ASRA FOUNDATION NAGPUR,NAGPUR vs. ITO WARD-1, EXEMP, NAGPUR

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ITA 60/NAG/2025Status: DisposedITAT Nagpur21 March 2025AY 2025-263 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the learned CIT(E) had rejected the assessee's applications due to non-compliance with statutory notices. The assessee's representative requested an additional opportunity to furnish the required details. The Tribunal, taking a sympathetic view towards small trusts and emphasizing the importance of affording full opportunity in the interest of natural justice, decided to set aside the impugned orders. The Tribunal directed the learned CIT(E) to adjudicate the matters on merits and in accordance with law, after providing a reasonable opportunity of being heard to the assessee. The ratio decidendi is that non-compliance due to oversight or a request for a short extension should not automatically lead to rejection without a fair hearing, especially for charitable trusts. The appeals were allowed for statistical purposes.

What were the facts?

The assessee, Asra Foundation, filed appeals before the Income Tax Appellate Tribunal (ITAT), Nagpur Bench, against orders dated 07/12/2024 passed by the learned Commissioner of Income Tax (Exemption), Pune. These orders rejected the assessee's applications filed in Form no. 10AD and Form no. 10AB(iii) under the first proviso to sub-section (5) of section 80G and section 12A(1)(ac) of the Income Tax Act, 1961, respectively. The rejection by the CIT(E) was reportedly due to non-compliance with statutory notices issued on 02/12/2024, requiring the assessee to furnish certain details and evidences. The appeals were consolidated for disposal due to interconnected issues.

What were the issues?

1. Whether the learned CIT(E) erred in rejecting the assessee's application in Form no. 10AD and Form no. 10AB(iii) without providing adequate opportunity for compliance, thereby violating principles of natural justice? (Question of law and fact, concerning Section 80G(5) and Section 12A(1)(ac) of the Act). Assessee's contention: The learned Authorized Representative for the assessee submitted that she would furnish the desired details/evidences if granted one more opportunity to substantiate the case before the learned CIT(E). Revenue's contention: No specific contentions were recorded for the revenue in the judgment.

Which sections of the Income-tax Act were involved?

Section 80G,Section 12A(1)(ac)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, NAGPUR BENCH, NAGPUR

Before: SHRI V. DURGA RAO & SHRI K.M. ROY, ACCOUNTANT, MEMBER

For Appellant: Ms. Alfiya Rozie
For Respondent: Shri Sandipkumar Salunke

Date of Hearing – 05/03/2025 Date of Order – 21/03/2025

O R D E R PER K.M. ROY, A.M.

Captioned appeal by the assessee is emanating from the impugned orders of even date 07/12/2024, passed by the learned Commissioner of Income Tax (Exemption), Pune, , [“learned CIT(E)”], in Form no.10AD, rejecting the application filed by the assessee in Form no.10AB(iii) of first proviso to sub–section (5) of section 80G of the Income Tax Act, 1961 ("the Act") and application filed by the assessee in Form no.10AB(iii) of section 12A(1)(ac) of the Act respectively.

2.

Since the issues involved in these appeals by the assessee are inter– connected, therefore, as a matter convenience, we proceed to dispose of these appeal by passing a consolidated order. & 61/Nag./2025

3.

The rejection was done by the learned CIT(E) vide impugned orders of even date 07/12/2024. It appears that there was no compliance to the statutory notices due on 02/12/2024, to furnish certain details / evidences. The learned Authorised Representative for the assessee submitted that she will furnish the desired details / evidences if given one more opportunity to substantiate its cases before the learned CIT(E). However, she failed to adduce any evidence / documents before us. It is pertinent to mention here that this Bench was always taken a sympathetic and lenient view that these types of small Trusts must be afforded full opportunity in the interest of natural justice to establish their cases. Accordingly, we set aside the impugned orders passed by the learned CIT(E) and direct him to adjudicate the matters on merits and in accordance with law after providing reasonable opportunity of being heard to the assessee.

4.

In the result, assessee’s appeals are allowed for statistical purposes. Order pronounced in the open Court on 21/03/2025

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