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Income Tax Appellate Tribunal, “A” BENCH, PUNE
Before: SHRI R.K. PANDA & MS. ASTHA CHANDRA
PER ASTHA CHANDRA, JM : Two appeals filed by the assessee are directed against the two separate order(s) both dated 06.12.2024 of the Ld. Commissioner of Income Tax (Exemption), Pune [“CIT(E)"] whereby he rejected the application of the assessee filed before him in Form No. 10AB u/s 12A(1)(ac)(iii) and section 80G(5)(iii) of the Income Tax Act, 1961 (the "Act") filed on 29.08.2024. These were heard together and are being disposed of by this order.
The assessee has raised the following grounds of appeal :- "
The Id CIT Exemption erred in law and on facts in rejection of application for approval u/s 12AA without considering the facts and circumstances of the case.
The appellant prays for opportunity so as to explain its case. The appellant craves its right to add to or alter the grounds of appeal at any time before or during the course of hearing of the case.”
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 etc., the Ld. CIT(E) issued notice on 17.10.2024 through ITBA portal requesting the assessee to upload certain information/clarification such as date of commencement of activity, date of expiry of provisional registration, details of any other law applicable for achievement of objectives and the proof of compliance of said law, proof of identity of main trustees / managing trustees / directors / trustees / secretary, list of donors, note on activities carried out in the last three years/inception etc. under the provisions of section 12AB of the Act. The compliance was sought by 04.11.2024. The notice was duly served on the assessee through e-portal and email. Since, the assessee failed to respond, another notice was issued on 08.11.2024 requesting it to show cause as to why the application should not be rejected and why the registration granted u/s 12AB of the Act should not be cancelled. The compliance was due by 18.11.2024. The assessee was specifically informed that in the event of failure to comply by due date the application shall be liable to be rejected and the registration/approval shall also be liable to be cancelled. The notice(s) were duly served on the assessee through e-portal/e-mail. The assessee again failed to comply with the said show cause notice. The Ld. CIT(E), therefore, observed that in the absence of compliance to the information/clarification sought for, it is not possible to arrive at any conclusion about the genuineness of the activities of the assessee as also compliance to the requirements of any other law as are material for the purpose of achieving its objects. The Ld. CIT(E), hence proceeded to pass the impugned order rejecting the application of the assessee and canceling the provisional registration granted to the assessee by observing in para 8 of his order as under : "8 It is clear from the above that the assessee was given sufficient opportunity to comply, but it has not complied to the same. It seems that the assessee is not having any supporting documents / evidence to submit. The assessee has failed to comply with the provisions of section 12AB(1)(b)(i) of the Income Tax Act, 1961. Hence, the undersigned is unable to draw any satisfactory conclusion about genuineness of activities of the assessee and the compliance to the 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. Therefore, the undersigned has left no alternative but to reject the application."
Dissatisfied, the assessee is in appeal before the Tribunal.
The Ld. AR submitted that there was no intentional non-appearance before the Ld. CIT(E). As can be seen from the order of the Ld. CIT(E), adequate opportunity of hearing was not granted to the assessee to present its case before him. He submitted that given an opportunity the assessee is in a position to submit all the requisite details/ documentary evidence before the Ld. CIT(E) in support of its application. He, therefore, prayed that the matter may be set aside to the file of the Ld. CIT(E) to adjudicate the same on merits afresh after affording one more opportunity of being heard to the assessee.
The Ld. DR conceded to the above proposition of the Ld. AR.
We have considered the rival submissions and perused the records. On the facts and in the circumstances of the assessee's case, 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 for registration u/s 12A(1)(ac)(iii) of the Act afresh and decide the matter on merits, in accordance with facts and law after allowing an opportunity of being heard to the assessee and present its case. 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, failing which the Ld. CIT(E) shall be at liberty to pass appropriate order as per law. We order accordingly.
In the result, the appeal of assessee is treated as allowed for statistical purposes.
