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Facts
The assessee applied for registration under sections 12AB and 80G of the Income Tax Act. The Ld. CIT(E) rejected the applications, citing non-compliance with notices seeking details and a lack of substantial charitable activities. The assessee filed an appeal, contending that the rejection was summary, casual, and without providing specific reasons or substantiated findings.
Held
The Tribunal found the Ld. CIT(E)'s order non-speaking, observing that it merely stated a lack of substantial charitable activities without specifying how the activities were non-charitable. In the interest of natural justice, the Tribunal set aside the impugned order and remanded the matter back to the Ld. CIT(E) to provide another opportunity to the assessee to furnish details and pass a speaking order on merits.
Key Issues
Whether the rejection of applications for registration under sections 12AB and 80G by the CIT(E) was justified when the order was non-speaking and lacked substantiated reasons regarding the assessee's charitable activities and compliance with information requests.
Sections Cited
12AB, 80G, 12A(1)(ac)(iii), 80G(5)(iii), 12A, 12AA
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Income Tax Appellate Tribunal, VISAKHAPATNAM “DIVISION” BENCH, VISAKHAPATNAM
Before: SHRI DUVVURU RL REDDY, HON’BLE & SHRI S BALAKRISHNAN, HON’BLE
आदेश /O R D E R
PER SHRI S BALAKRISHNAN, ACCOUNTANT MEMBER: 1. These appeals are filed by the assessee against the rejection order of Learned Commissioner of Income Tax (Exemption), Hyderabad [hereinafter in short “Ld.CIT(E)”] vide respective DIN &Notice No. as stated below: -
I.T.A.Nos. 4 & 5/VIZ/2025 Indo Human Rights Care &Notice No. Dated ITBA/EXM/F/EXM45/2024-25/1070994079(1) 07.12.2024 ITA No. 5/VIZ/2025 ITBA/EXM/F/EXM45/2024-25/1071094718(1) 11.12.2024
Since assessee is same and issues are common, both these appeals are clubbed and heard together and a consolidated order being passed.
Briefly stated facts of the case are, assessee has applied for Registration under section 12AB of Income Tax Act, 1961 (in short ‘Act’) and Registration under section 80G of the Act. Notices were issued in respect of proceedings under section 12A(1)(ac)(iii) and under section 80G(5)(iii) respectively, to produce memorandum of association / Trust deed for verification and to furnish a detailed reply on the specific information called for in the said notice. In response, assessee has submitted some of the details as called for. Subsequently, another notice was issued to the assessee to submit the full information as per the notices issued. In response, assessee furnished its reply in compliance to the notice issued by the Ld.CIT(E). Ld.CIT(E) rejected the application for permanent Registration under section 12A and 80G of the Act stating that the assessee has not complied with the notices issued calling for details.
On being aggrieved by the order of the Ld.CIT(E), assessee filed appeal before us by raising following grounds of appeal: -
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I.T.A.Nos. 4 & 5/VIZ/2025 Indo Human Rights Care 1) The order passed by the Commissioner of Income Tax (Exemptions) under Form 10AD dated 07-12-2024 is bad in law and contrary to the facts and circumstances of the case. 2) The learned CIT (Exemptions) erred in rejecting the application for registration under Section 12A of the Income Tax Act in a summary and casual manner without substantiating the reasons for such refusal. 3) The learned CIT (Exemptions) observed that the appellant trust had not carried out any substantial charitable activities. However, this observation was made without providing specific reasons or substantiated findings to support such an adverse conclusion. 4) In any case, the learned CIT (Exemptions) ought not to have rejected the claim for registration without cogent and detailed reasons, especially when the trust's activities align with charitable objectives as outlined under the Act. 5) For these and other reasons that may be urged at the time of hearing, the appellant prays that the impugned order dated 07.12.2024 be set aside in the interest of justice, and the registration under section 12AA of the Income Tax Act. 1) The order passed by the Commissioner of Income Tax (Exemptions) under Form 10AD dated 11-12-2024 is bad in law and contrary to the facts and circumstances of the case. 2) The learned CIT (Exemptions) erred in rejecting the application for registration under Section 80G of the Income Tax Act in a summary and casual manner without substantiating the reasons for such refusal. 3) The learned CIT (Exemptions) observed that the appellant trust had not carried out any substantial charitable activities. However, this observation was made without providing specific reasons or substantiated findings to support such an adverse conclusion. 4) In any case, the learned CIT (Exemptions) ought not to have rejected the claim for registration without cogent and detailed reasons, especially when the trust's activities align with charitable objectives as outlined under the Act.
