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Income Tax Appellate Tribunal, DELHI BENCH ‘F’, NEW DELHI
Before: SH. PRADIP KUMAR KEDIA & SH. SUDHIR KUMAR
Date of hearing: 03/03/2025 Date of Pronouncement: 03/03/2025 ORDER PER SUDHIR KUMAR, JUDICIAL MEMBER:
This appeal is preferred by the assessee is against the order 23-07-2024 of the Commissioner of Income Tax (Exemption) Delhi [hereinafter referred to as “CIT(E)”] rejecting the request for approval pertaining to assessment year 2024-25, under section 12 A of the Income Tax Act, 1961 [herein after, the Act]. 2.The appeal is time barred by 42 days. An application has moved to condone the delay. Ground is sufficient and delay is condoned. Appeal is admitted for hearing. 3.The assessee has raised the following grounds in appeal:
1. That on the facts and circumstances of the appellant's case, Hon'ble CIT (Exemption), Delhi erred in rejecting the application filed in Form10AB vide order passed under section 10AD on 23.07.2024 along with provisional registration granted under sub clause (iv) of first proviso to sub-section (5) of section 80G of the Income Tax Act, 1961 vide UR No. AABAP2210RF20210 valid from 27.11.2021 to A.Υ 2024-25 arbitrarily and prejudicially without considering the submission and information submitted by the appellant only on the basis of conjecture and surmises. Thus, rejection of application and cancellation of provisional registration is completely bad in law and liable to be quashed.
That on the facts and circumstances of the appellant's case, Hon'ble CIT (Exemption), Delhi erred in rejecting the application filed in Form10AB vide order passed under section 10AD on 23.07.2024 along with provisional registration granted under sub clause (iv) of first proviso to sub-section (5) of section 80G of the Income Tax Act, 1961 vide UR No. AABAP2210RF20210 valid from 27.11.2021 to A.Y 2024-25 without adhering to the principles of natural justice. The appellant was not provided an adequate opportunity to be heard or present their case before the rejection was made. This denial of a fair hearing constitutes a violation of the basic principles of natural justice, rendering the order unjust and unfair. Thus, rejection of application and cancellation of provisional registration is completely bad in law and liable to be quashed.
The brief facts of the case are that appellant/assessee is a registered society under the Societies Registration Act of XXI, 1860. The assessee applied for provisional registration under section 12 A and 80G (5) of the Act on the Form 10A which was granted on 27-11-2021 from the Assessment Year 2022-23 to 2024-25. Thereafter the assessee applied for permanent registration under section 12A (1) (ac) (iii) of the Act in the prescribed Form 10AB of the Income Tax Rules on 19-01-2024. The CIT(E) rejected the said application as the assessee has failed to file necessary details in support of the genuineness of the activities and the assessee not registered himself on DARPAN Portal of the NITI Aayog which is the mandatory requirement for the Non-Profit Organization as per the PMLA Rules 2023. The Ld. CIT(E ) has observed in his order as under: 5. In view of the above, the applicant has failed to file the necessary details in support of the genuineness of the activities and other issues as discussed above. Hence, the conditions laid down in the section 12AB are not fulfilled. Moreover, the Society / trust is also not registered on DARPAN Portal of NITI Aayog, which is a mandatory registration for the NPOs (Non-profit Organization) as per the PMLA Rules 2023 (Prevention of Money-Laundering Amendment Rules, 2023 Rule 9A. Therefore, the application filed on 19.01.2024 in Form 10AB for grant of registration u/s 12A(1)(ac) (iii) of the Income Tax Act, 1961 is hereby rejected.
6. Since, the application filed in Form 10AB seeking registration under section 12A is rejected, the provisional registration granted vide order dated 27.11.2021 having Unique Registration Number AABAP2210RE20212 for the period from A.Y. 2022-23 to A.Υ. 2024-25 is also cancelled. 5. Aggrieved the order of the Ld. CIT(E) the assessee has filed this appeal before the tribunal.
The Ld. AR of the assessee has argued that the Ld. CIT (E) has wrongly cancelled the application and provisional registration without assigning any reasons. He has also submitted that the assessee has provided the documents and details of the accounts before the Ld. CIT (E ) to prove that the assessee is engaged in the charitable activities. The assessee has also filed the details of the registration of the trust on Darpan Portal of Niti Aayog.
Ld. CIT-DR supported the order of the Ld. CIT (E) and sought the dismissal of the appeal. 8.We have heard both the parties and perused the material available on the record. We find force in the argument of the Ld. AR that the Ld CIT( E) has passed the order without considering the documents filed by the assessee and without discussing the details of questionnaire which he wanted to be supplied by the assessee. In the interest of justice and fair play we restore the matter back to the learned CIT(E) to decide as a fresh after giving the opportunity of being heard to the appellant. The assessee is also directed to co-operate with the authority. 9. In the result the appeal of the assessee is allowed for statical purpose. Order pronounced in the open court on 03.03.2025.