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Facts
The assessee filed an application for registration under Section 12AB of the Income Tax Act, 1961. The CIT(E) rejected the application on grounds of incomplete form, lack of registration under Rajasthan Public Trust Act, and non-genuineness of activities, also cancelling its provisional registration.
Held
The Tribunal condoned the delay in filing the appeal, noting the assessee's bona fide belief and consultant's lack of proper guidance. The Tribunal restored the matter to the CIT(E) to decide afresh, providing the assessee with an opportunity to submit required documents.
Key Issues
Whether the rejection of registration under Section 12AB by the CIT(E) was justified, and whether principles of natural justice were followed.
Sections Cited
12AB, 12A
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Income Tax Appellate Tribunal, JAIPUR BENCHES,”B” JAIPUR
आयकरअपीलीय अधिकरण] जयपुरन्यायपीठ] जयपुर IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES,”B” JAIPUR Mk0 ,l- lhrky{eh] U;kf;dlnL; ,oaJhjkBkSM+ deys'kt;UrHkkbZ] ys[kk lnL; ds le{k BEFORE: DR. S. SEETHALAKSHMI, JM & SHRI RATHOD KAMLESH JAYANTBHAI, AM vk;djvihyla-@ITA No.1234/JP/2024 Under Section 12AB of the Act fu/kZkj.ko"kZ@AssessmentYear : 2023-24 cuke The CIT (Exemption) Maharishi Markendeya Sushrut Sewa Sansthan 16, Kanti Nagar, Near Polovictory Cinema Vs. Jaipur Station Road, Jaipur 302 006 LFkk;hys[kk la-@thvkbZvkjla-@PAN/GIR No.: AAIAM 7945B vihykFkhZ@Appellant izR;FkhZ@Respondent fu/kZkfjrh dh vksjls@Assesseeby :Shri Anoop Bhatia, CA jktLo dh vksjls@Revenue by: Mrs. Alka Gautam, CIT –DR,(Thru: V.C.) lquokbZ dh rkjh[k@Date of Hearing : 28/10/2025 mn?kks"k.kk dh rkjh[k@Date of Pronouncement: 30 /10/2025 vkns'k@ORDER PER: RATHOD KAMLESH JAYANTBHAI, AM
The assessee has filed an appeal against the order of the ld.CIT (Exemption), Jaipur dated 24-02-2024 passed under section 12AB of the Income Tax Act, 1961, raising therein following grounds of appeal; ‘’1. Under the facts and circumstances of the case and in law Ld CIT (E) has erred in denying the approval to the assessee under Section 12AB of the Income Tax Act 1961.
MAHARISHI MARKANDEYA SUSHRUT SEWA SANSTHAN VS CIT (E), JAIPUR 2. Under the facts and circumstances of the case and in law Ld. CIT(E) has erred in rejecting the application of approval under section 12AB of the income Tax Act 1961 on the Technical grounds, such action being absolutely unjustified, unlawful as well as against the concept of natural justice hence the order passed by lit CIT, Exemptions deserves to be quashed.
Under the facts and circumstances of the case and in law Ld. CIT(E) has erred in rejecting the application on the ground that appellant trust was not able to substantiate thegenuineness of activities which is absolutely incorrect. Appellant prays rejecting the application without considering or rebutting the documents and material filed before the Ld CIT (E) being bad in law and in violations to the principles of natural justice deserves to be rolled Back.’’ 2.1 During the course of hearing, the Bench noticed that there is delay of 163 days in filing the appeal for which Vice Chairman Shri Nitish Kumar Sharma filed a letter requesting therein to condone the delay for the reason thatthe assessee was under a bona fide belief that necessary compliance had been completed by the professional who are appointed. But it was not communicated to the assessee from their end that the procedural requirement for filling the appeal was not made within the prescribed time limit which resulted delay in timely filing the appeal. He further submitted that as soon as they became aware of the requirement, immediate steps were taken to file the appeal without any further delay. Thus, the assessee prayed to condone the delay in filing the appeal before ITAT. To this effect, assessee has filed an affidavit deposing therein that thedelay was caused 2.2 On the other hand, the ld. DR objected to such inordinate delay but submitted that the Court may decide the issue as deemed fit and proper in the case in the interest of justice.
2.3 After hearing both the parties and perusing the materials available on record, the Bench feels that the reasons substantiated by the assessee has merit and thus the delay is condoned because assessee should not suffer at the cost of consultant.
