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Income Tax Appellate Tribunal, LUCKNOW BENCH “B”, LUCKNOW
Before: SHRI KUL BHARAT & SHRI ANADEE NATH MISSHRA
This appeal has been filed by the appellant against the order of the Ld. Commissioner of Income Tax (Exemptions), Lucknow (“CIT(E)”, for short) dated 25.09.2024 for the assessment year 2024-25 whereby the Ld. CIT(E) dismissed the assessee’s application for registration under section 12A/12AA of Income Tax Act, 1961 (“Act”, for short). The grounds of appeal of the assessee are as under: -
1. The CIT(E) erred in law and on facts in denying registration u/s 12AB of the Act solely on the ground that the activities of the assessee-trust could not be established as charitable though the CIT(F) has not stated anywhere that the objects of the assessee-trust as copied in the impugned rejection order were not at all charitable.
2. The CIT(E) erred in law and on facts in ignoring that the Trust in its infant stage was in the process of creating infrastructure to carry out its charitable objects and therefore, no activity to meet its charitable objects have commenced till 31/03/2024 as was submitted to the CIT(E) also and mentioned in para no. 5 on page no. 6 of the rejection order.
3. The CIT(E) passed the order in a mechanical manner without considering the replies filed by the assessee and also without giving a reasonable Opportunity of being heard after the CIT(E) became not satisfied with the submissions by giving a mandatory SCN as is mentioned u/s 12AB (1)(b)(i1)(B) of the Act. Therefore, his action of rejecting the Page 2 of 4 registration application is perverse in law ab initio. Therefore, the assessee must be granted registration u/s 12AB of the Act as applied.
The appellant craves the leave to add, substitute, ‘modify, delete or amend all or any ground of appeal either before or at the time of hearing.” 1.1 In the course of appellate proceedings in Income Tax Appellate Tribunal (“ITAT”, for short), the assessee filed a paper book containing the following particulars: -
2. At the time of hearing before us, the Ld. Authorized Representative (“AR”, for short) for the appellant who joined the hearing in virtual mode, submitted that the Ld. CIT(E) had called for certain details which were partly submitted by the appellant. However, the Ld. AR for the assessee submitted that the Ld. CIT(A) hastily passed the aforesaid impugned appellate order dated 25.09.2024 rejecting the assessee’s application for Page 3 of 4 registration under section 12A/12AA of the Act, without providing adequate opportunity to the applicant. The Ld. AR for the appellant further submitted that the hasty order passed by the aforesaid impugned order in undue haste, without providing reasonable opportunity to the applicant, was in clear violation of principles of natural justice. Furthermore, he submitted that the impugned order of the Ld. CIT(E) should be set aside and he should be directed to pass fresh order in accordance with law, after providing reasonable opportunity to the applicant. The Ld. Departmental Representative (“DR”, for short) for Revenue expressed no objection to this request made on behalf of the appellant by the Ld. AR for the appellant.
We have heard both sides. We have considered the materials available on record. It is found the Ld. CIT(E) rejected appellant’s application for registration under section 12A/12AA of the Act on the ground that the applicant had failed to file documentary evidences to enable him to satisfy himself about the genuineness and commencement of its charitable activities and to verify whether these activities were in consonance with the objects of the applicant trust. Further, it is found that the Ld. CIT(E) provided only one opportunity on 11.07.2024, to comply with the notice and for furnishing of details called for. Though the appellant partly filed the details called for, the Ld. CIT(E) did not provide any further opportunity to the applicant. In view of the foregoing, and as representatives of both sides are in agreement with this, in the specific facts and circumstances of the present case before us; we are of the view that the applicant deserves further opportunity before the Ld. CIT(E) to present its case. Therefore, we set aside the aforesaid impugned order dated 25.09.2024 of the Ld. CIT(E) and we direct the Ld. CIT(E) to pass Page 4 of 4 denovo order in accordance with law, after providing reasonable opportunity to the assessee. In the result, the appeal of the assessee is partly allowed for statistical purposes.
Order pronounced in the open Court on 18/03/2025.