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I.T.A.Nos. 4 & 5/VIZ/2025 Indo Human Rights Care 5) For these and other reasons that may be urged at the time of hearing, the appellant prays that the impugned order dated 11.12.2024 be set aside in the interest of justice, and the registration under section 80G of the Income Tax Act.”
The only issue raised by the assessee is with respect to rejection of Registration under section 12A and 80G of the Act by the Ld.CIT(E). Ld.CIT(E) vide its order in Form 10AD dated 07.12.2024 & 11.12.2024 has stated that the assessee has not submitted full details for verification.
At the outset, Ld. Authorized Representative (hereinafter in short “Ld.AR”] submitted that Ld. CIT(E) has not passed a speaking order for the denial of registration to the assessee. He further submitted that various documentary evidences have been provided before Ld. CIT(E) but he has casually observed the no substantial activities which are charitable in nature are being carried out by the assessee. He therefore pleaded that one more opportunity may be provided to the assessee to submit its reply with documentary evidences once again to the Ld.CIT(E).
On the other hand, Ld. Departmental Representative [hereinafter in short “Ld. DR”] heavily relied on the order of the Ld. CIT(E).
We have heard both the sides and perused the material available on record. The assessee responded to the notices issued by the Ld.CIT(E) but it is observed from the order of the Ld.CIT(E) that the assessee has partly
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I.T.A.Nos. 4 & 5/VIZ/2025 Indo Human Rights Care responded. We find that Ld. CIT(E) while rejecting the application in Form10AB for the purpose of Registration of the society under section 12AB & 80G of the Act has observed as follows: -
“12AB Registration rejected observing as under: - 3. On perusal of the submissions made by the assessee, it is observed that no substantial activities which are charitable in nature are being carried out by the assessee, which is in violation of the provisions of the section 12AB of the IT Act, 1961. In view of the above, the present application in form 10AB for registration u/s 12AB is herewith rejected.” 80G Registration rejected observing as under: - “3. On perusal of the submissions made by the assessee, it is observed that no substantial activities which are charitable in nature are being carried out by the assessee, which is in violation of the provisions of the section 80G of the IT Act, 1961. In view of the above, the present application in form 10AB for registration u/s 80G is herewith rejected..”
On a perusal of the Ld. CIT(E) order, we find that he has not discussed anything except stating that the no substantial activities which are charitable in nature are being carried out by the assessee. Ld. CIT(A) has not specified how the assessee’s activities cannot be deciphered as charitable in nature. Ld.CIT(E) has simply rejected the assessee’s application which, in our considered opinion is not correct. Therefore, in the interest of natural justice, we find it appropriate to grant another one more opportunity to the assessee to submit the relevant documents including the evidences as detailed in the notices. Accordingly, we grant one more opportunity to the assessee and thereby set-aside the impugned order and restore the matter back to the file of Ld.CIT(E) with a direction to Page. No 5
I.T.A.Nos. 4 & 5/VIZ/2025 Indo Human Rights Care provide one more opportunity to the assessee to furnish required details and to decide the case on merits by passing a speaking order. Assessee is also directed to fully cooperate and furnish necessary documents / information as required by the Ld.CIT(E).
In the result, both the appeal of the assessee is allowed for statistical purposes.
Order pronounced in the open court on 28th August, 2025.
Sd/- Sd/- (दुव्वूरु आर एल रेड्डी) (एस बालाकृष्णन) (S. BALAKRISHNAN) (DUVVURU RL REDDY) उपाध्यक्ष / VICE PRESIDENT लेखा सदस्य/ACCOUNTANT MEMBER Dated: 28.08.2025 Giridhar, Sr.PS आदेशकीप्रनतनलनपअग्रेनर्त/ Copy of the order forwarded to:- 1. निर्धाररती/ The Assessee : Indo Human Rights Care D.No. 11-240/1 Krishnanagar Durganagar POS Naidu Thota, Pendurthi Mandal Visakhapatnam – 530029 Andhra Pradesh 2. रधजस्व/ The Revenue : Income Tax Officer-Exemption Income Tax Office Infinity Towers Shankarmatam road, Visakhapatnam 3. The Principal Commissioner of Income Tax 4. नवभधगीयप्रनतनिनर्, आयकरअपीलीयअनर्करण, नवशधखधपटणम /DR,ITAT, Visakhapatnam 5. The Commissioner of Income Tax 6. गधर्ाफ़धईल / Guard file आदेशधिुसधर / BY ORDER Sr. Private Secretary ITAT, Visakhapatnam
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