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Facts
The assessee filed appeals against the order passed by the CIT(E) rejecting their application for registration under section 12A and approval under section 80G. The rejection was primarily due to the assessee's failure to provide documentary evidence regarding the genuineness of its activities and compliance with the law.
Held
The Tribunal condoned the delay in filing the appeal due to the death of the assessee's Chartered Accountant and restored both matters to the file of the CIT(E) for de novo consideration. The CIT(E) was directed to provide the assessee with an opportunity of being heard.
Key Issues
Whether the CIT(E) erred in rejecting the application for registration under Section 12A and approval under Section 80G without affording an opportunity of being heard, and whether the reasons for non-compliance were sufficiently explained.
Sections Cited
12A(1)(ac)(iii), 12A, 12AB, 80G
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Income Tax Appellate Tribunal, SURAT BENCH, SURAT
Before: SHRI SIDDHARTHA NAUTIYAL & SHRI BIJAYANANDA PRUSETH
O R D E R PER SIDDHARTHA NAUTIYAL - JUDICIAL MEMBER:
These are appeals filed by the Assessee against the order passed by the Ld. Commissioner of Income Tax (Exemption), (in short “Ld. CIT(E)”), Ahmedabad vide order dated 03.09.2024 & 21.11.2024. Since common facts and issues for consideration are involved for both the years under consideration, both the appeals filed by the assessee are being taken up for together.
We shall first start with appeal of the assessee in 2. The assessee has raised the following grounds of appeal:
&18/Srt/2025 Aadivasi Sampsabha Charitable Trust vs. CIT(E) Asst. Years –N.A. - 2– “1. The appellant request for condonation of delay in filling appeal. The appellate order under section 12A(1)(ac)(iii) passed by CIT(Exemption), Ahmedabad was received on 03.09.2024 and as such appeal was due to be filled on or before 01.11.2024 application for condonation of delay is being separately filled affirming the reason for delay in filling the appeal. Thus, it is requested to please condone the delay in filling the appeal, considering ill health of our Chartered Accountant which cause the death of our Chartered Accountant, and admit it for adjudication on facts and merit of the case and obliged.
That on the facts and in law, the learned CIT(Exemption) erred in rejecting the appellant's application for registration under sub clause (iii) of clause (ac) of sub- section (1) of section 12A of the income tax act, 1961, without providing an opportunity of being heard.
That the learned CIT(Exemption) has erred in passing the rejection order without considering the bona fide reason for non-compliance with the initial notice and the genuine efforts of the appellant to seek registration under sub clause (iii) of clause (ac) of sub-section (1) of section 12A.
That the appellant humbly submits that the learned CIT(Exemption) failed to consider the charitable nature of the trust's activities which includes distribution of foods, cloths & education kit to orphan children and poor people and that the rejection order is contrary to the principle of natural justice.
That the appellant is therefore prayed that order of CIT(Exemption), passed U/s. 12AB of the Income tax Act, 1961 may please be cancelled and registration may be granted or matter may be set aside to the file of CIT(E) with appropriate direction.
The appellant reserves right to add, alter, vary any or all grounds of appeal
s.”
3. The brief facts of the case are that the Applicant trust had applied for registration under section 12A of the Act, which was rejected by CIT (Exemptions) on the ground that the assessee/applicant trust has failed to file documentary evidences to enable him to satisfy about the genuineness of the activities of the trust, that the activities of the applicant trust are in consonance with the objects of the trust and whether the applicant trust had complied with the laws that are required to be complied with, for achieving the objects of trust.
&18/Srt/2025 Aadivasi Sampsabha Charitable Trust vs. CIT(E) Asst. Years –N.A. - 3– 4. The assessee is in appeal before us against the aforesaid order passed by CIT (Exemptions) and before us, during the course of hearing the counsel for the assessee submitted that that only two notices of hearing were issued to the assessee/ applicant trust, after which the application for registration of the assessee under section 12A of the Act was rejected by the CIT(Exemptions). The counsel for the assessee submitted that the reason for non-compliance of the notices by the assessee trust was due to ill health of their Chartered Accountant, which is also affirmed by the assessee in their application for condonation of delay. The Counsel for the assessee submitted that if given an opportunity of hearing, the assessee shall promptly and diligently comply with all notices of hearing and furnish all necessary details as called for by the concerned CIT (Exemptions).
