SHREE STHANAKVASI JAIN SANGH,INDORE vs. CIT EXEMPTION, BHOPAL, BHOPAL
Facts
The assessee, a society, applied for regular registration under Section 12AB and approval under Section 80G. Their application was rejected by the CIT(Exemption) on grounds of incomplete documentation and lack of prior 12AB registration. This rejection was challenged before the ITAT and remanded.
Held
The Tribunal noted that the assessee's prior application for registration under Section 12AB was rejected, which is a prerequisite for 80G approval. However, considering the undertaking by the assessee's AR to provide all necessary details, the Tribunal set aside the impugned order and remanded the matter back to the CIT(E) for a fresh decision on a de novo basis.
Key Issues
Whether the rejection of application for registration under Section 12AB and 80G by the CIT(E) was justified and if the matter should be remanded for fresh consideration based on an undertaking to provide complete documents.
Sections Cited
253, 1961, 12AB, 80G, 10AC, 10AB, 11, 12, 23AA, 23C, 10.22
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, INDORE BENCH, INDORE
Before: SHRI BHAGIRATH MAL BIYANI, ACCOUNTANT & SHRI PARESH M JOSHIMEMBER
आदेश / O R D E R
Per Paresh M Joshi, J.M.:
This is an appeal filed by the assessee Under Section 253 of
the Income Tax Act, 1961 (hereinafter referred to as the ‘Act’ for
sake of brevity) before this Tribunal. The assessee is aggrieved by
the order bearing Number ITBA/EXM/F/EXM45/2024-
25/10711257438(1)dated 16.12.2024 of the Ld. CIT(Exemption),
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Shri Sthankvasi Jain Sangh ITA No. 93/Ind/2025 AY 2024-25 Bhopal, M.P. which is hereinafter referred to as the “impugned
order”.
FACTUAL MATRIX
2.1 The appellant is a Society, registered under the Madhya
Pradesh Societies Registration Act, 1973 vide provisional
Registration No. AAYTS3286QE20211 from AY 2022-23 to AY
2024-25 through order of CIT exemption dated 05/04/2022.
2.2 The objective of the Society is to run educational and social
and spiritual activities and also to construct and operate nursery,
primary, middle, high school, higher secondary and college at
educational level and hostels. To arrange scholarships and books
for the study of poor, weaker section and talented students of the
society. To make arrangements for treatment of low-income group
members of society, sadhus and mahatmas when they become
unwell and working for animals and birds (for kindness to
animals), also for work related to the upliftment and welfare of
women, children and youth of the society.
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Shri Sthankvasi Jain Sangh ITA No. 93/Ind/2025 AY 2024-25 2.3 The assessee applied for regular registration under clause (iii)
of sub-section C of section 12AB(1) of the act, as per the new
provision of Income Tax Act, 1961 in Form 10AB on 30
September 2023 via Ack No. 373639010300923.
2.4 Consequently, opportunity letters were issued and various
documents/details were called for; to process the said application
on 05 December 2023 but due to portal issues, assessee could
not access to the same on time. On 18 January 2024 assessee
submitted the response along with the documents.
2.5 On 19 February 2024 assessee again received notice seeking
last 3 financial year donation and other requisitions were made.
However, assessee responded with all the documents on 26
February, 2024.
2.6 Suddenly on 4th March 2024 assessee received the rejection
order in Form No. 10AD stating that –
- address and mobile number of the Donor has not been
submitted.
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Shri Sthankvasi Jain Sangh ITA No. 93/Ind/2025 AY 2024-25 - Complete address and direction from the donor or any
supporting documents of Corpus not Submitted.
- Proper details of subscriptions shown in Income &
Expenditure accounts not submitted.
and that order of rejection was issued. This order of
rejection of Ld. CIT (E) for regular registration was challenged
before ITAT which has remanded the matter back to CIT (E) (ITA
No.431/Ind/2024).
2.7 However on 16.12.2024 assessee received the rejection order
in Form 10AD stating that-
The assessee has applied in Form 10AB for registration u/s 80G(5)(iii) under the now provision of Income Tax Act, 1961. Consequently, opportunity letter was issued to the assessee and various documents/details were called for, to process the said application and to verify the eligibility of the assessee. The assessee has submitted his reply during the proceedings. 2. On perusal of record, it is found that application for registration u/s 12AB has already been rejected vide this office order dated: 04.03.2024 and hence, provisional registration accorded by the CPC In Form 10AC has also been cancelled. 3. For issuing of registration u/s 80G, it is prerequisite to possess exemption certificate for its income. The relevant provision of the act is mentioned below for reference: 80G. (1) In computing the total income of an assessee, there shall be deducted, in accordance with and subject to the provisions of this section,-
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Shri Sthankvasi Jain Sangh ITA No. 93/Ind/2025 AY 2024-25
(5) This section applies to donations to any institution or fund referred to in 2(a)(iv), only If It is established in India for a charitable purpose and if it fulfills the following conditions, namely:- (i) where the Institution or fund derives any income, such income would not be liable to Inclusion in its total Income under the provisions of sections 11 and 12 or clause (23AA) or clause (23C) of section 10.22 4. As the assessée doesn't have registration u/s 12AB w which is a prerequisite for obtaining approval u/s 80G, assessee is not eligible to obtain approval u/s 80G(5)(iii) of the Act. 5.Considering the facts of the case and reasons mentioned above and compulsory provisions of the Act, the application of the assessée filed in Form 10AB for grant of registration u/s 80G(6) of the Act is hereby rejected. 6. The provisional approval u/s 80G(5) in Form 10AC granted by CPC is also hereby cancelled as per the second proviso to Section 80G(5) of the Act.”. [ The impugned order) supra.
Record of Hearing
3.1 The hearing in the matter took place before us on
26.03.2025, when the Ld. AR for and on the behalf of the
assessee interalia contended that “Impugned Order” of Ld.
CIT(E) is in violation of principles of natural justice and is
therefore bad in law, illegal and not proper. Further issue of final
registration is pending before CIT(E) on remand from ITAT
(supra). Therefore impugned order deserves to be set aside by
this Tribunal in exercise of its appellate jurisdiction too.
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Shri Sthankvasi Jain Sangh ITA No. 93/Ind/2025 AY 2024-25 4. Observations,findings & conclusions.
4.1 We now have to decide the legality, validity and proprietary
of the “Impugned Order” basis records of the case and
contentions canvassed before us.
4.2 We have minutely perused records of the case and have
heard the rival submissions.
4.3 We are of the considered opinion that since Ld. AR has
under taken before us that the assessee would file all requisite
information/details before CIT (E) that it would be just fair and
convenient and in the interest of ends of justice that impugned
order be set aside and matter be remanded back to file of CIT(E)
to pass a fresh order on denovo basis after assessee has
submitted all details as sought. Hence we set aside the
“impugned order” as and by way of Remand on denovo basis.
Order
5.1 In the premises “impugned order” is set aside as and by
way of remand on denovo basis.
5.2 Appeal is allowed for statistical purpose.
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Shri Sthankvasi Jain Sangh ITA No. 93/Ind/2025 AY 2024-25
Order pronounced in open court on 26.03.2025.
Sd/- Sd/-
(BHAGIRATH MAL BIYANI) (PARESH M JOSHI) ACCOUNTANT MEMBER JUDICIAL MEMBER Indore िदनांक /Dated :26/03/2025 Dev/Sr. PS
Copies to: (1) The appellant (2) The respondent (3) CIT (4) CIT(A) (5) Departmental Representative (6) Guard File By order UE COPY Senior Private Secretary Income Tax Appellate Tribunal Indore Bench, Indore
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