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Facts
The assessee's application for final registration under section 12AB of the Income Tax Act was rejected by the CIT(E), Bhopal, and its provisional registration was cancelled. The assessee appealed this order, arguing that the rejection was made without a proper opportunity of being heard and was thus against natural justice.
Held
The Tribunal restored the matter back to the file of the CIT(E) for fresh adjudication. The CIT(E) was directed to grant a necessary opportunity of hearing to the assessee and pass an appropriate order, while the assessee was directed to participate in the hearings without seeking unnecessary adjournments.
Key Issues
Whether the rejection of registration under Section 12AB without providing a reasonable opportunity of hearing violates the principles of natural justice.
Sections Cited
12AB, 12A(1)(ac)(iii)
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Income Tax Appellate Tribunal, INDORE BENCH, INDORE
आदेश/ O R D E R
Per B.M. Biyani, A.M.:
Feeling aggrieved by order dated 25.07.2024 passed by learned Commissioner of Income-Tax (Exemption), Bhopal [“CIT(E)”] having DIN: ITBA/EXM/F/EXM45/2024-25/1067029217(1) by which the assessee’s application for grant of final registration u/s 12AB of Income-tax Act, 1961 has been rejected and the provisional registration granted earlier vide order dated 06.05.2023 has also been cancelled, the assessee has filed this appeal on following grounds:
Gurudwara Shri Guru Angaddevji Sahebji Nyas “1.That on the facts and in the circumstances of case Ld. CIT(E), Bhopal has erred in rejecting the application for registration 12A(1)(ac)(iii) U/s filed in Form 10AB without affording reasonable opportunity of being heard is bad in law as the said order is passed against the principles of natural justice.
2. That the impugned order so passed is illegal and wrong. 3.That the assessee craves leave to add, amend, alter or delete any of the grounds of appeal and all the grounds are without prejudice to each other.”
Ld. AR for assessee firstly carried us to the impugned order. He would demonstrate that the CIT(E) has acknowledged that the assessee filed certain information/documents in response to the notice issued but, however, did not file reply to the notice dated 09.07.2024 seeking further information of corpus donations received during last three financial years.
Ld. AR next submitted that the Balance-Sheet of assessee as on 31.03.2024 shows total corpus donations received uptill 31.03.2024 amounting to Rs. 70,50,000/-. He submitted that the assessee has already collected the letters of M/s Satyanshu Trading Company and M/s Manoj Trading Company who had given corpus donations of Rs. 40,00,000/- and Rs. 30,00,000/- to assessee and for remaining corpus donation of Rs. 50,000/-, the efforts are being made to collect further evidences from concerned donors. Ld. AR submitted that the assessee is constructing a gurudwara and corpus donations were received therefor. He submitted that although on the date of hearing fixed by Ld. CIT(E), the assessee was not able to file evidences of corpus donations but now it is ready to file evidences and satisfy the CIT(E). He submitted that the registration u/s 12A is very important for assessee and the assessee would find it extremely difficult to Page 2 of 4
Gurudwara Shri Guru Angaddevji Sahebji Nyas achieve the charitable/religious object in absence of registration. Therefore, in the interest of justice, the present matter must be restored at the level of CIT(E).
Ld. DR for revenue agreed with the proposal made by Ld. AR for restoration of this case at the level of CIT(E). However, he requested that the assessee should be directed to make representation before CIT(E) without seeking unnecessary adjournments.
Considering above submissions and also having regard to the principle of natural justice and fair play, we deem it fit to remand this matter back to the file of CIT(E) for adjudication afresh. The CIT(E) shall give necessary opportunity of hearing to assessee and pass an appropriate order.
The assessee is also directed to ensure participation in the hearings as may be fixed by CIT(E) and do not seek unnecessary adjournments failing which the CIT(E) shall be at liberty to pass appropriate order in accordance with law. Ordered accordingly.
Resultantly, this appeal is allowed for statistical purpose.