3.1 Brief facts of the case are that the assessee filed an online application in Form No. 10AB seeking registration u/s 12AB of the Income Tax Act, 1961[ for short Act ] on 30.09.2023. A letter/notice dated 27.01.2024 was issued at the e-mail/address provided in the application requiring the assessee to submit certain documents/explanations by 09.02.2024, but no compliance was made by the assessee. Thereafter, a reminder letter was issued vide notice dated 10.02.2024 fixing the date of hearing on 15-02-2024 but no compliance had been made by the MAHARISHI MARKANDEYA SUSHRUT SEWA SANSTHAN VS CIT (E), JAIPUR assessee. However, one more opportunity was given to the assessee vide letter dated 16-02-2024 fixing the date of hearing on 21-02-2024 but the assessee had not provided any details / documents on this date of hearing. Thus the case was decided by the ld. CIT(E) based on the materials available before him. The ld. CIT(E) noted that the assessee had failed to comply with the letters, despite given three opportunities. The ld. CIT(E) noted that since the assessee could not furnish the information / details as sought and thus, the ld. CIT(E) could not find out the genuineness of the charitable activities and objects of the assessee trust. Hence, the ld. CIT(E) rejected the assessee’s claim of registration u/s 12AB of the Act by observing as under:-. ‘’05. In view of above discussion assessee’s claim of registration section 12AB is liable to be rejected and thus being rejected on following grounds:-
Incomplete Form 10AB Registration under Rajasthan Public Trust Act,, 1959. Non Genuineness of activities and non-compliance
06. Further 12AB (1)(b)(ii) (B) of the Income Tax Act, 1961 also state that if CIT is not satisfiedhas to pass order rejecting such application and also cancelling its earlier registration. Thus, it is clarified that applicant's provisional registration under clause (vi) of clause (ac) of sub-section (1) of section 12A of the Income Tax Act, 1961 dated 06.04.2022 is also being cancelled. Further assessee has failed to give proper justification for regularization of provisional registration, thus with this order provisional registration is also cancelled.’’ MAHARISHI MARKANDEYA SUSHRUT SEWA SANSTHAN VS CIT (E), JAIPUR 3.2 While hearing, the ld. AR of the assessee mainly submitted that the assessee was not provided proper opportunity of personal hearing by the ld. CIT(E) and thustheorder should be quashed being ex-parte order and against the principles of natural justice. He submitted a Certificate dated 18-03-2024 issued by the office of Asstt. Commissioner (First), Devsthan Vibhag, Jaipur Khand, Jaipur under Rajasthan Public Trust Act, 1959 and further submitted once this being available with the assessee, the other reasons upon which rejections was made being curable in nature the assessee may be provided one more opportunity to adduce the required documents before the ld. CIT(E) as mentioned in his order.
3.3 On the other hand, the ld. DR relied upon the order of the ld. CIT(E).
3.4 After hearing both parties and perusing the materials available on record, we noticed that the ld. CIT(E) has rejected the assessee’s claim of registration u/s 12AB of the Act on following grounds:- Incomplete Form 10AB Registration under Rajasthan Public Trust Act,, 1959. Non Genuineness of activities and non-compliance MAHARISHI MARKANDEYA SUSHRUT SEWA SANSTHAN VS CIT (E), JAIPUR Before us, the ld. AR of the assessee prayed that he has already placed on record the certificate of registration under the RPT Act the other two reasons as mentioned by the ld. CIT(E) being curable in nature the assessee may be provided one more opportunity to adduce the required documents before the ld. CIT(A) as the assessee did not receive the communication from the Department physically to file the documents and thus the assessee could not adduce the documents before the ld CIT(E). He further submitted that the assessee trust has obtained the certificate from Devsthan Vibhagh, Jaipur under Rajasthan Public Trust Act, 1959 and the same is placed on record (supra). Based on this submission, we are of the considered view that lis between the parties has to be decided on merits so that nobody’s rights could be scuttled down without providing the proper opportunity of being heard and thereby the principles of natural justice to be followed. Looking to that aspect of the matter we direct the assessee trust to provide details / justification for registration before the ld. CIT(E)and also in all these circumstances of the facts and circumstances of the case, the Bench restores the matter back to the file of the ld. CIT(E) to decide the issue (supra) afresh in accordance with law. Since, we have restored the matter to the file of ld. CIT(E), the provisional registration MAHARISHI MARKANDEYA SUSHRUT SEWA SANSTHAN VS CIT (E), JAIPUR which is otherwise valid will survive till the ld. CIT(E) decides the issue of registration. 3.5. Before parting, we may make it clear that our decision to restore the matter back (supra) to the file of the ld. CIT(E) shall in no way be construed as having any reflection or expression on the merits of the dispute, which shall be adjudicated by the ld. CIT(E) independently in accordance with law.
4. In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open court on 30 /10/2025. Sd/- Sd/- ¼jkBksMdeys'kt;UrHkkbZ ½ ¼Mk0 ,l- lhrky{eh ½ (Dr. S. Seethalakshmi) (Rathod Kamlesh Jayantbhai) U;kf;dlnL;@Judicial Member ys[kklnL;@Accountant Member Tk;iqj@Jaipur fnukad@Dated:- 30/ 10 /2025 *Mishra आदेश की प्रतिलिपिअग्रेf’ात@ब्वचल वf जीम वतकमत वितूंतकमक जवरू 1. The Appellant- Maharishi Markandey Sushrut Sewa Sansthan, Jaipur 2. izR;FkhZ@ The Respondent- The CIT(E), Jaipur 3. vk;djvk;qDr@ Theld CIT 4. विभागीय प्रतिनिधि] आयकरअपीलीय अधिकरण] जयपुर@क्त्ए प्ज्Aज्ए Jंपचनत 5. xkMZQkbZy@ Guard File (ITA No.1234/JP/2024) vkns'kkuqlkj@ By order,
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