Loading judgment…
Facts
The assessee, Gram Seva Samaj Vankal, applied for approval under Section 80G(5)(iii) of the Income Tax Act, 1961. The CIT(Exemptions) rejected the application ex-parte and cancelled provisional 80G approval due to non-compliance with procedural requirements, including non-submission of documents and non-appearance, despite issuing notices. The assessee filed an appeal with a delay of 115 days, which the Tribunal condoned citing the Trust's unfamiliarity with Income Tax procedures.
Held
The Tribunal observed that the CIT(Exemptions) failed to consider the assessee's valid registration under Section 12A(1) for AY 2022-23 to 2026-27, which is a relevant fact for Section 80G approval. Considering this omission and the interest of natural justice, the Tribunal set aside the CIT(Exemptions)'s order. The matter was restored for de novo consideration, instructing the CIT(Exemptions) to grant a due opportunity of hearing and consider all relevant facts, including the existing Section 12A(1) registration.
Key Issues
Whether the CIT(Exemptions) erred in rejecting the application for approval under Section 80G(5)(iii) ex-parte without considering the assessee's existing registration under Section 12A(1) and without affording a proper opportunity of hearing.
Sections Cited
80G, 80G(5)(iii), 12A(1)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “C” BENCH, AHMEDABAD
Before: SMT. ANNAPURNA GUPTA & SHRI SIDDHARTHA NAUTIYAL
PER SIDDHARTHA NAUTIYAL - JUDICIAL MEMBER:
This appeal has been filed by the Assessee against the order passed by the Ld. Commissioner of Income Tax (Exemption), (in short “Ld. CIT(E)”), Ahmedabad vide order dated 21.11.2024. 2. The Assessee has taken the following grounds of appeal:-
“1. That on facts, and in law, the learned CIT(Exemption) has grievously erred in not granting sufficient and reasonable opportunity of hearing and in rejecting the application for approval u/s 80G(5)(iii) of the Act, vide ex-parte order.
That on facts and in law, the application made u/s 80G(5)(iii) ought to have been granted by learned CIT(Exemption) as prayed for.
The appellant craves liberty to add, alter, amend any ground of appeal.”
The brief facts of the case are that the Commissioner (Exemptions) passed an order rejecting the assessee’s application for approval under Section 80G(5)(iii) of the Income Tax Act, 1961 (Act) on the ground that the assessee Asst.Year –N.A. - 2– failed to comply with the procedural requirements. Despite repeated notices, the assessee neither submitted the requisite documents and information as mandated under Rule 11AA(2) of the Income Tax Rules nor appeared or sought adjournment. CIT(Exemptions) placed reliance on various judicial precedents, including decisions of the Hon’ble Supreme Court in Dawoodi Bohara Jamat and New Noble Educational Society, and held that in the absence of material to establish the genuineness of the institution and its activities, satisfaction as required under law could not be recorded. Consequently, the application filed in Form 10AB was rejected, and the assessee’s provisional approval under Section 80G was also cancelled.
The assessee has filed an application seeking condonation of delay of 115 days in filing the appeal against the order rejecting approval under section 80G(5)(iii) of the Act. The delay has been explained through an Affidavit dated 05.05.2025 filed by Shri Subhashbhai Ramjibhai Chaudhary, Trustee of the appellant Trust. It has stated in the Affidavit that the assessee Trust is unfamiliar with Income Tax proceedings and portal-related procedures, and had no prior experience in such matters. The assessee came to know about the rejection of the application only in February 2025, and thereafter immediately took steps to file the appeal. We find the explanation offered to be bona fide and supported by circumstances beyond the control of the assessee. In view of the same, and in the interest of justice, the delay of 115 days in filing the present appeal is hereby condoned.
On merits, we note this appeal has been preferred by the assessee against the order passed by the CIT(Exemptions) rejecting the assessee’s application for grant of registration under section 80G of the Act. The Commissioner (Exemptions) denied the registration solely on the ground that the assessee did Asst.Year –N.A. - 3– not cause appearance or respond to the notices issued during the course of proceedings. The assessee has submitted that the assessee did not have prior experience in handling income tax matters and was not conversant with the process of accessing or responding to notices served electronically through the departmental portal. The explanation offered by the assessee for the non- appearance appears to be bona fide and not indicative of deliberate non- compliance. It is also an undisputed fact that the assessee was granted valid registration under section 12A(1) of the Act for the period from Assessment Year 2022-23 to Assessment Year 2026-27. However, this material fact was neither referred to nor considered by the CIT(Exemptions) while rejecting the application under section 80G of the Act. The existence of a valid registration under section 12A(1) is a relevant consideration while adjudicating an application under section 80G of the Act. In view of the above, and in the interest of natural justice, we are of the opinion that the matter requires fresh adjudication. Accordingly, the order of the CIT(Exemptions) is set aside, and the issue of grant of registration under section 80G of the Act is restored to the file of the CIT(Exemptions) for de novo consideration. The CIT(Exemptions) shall afford due opportunity of hearing to the assessee and pass a reasoned order after taking into account all relevant facts and applicable legal provisions, including the fact of existing registration under section 12A(1) of the Act.
The appeal of the assessee is allowed for statistical purposes. This Order pronounced in Open Court on 30/07/2025 (ANNAPURNA GUPTA) JUDICIAL MEMBER Ahmedabad; Dated 30/07/2025 TANMAY, Sr. PSITA No. 1192/Ahd/2025 Asst.Year –N.A. - 4–
आदेश की "ितिलिप अ"ेिषत/Copy of the Order forwarded to : 1. अपीलाथ" / The Appellant
""थ" / The Respondent. संबंिधत आयकर आयु" / Concerned CIT 3. 4. आयकर आयु"(अपील) / The CIT(A)- 5. िवभागीय "ितिनिध, आयकर अपीलीय अिधकरण, अहमदाबाद / DR, ITAT, Ahmedabad गाड" फाईल / Guard file. 6. आदेशानुसार/ BY ORDER,
उप/सहायक पंजीकार (Dy./Asstt.