KIDNEY PATIENTS WELFARE SOCIETY,JAIPUR vs. CIT EXEMPTION, JAIPUR

Non registration under Rajasthan Public Trust Act, 1959. Non genuineness of activities. CIT(E) also noted that since the assessee failed to give proper justification for regularization of provisional approval, he also cancelled the provisional registration of 12. A granted to the assessee

6. Assessee aggrieved from the rejection of approval/recognition has preferred the present appeal on the grounds as raised here in above. Apropos to the ground so raised the Id. AR of the assessee submitted that the reasons advanced for rejection are curable and the assessee was not given sufficient opportunity of being heard before the Id. CIT(E). The Id. AR also submitted that the trust has already applied for registration under the Rajasthan Public Trust Act also and copy of the registration certificate granted to the assessee trust placed on record. Other observations are curable and therefore, he prayed to remand the matter to the file of Id. CIT(E).’’ 2.1 Apropos to the ground so raised by the assessee in the ld. CIT(E) rejected the assessee’s claim of registration u/s 12AB of the Act by observing as under:- ‘’2.5…… Hence, the applicant has failed to prove that the assessee is registered under RPT Act,1959 as discussed above. In light of above discussion and in the absence of registration under Rajasthan Public Trust Act, 1959, assessee is not eligible for registration u/s 12AB.

 Non registration with RPT Act, 1959.

1. Further 12AB (1)(b)(ii)(B) of the Income Tax Act, 1961 also state that if CIT is not satisfied has 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 24.05.2022 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 lapsed and cancelled.’’ 2.1 Apropos to the ground so raised by the assessee in the ld. CIT(E) rejected the assessee’s claim of registration u/s 80G of the Act by observing as under:- ‘’02. Approval u/s 80G cannot be granted without registration u/s 12AB:-

2.1. As per rule 11AA of the Income Tax Rule, 1962, the registration u/s 12A/12AB or notification u/s 10(23C) is a precondition for granting approval u/s 80G of the I.T. Act, 1961. Vide this office order No.ITBA/EXM/F/EXM45/2024- 25/1071627547(1) dated 27.12.2024, the application for registration u/s 12AB was rejected. Therefore, it is not eligible for exemption u/s 80G of the I.T. Act, 1961

3. In view of above discussion assessee's claim of approval u/s 80G is liable to be rejected. Further 2nd proviso to 80G also state that if CIT is not satisfied has to pass order rejecting such application and also cancelling its earlier registration. Thus, it is clarified that applicant's provisional registration under clause (iv) of first proviso to Sub-section (5) of Section 80G of the Income Tax Act, 1961 dated 24-05-2022 is also being cancelled. Further assessee has failed to give proper justification for regularization of provisional approval, thus with this order provisional approval is also lapsed and cancelled.’’ 2.3 During the course of hearing, the ld. AR of the assessee in both the appeals mainly submitted that the assessee was not provided adequate opportunity of being heard by the ld. CIT(E) and thus both the orders should be quashed being against the principles of natural justice. Further, it is submitted by the ld. AR of the assessee that he has submitted all the required documents as desired by the ld. CIT(E) but the ld. CIT(E) without verifying the details, documents, evidences, in a routine manner rejected the approval of registration of trust u/s 12AB of the Act. The ld.ARof the assessee also submitted that the assessee trust is a charitable Trust and it has also got registration under Rajasthan Public Trust Act,1959 for which the ld.AR of the assessee has submitted the copy of registration before the Bench. Conclusively, he prayed that he should be given one more chance to contest the case before the ld. CIT(E) to resolve the issue and also to apprise him about the documents already produced by the Trust for registration u/s 12AB of the Act.

2.4. Per contra, the ld. DR relied on the order of the ld. CIT(E). 2.5 After hearing both parties and perusing the materials available on record, we noticed that an application for registration u/s 12AB of the Act was rejected by the ld CIT(E) on following grounds:- * Non – Registration with RPT Act, 1959 In the course of hearing of the case, it is requested by the ld.AR of the assessee that he had complied with the instructions of the ld. CIT(E) and supplied all the documents demanded by the ld. CIT(E) but it appears that the same has not been properly examined by the ld CIT(E). He submitted that from the records it can be seen the genuineness of the activities of the trust and also its objects. It is also noteworthy to mention that the assessee trust has submitted the copy of the Trust under RPT Act, 1959 and the same is issued on 17-02-2025 by Devsthan Vibhag Jaipur Khand, Jaipur.He prayed that one more chance should be given to the assessee trust to re-submit or argue the case before the ld. CIT(E) so that he will be in a position reappraise the case to the ld. CIT(A). The Bench adopts the lenient view and feels that the assessee should be given one more opportunity to advance the documents before the ld. CIT(E) as to registration of the trust u/s 12AB of the Act. Hence, in view of all the facts and circumstances of the case, the matter is restored to the file of the ld CIT(E) for afresh adjudication by providing adequate opportunity of being heard and the assessee is also required to submit the documents as demanded by the ld. CIT(E) with regard to registration of the Trust u/s 12AB of the Act. Thus this appeal of the assessee is allowed for statistical purposes.

2.6 Since we have restored the appeal of the assessee with regard to the registration u/s 12AB of the Act to the file of the ld. CIT(E) for afresh adjudication, therefore, the outcome of appeal of the assessee u/s 80G of the Act is consequential in nature. 2.7 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.

3.0 In the result, both the appeals of the assessee are allowed for statistical purposes. Order pronounced in the open court on 05 /05/2025.

Sd/- Sd/- ¼jkBkSM+ deys'k t;UrHkkbZ ½ ¼MkWa-,l-lhrky{eh½ (RATHOD KAMLESH JAYANTBHAI) (Dr. S. Seethalakshmi) ys[kk lnL; @Accountant Member U;kf;dlnL;@Judicial Member Tk;iqj@Jaipur fnukad@Dated:- 05 / 05 /2025 *Mishra आदेश की प्रतिलिपिअग्रेf’ात@ब्वचल वf जीम वतकमत वितूंतकमक जवरू 1. vihykFkhZ@The Appellant- Kidney Patients Welfare Society,Jaipur 2. izR;FkhZ@The Respondent- The CIT (E). 3. vk;djvk;qDr@CIT 4. विभागीय प्रतिनिधि] आयकरअपीलीय अधिकरण] जयपुर@क्त्ए प्ज्Aज्ए Jंपचनत. 5. xkMZQkbZy@Guard File {ITA No. 311 & 312/JPR/2025} vkns'kkuqlkj@By order

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