only after receiving Relieving Orders from Government of Maharashtra and / or District Collector Sangli as the case may be.
That, after resuming our normal duties at the Institute w.e.f. 08-06- 2024; the process of filing appeal actually started after analysing the Rejection Order passed by CIT(E), Pune in consultation with the Professionals (Chartered Accountants).
That, the monthly meeting of Managing Committee was held on 15- 06-2024 wherein the Managing Committee took the decision of filing an appeal with Hon'ble Income Tax Appellate Tribunal and authorized me to sign and execute all necessary documents in relation to filing the appeal before Hon'ble Income Tax Appellate Tribunal.
That, the online admission process of Academic Year 2024-25 started in June 2024 and the administrative duties of responsible persons towards the day-to-day affairs of the Institute also contributed to the delay in filing the appeal.
That, the online admission process of Academic Year 2024-25 has commenced from 03-06-2024 and due date for publishing initial merit list was 04-07-2024.
That, the process of completing necessary administrative procedures of gathering all documents / Notices / Orders / information etc. required for filing appeal before Hon'ble Income Tax Appellate Tribunal and subsequent processing of the information /documents by the Professional engaged in the filing of appeal attributed to further delay in filing this appeal by about 20-25 days.
That, copies of all necessary Office Orders, Notifications, Time Tables etc. supporting the above-mentioned facts are attached with this Affidavit.
That, literal English translation of Office Orders, Notifications, Time Tables etc. is also attached with this Affidavit wherever necessary.”
After going through the averments made in the affidavit, we are satisfied that there was ‘reasonable cause’ for the appellant in not presenting the appeal before the Tribunal within the time. We therefore condone the delay of 62 days in filing this appeal and proceed for adjudication of the appeal.
Appellant has raised following grounds of appeal :
“1. Commissioner of Income Tax (Exemptions) (hereinafter referred to as "the learned CIT(E)], Pune erred on facts in rejecting the registration u/s 12A of the Income Tax Act, 1961.
2. The appellant contends that; the matter be remanded back to the file of learned CIT(E) since CIT(E) rejected the application due to "non- compliance" of the notice and the appellant had bona-fide reasons for such non-compliance.
3. The appellant craves / leave to add/modify/delete / amend all / any of the grounds of appeal.”
Facts of the case are that the appellant is a Govt. Industrial Training Institute established under the Directorate of Vocational Education and Training, Govt. of Maharashtra in the rural areas of Jath. It is established as Training and Skill imparting institute under Public Private Partnership Model where Private Entrepreneurs and State Govt. Employees are the Trustees. The appointments of Managing Body and the teaching staff are done by Govt. of Maharashtra. The appellant has filed application in Form No.10AB under clause (iii) of section 12A(1)(ac) on 14.09.2023. The Ld. CIT(E) in order to verify the genuineness of activities and to ascertain the fulfilment of conditions for granting registration u/s.12AA of the Act, has issued a notice through ITBA portal on 06.11.2023 calling upon the appellant to upload certain information/clarification to which the appellant made compliance. Thereafter, another notice dated 15.01.2024 was issued to the appellant pointing out certain discrepancies in the details so filed, fixing the date of compliance on or before 22.01.2024, which remained unattended.
In the instant appeal, we vouched that, the Ld. CIT(E) after considering the preliminary submission had called for an additional evidence and complying documents inter-alia, copy of MOA, purpose of collecting fees from the students, financial statement for F.Y. 2022-23 along with annexures, copies of bills, invoices etc. which the appellant meritoriously failed to make good by the due date, consequent to which, the Ld. CIT(E) without further opportunity rejected to grant 12A registration to the appellant trust.
The Hon’ble Supreme Court in its landmark decision rendered in “Maneka Gandhi Vs UOI” reported in AIR 1978 SC 597 has laid down that, the rule of fair hearing is necessary before passing any order, the opportunity of being heard should be real, reasonable and effective and same should not be for namesake, it should not be a paper opportunity, the doctrine of natural justice is a facet of fair play in action and no person shall be saddled with a liability without being heard.
8. Ostensibly, the preliminary submission of the appellant did not productively prove its eligibility and claim for grant of approval for 12AA, as a consequence the Ld. CIT(E) requisitioned additional documents by a notice dated 15.01.2024 and in the event of failure, without further opportunity to the appellant, rejected the application in violation of principle of natural justice as commanded by proviso to section 12AA(1)(b)(ii) of the Act. Thus action of the Ld. CIT(E) suffered from sufficiency of reasonable opportunity to the appellant to refute the rejection vis-à-vis to comply with the requirements sought. Thus for the reason, without commenting on the merits of the case, we deem fit to remand the matter back to the file of Ld. CIT(E) for denovo adjudication according reasonable opportunity to refute the rejection vis-à-vis to comply with the requirements sought. Appellant is also directed to remain vigilant and make satisfactory compliance to the notice(s) of hearing issued by ld.CIT(E) and it should refrain from taking adjournments unless otherwise required for reasonable cause. Effective grounds of appeal raised by the appellant are allowed for statistical purposes.
9. In the result, the appeal of the appellant is allowed for statistical purposes.
Order pronounced on this 24th day of March, 2025.