Accordingly, looking into the instant facts, in the interest of justice, the delay in filing of the present appeal is hereby condoned and the matter is hereby restored to the file of CIT (Exemptions) for de novo consideration, after giving due opportunity of hearing to the assessee. However, we make it clear that in case the assessee still continues to remain non-compliant in response to notices issued by CIT (Exemptions), then he would be at liberty to pass appropriate orders, on the basis of materials available on record, in accordance with law.
In the result, the appeal of the assessee is allowed for statistical purposes.
ITA Nos.16&18/Srt/2025 Aadivasi Sampsabha Charitable Trust vs. CIT(E) Asst. Years –N.A. - 4– 7. We shall now deal with the assessee’s appeal in which is connected to the aforesaid appeal. The assessee has raised the following grounds of appeal:
“1. The Ex Parte ordered passed for rejection of approval U/s. 80G is illegal, invalid and bad in law.
That on the facts and in law, the learned CIT(Exemption) erred in rejecting the appellant's application for registration under clause (iii) of sub-section (5) of section 80G of the income tax act, 1961, without providing an opportunity of being heard.
That the learned CIT(Exemption) has erred in passing the rejection order without considering the bona fide reason for non-compliance with the initial notice and the genuine efforts of the appellant to seek registration under (iii) of sub-section (5) of section 80G.
That the appellant humbly submits that the learned CIT(Exemption) failed to consider the charitable nature of the trust's activities which includes distribution of foods, cloths & education kit to orphan children and poor people and that the rejection order is contrary to the principle of natural justice.
That the appellant is therefore prayed that order of CIT(Exemption), passed U/s. 80G of the Income tax Act, 1961 may please be cancelled and registration may be granted or matter may be set aside to the file of CIT(E) with appropriate direction. The appellant reserves right to add, alter, vary any or all grounds of appeals.” 6.
8. This appeal is with regards to rejection of grant of deduction under section 80G of the Act. In this case, the reason for rejection of application under section 80G of the Act was that the assessee trust failed to file documentary evidences to satisfy the CIT (Exemptions) about the genuineness of the activities of the trust and also whether conditions laid down in section 80G of the Act have been fulfilled by the assessee trust.
&18/Srt/2025 Aadivasi Sampsabha Charitable Trust vs. CIT(E) Asst. Years –N.A. - 5–
We observe that since in the preceding paragraphs we have restored the matter regarding grant of registration under section 12A of the Act to the file of CIT (Exemptions), for de novo consideration, accordingly, it is directed that the application for grant of approval under section 80G of the Act, is also hereby directed to be restored to the file of CIT (Exemptions), for de novo consideration.
In the result, both the appeals filed by the assessee/applicant trust are allowed for statistical purposes. Order pronounced under proviso to Rule 34 of ITAT Rules, 1963 on 06/05/2025
Sd/- Sd/- (BIJAYANANDA PRUSETH) (SIDDHARTHA NAUTIYAL) ACCOUNTANT MEMBER JUDICIAL MEMBER Ahmedabad; Dated 06/05/2025 TANMAY, Sr. PS TRUE COPY आदेश की �ितिलिप अ�ेिषत/Copy of the Order forwarded to : अपीलाथ� / The Appellant 1. 2. ��थ� / The Respondent. 3. संबंिधत आयकर आयु� / Concerned CIT आयकर आयु�(अपील) / The CIT(A)- 4. 5. िवभागीय �ितिनिध, आयकर अपीलीय अिधकरण, सूरत / DR, ITAT, Surat 6. गाड� फाईल / Guard file. आदेशानुसार/ BY ORDER,
उप/सहायक पंजीकार (Dy./Asstt.Registrar) आयकर अपीलीय अिधकरण, सूरत/ ITAT, Surat