The brief facts in this appeal are that the assessee trust applied for final registration u/s 80G(5)(iii) of the Act on 29.08.2024. On receipt of the assessee's application filed in Form No. 10AB under clause (iii) of first proviso to section 80G(5) of the Act along with annexures thereto, with a view to verify the genuineness of the activities of the assessee etc., the Ld. CIT(E) issued notice on 17.10.2024 through ITBA portal requiring the assessee to upload certain information/clarification such as date of commencement of activity, date of expiry of provisional registration, details of any other law applicable for achievement of objectives and the proof of compliance of said law, proof of identity of main trustees / directors / trustees, year-wise list of donations received, note on activities carried out along with supporting credible evidence etc. The compliance was sought by 04.11.2024. Since the assessee did not comply, another notice was issued on08.11.2024 requesting the assessee to submit compliance by 18.11.2024. The assessee was requested to show cause as to why its application should not be rejected and the approval u/s 80G(5)(vi) of the Act should not be cancelled. The assessee was specifically informed that in the event of failure to comply by the due date, the application shall be liable to be rejected and the registration / approval shall also be liable to be cancelled. The assessee was also given opportunity of being heard. The said notice(s) were duly served on the assessee through e-portal and email. However, the assessee neither furnished any compliance to the said notice nor availed the opportunity of being heard. The Ld. CIT(E), therefore, observed that the assessee has failed to furnish the details called for under the provisions of sub-clause (a) of clause (ii) of second proviso to section 80G(5) of the Act required to verify the genuineness of activities of the institution / fund and fulfillment of conditions laid down in clauses (i) to (v) of Section 80G(5) of the Act. The information called for is basic information required to ascertain the overall nature of activities of the assessee and are directly relevant to the present proceedings. However, the assessee has failed to submit such details / information despite giving sufficient opportunity. He noted that in the absence of compliance to the above requirement, it is not possible to arrive at any conclusion about the genunieness of activities of the assessee and fulfillment of conditions laid down in clauses (i) to (v) of Section 80G(5) of the Act and hence proceeded to pass the impugned order rejecting the assessee's application u/s 80G(5)(iii) of the Act by observing as under :
"
It is clear that the assessee was given sufficient opportunity to comply, but it has failed to comply. It seems that the assessee is not having any supporting documents / evidence to submit. The assessee has failed to comply with the provisions of sub-clause (a) of clause (ii) of second proviso to section 80G(5) of the Income Tax Act, 1961 and hence, the undersigned is unable to draw any satisfactory conclusion about genuineness of activities of the assessee and fulfillment of conditions laid down in clauses (i) to (v) of section 80G(5) of the Act and has left no alternative but to reject the application.
Further, as per the condition vide clause (i) of section 80G(5) of the Income Tax Act, 1961, the approval under section 80G(5)(vi) is available only if the income of the institution or fund is not be liable to inclusion in its total income under the provisions of section 11 and 12 or clause (23AA) / clause (23C) of section 10 of the Income Tax Act, 1961. Exclusions for the said condition are detailed in clause (a), (b) and (c) of proviso to clause (i) of section 80G(5) of the Act. Therefore, the institution / fund is required to be regularly registered / approved either under section 12AB or 10(23AA) or 10(23C) of the Income Tax Act, 1961 or the institution / fund shall be a Regimental Fund or Non- Public Fund established by the armed forces of the Union for the welfare of the past and present members of such forces or their dependants. 9 In the instant case it is noticed that the assessee has neither furnished a сору of regular registration u/s 12AB read with section 12A(1)(ac)(i)/12A(1)(ac) (iii) nor any copy of regular approval under section 10(23C) read with clause (1) / (iii) of first proviso to the said section and the case is not covered under the exclusions provided vide proviso to clause (i) of section 80G(5) of the Act. The assessee is not approved under section 10(23AA) of the Act. The assessee is also not a Regimental Fund or Non- Public Fund established by the armed forces of the Union for the welfare of the past and present members of such forces or their dependants. In fact, the application of the assessee in form No.10AB for registration u/s 12AB filed under the provisions of section 12A(1)(ac)(iii) of the Act has been rejected vide order dated 06/12/2024. Therefore, the condition (i) of section 80G(5) of the Income Tax Act, 1961 is also not fulfilled in this case.
In view of the above, the application under sub clause (B) of (iv) of first proviso to sub-section (5) of section 80G of the Income Tax Act, 1961 filed by the assessee is hereby rejected." Aggrieved, the assessee is in appeal before the Tribunal by raising the following grounds of appeal :
"
The Id CIT Exemption erred in law and on facts in rejection of application for approval us 80G without considering the facts and circumstances of the case.
The appellant prays for opportunity so as to explain its case.
The appellant craves its right to add to or alter the Grounds of Appeal at any time before during the course of hearing of the case.”
We find that the facts as narrated above in ITA No. 2740/PUN/2024 are identical to ITA No. 2739/PUN/2024 except that the assessee is seeking registration u/s.80G of the Act in this appeal which has been rejected by the Ld. CIT(E). The Ld. Counsel for the assessee has made similar submissions before us as are made in the above ITA No. 2739/PUN/2024. Since, the facts and submissions in ITA No. 2740/PUN/2024 are similar to ITA No. 2739/PUN/2024, the findings given by us while deciding the appeal of assessee in ITA No. 2739/PUN/2024 would mutatis mutandis apply to ITA No. 2740/PUN/2024, as well. Accordingly, the appeal of assessee is allowed for statistical purposes.
To sum up, both the appeals of the assessee in ITA Nos.2739 & 2740/PUN/2024 are allowed for statistical purposes. Order pronounced in the open court on 28th January, 2025. (R.K. Panda) VICE PRESIDENT (Astha Chandra) JUDICIAL MEMBER पुणे / Pune; दिनांक / Dated : 28th January, 2025. रवि आदेश की प्रतिलिपि अग्रेषित /