SHREE 1008 PARSHWANATH DIGAMBAR JIN CHAITYALAY TRUST,JAIPUR vs. CIT(EXEMPTION), AHMEDABAD, AHMEDABAD

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ITA 559/AHD/2025Status: DisposedITAT Ahmedabad30 July 20254 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal acknowledged the assessee's submissions but found no reasonable explanation for the non-compliance before the CIT(E). It noted that the assessee was not careful in filing the application as required documents were not attached, and subsequently, no compliance was made to the notices. Despite this, the Tribunal deemed it proper to impose a cost of Rs. 5,000/- on the assessee, to be deposited in the Prime Minister's National Relief Fund within 15 days. Subject to the payment of this cost, the CIT(E) was directed to allow one more opportunity to the assessee to furnish the required details and documents and thereafter re-adjudicate the application. The assessee was also directed to comply with the CIT(E)'s requirements. The appeal was allowed for statistical purposes.

What were the facts?

The assessee, Shree 1008 Parshwanath Digambar Jin Chaityalay Trust, filed an appeal before the Income Tax Appellate Tribunal (ITAT), Ahmedabad, against an order dated 13.11.2024 passed by the Commissioner of Income Tax (Exemption), Ahmedabad (CIT(E)). The appeal was filed with a delay of 40 days, which was condoned by the Tribunal. The assessee had applied for registration under Section 12A(1)(ac)(iii) of the Income Tax Act, 1961, by filing Form No. 10AB. The CIT(E) noted that the assessee failed to furnish documents listed in Rule 17A(2) and did not comply with notices issued on 27.08.2024 and 16.10.2024. Consequently, the CIT(E) rejected the application, citing dissatisfaction with the genuineness of the trust's activities and cancelling its earlier provisional registration.

What were the issues?

1. Whether the order passed by the Ld. CIT(E) rejecting the assessee's application for registration under Section 12A(1)(ac)(iii) of the Income Tax Act, 1961, is wrong, unwarranted, and bad in law, and whether the assessee should be directed to register the same? 2. Whether the Ld. CIT(E) erred in law and facts by not recording independent satisfaction for the rejection of provisional registration and by not issuing a show cause notice for the rejection of provisional registration under Section 12A of the Act? 3. Whether the Ld. CIT(E) erred in law and facts in rejecting the provisional registration under Section 12A without issuing a separate DIN for the rejection order, which is against CBDT circulars and notifications? Assessee's Contentions: - The non-compliance before the CIT(E) was due to the fault of the earlier consultant who was preoccupied. - The assessee is engaged in charitable activities and requested another opportunity to furnish the required documents by setting aside the matter to the CIT(E)'s file. Revenue's Contentions: - The Ld. CIT. DR had no objection if the matter was set aside to the file of the Ld. CIT(E).

Which sections of the Income-tax Act were involved?

Section 12A(1)(ac)(iii)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “ A” BENCH, AHMEDABAD

Before: SHRI TR SENTHIL KUMAR & SHRI NARENDRA PRASAD SINHA

For Respondent: Shri Alpesh Parmar, CIT. DR
Hearing: 23/07/2025Pronounced: 30/07/2025

आदेश/O R D E R

PER NARENDRA PRASAD SINHA, AM:

1.

This appeal is filed by the assessee against the order passed by the Commissioner of Income Tax (Exemption) Ahmedabad, (in short “the Ld. CIT(E)”) dated 13.11.2024, in the proceedings u/s. 12A(1)(ac)(iii) of the Income Tax Act, 1961 (in short “the Act”).

ITA No.559/Ahd/2025 Asst. Year NA

2. There was a delay of 40 days in filing of this appeal. The assessee has filed a condonation application along with affidavit of Shri Himanshu Rasiklal Shah, trustee of the assessee-trust and explained the reason for the delay. It is submitted that the delay was for the reason that due to recent changes in the Act the assessee was not clear about the exact legal remedy available to the trust and it had taken time in consulting 2 to 3 consultants of different cities. Considering the explanation of the assessee, the delay in filing the appeal is condoned.

3.

The brief facts of the case are that the assessee had made an application for registration u/s. 12A(ac)(iii) of the Act by filing Form No. 10AB. The Ld. CIT(E) noticed that the assessee did not furnish the documents enlisted in Rule 17A(2) along with the application. The Ld. CIT(E) has allowed opportunities to the assessee to furnish the details vide notice dated 27.08.2024 and 16.10.2024. However, there was no compliance to the notices. Therefore, the application of the assessee was rejected as the Ld. CIT(E) was not satisfied about the genuineness of the activities of the trust and the provision registration granted earlier was also cancelled.

4. Aggrieved with the Order of the Ld. CIT(E), the assessee is in appeal before us. The following grounds have been taken in this appeal:

“1. That the order passed by Ld. Commissioner of Income Tax, Exemption, Ahmedabad by rejecting application u/s. 12A(1)(ac)(iii) of the I.T. Act, 1961 is wrong, unwarranted and bad in law. Kindly direct to register the same.

2.

That the Ld. CIT (Exemption), Ahmedabad has erred in law and in facts of the case by neither recording the independent satisfaction for rejection of provisional registration and nor issued Show Cause Notice for rejection of provisional registration

ITA No.559/Ahd/2025 Asst. Year NA

3 u/s. 12A of the I.T. Act 1961 which is wrong, unwarranted and bad in Law. Kindly restore the same.

3. That the Ld. CIT (Exemption), Ahmedabad has erred in law and in facts of the case in rejecting the provisional registration u/s. 12A without issuing separate DIN of the rejection order, which is against the circular & notification issued by the CBDT. So, the same is wrong, unwarranted and bad in Law. Kindly restore the same.

4.

That the order passed by Ld. Commissioner of Income Tax (Exemption), Ahmedabad by rejecting provisional registration u/s. 12A of the I.T. Act, 1961 is wrong, unwarranted and bad in law. Kindly direct to register the same.

5. That the appellant craves permission to add to or amend to any of the above grounds of appeal or to withdraw any of them.”

5.

Shri R S Poonia, Ld. AR appearing for the assessee explained that the non-compliance before the Ld. CIT(E) was due to the fault of the earlier consultant who could not attend the proceedings due to his other pre- occupations. The Ld. AR requested that the assessee is engaged in charitable activities and, therefore, another opportunity may be allowed to furnish the documents as required by setting aside the matter to the file of the Ld. CIT(E).

6.

Per Contra Shri Alpesh Parmar, Ld. CIT. DR submitted that he has no objection if the matter is set-aside to the file of the Ld. CIT(E).

7.

We have carefully considered the submissions of the assessee. We do not find any reasonable explanation for non-compliance before the Ld. CIT(E). In fact, the assessee was not careful and vigilant enough while filing the application in Form No. 10AB of the Act, as the documents enlisted in Rule 17A(2) were not attached along with the application. Thereafter, no compliance was made to the notices of the Ld. CIT(E) and the details and Asst. Year NA documents as required were not furnished. We therefore, deem it proper to impose a cost of Rs.5,000/- on the assessee, which should be deposited in “Prime Minister’s National Relief Fund” within a period of 15 days from the receipt of this order. Subject to the payment of cost, the Ld. CIT(E) is directed to allow one more opportunity to the assessee to furnish the details and documents as required and thereafter, re-adjudicate the application of the assessee. The assessee is also directed to comply before the Ld. CIT(E) and produce the document and clarification as required by him.

8.

In the result, the appeal filed by the assessee is allowed for statistical purposes.

Order pronounced in the Open Court on 30th July, 2025 at Ahmedabad.

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