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Facts
The assessee, Siba Foundation, a charitable trust, applied for permanent registration under Section 12AB of the IT Act for its school. The CIT(E) rejected the application, stating that the trust's activities were not commensurate with its objectives and that no reasonable opportunity was provided.
Held
The Tribunal held that while the assessee had been granted provisional registration, the CIT(E) rejected the application for permanent registration without providing sufficient opportunity for the assessee to furnish all relevant documentary evidence.
Key Issues
Whether the CIT(E) rightly rejected the application for permanent registration without affording adequate opportunity to the assessee to submit documents.
Sections Cited
12A, 12A(1)(ac)(iii), 12AB
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Income Tax Appellate Tribunal, CUTTACK BENCH, CUTTACK
Before: S/SHRI DUVVURU RL REDDY(KZ) & RAJESH KUMAR
Assessment Year : 2025-26 Siba Foundation Vs. ITO, Exemption, Cuttack Somapur, P.S.- Kisan Nagar, Somapur, Cuttack- 754130 PAN/GIR No. AAWTS 3027 R (Appellant) .. ( Respondent) Assessee by : Shri Natabar Panda, Adv Revenue by : Shri Ashim Kr Chakraborty, CIT DR Date of Hearing : 01 /07/2025 Date of Pronouncement : 01/07/2025 O R D E R Per Bench The present appeal is directed at the instance of assessee against the order of ld. Commissioner of Income Tax (Exemption), Hyderabad dated 18/03/2025 in Appeal No. CIT(EXMPTION),HYD/2024-25/12AA/13676 passed for Assessment Year 2025-26.
Facts in brief of the case are that the assessee is a charitable trust created under the Indian Trust 1882 on 13th July, 2018. The appellant trust is running a senior secondary school from Class-1 to 12 under the name
P a g e 1 | 4 and style “Utkal International School” at Banipada, PO: Chasapada, Dsit: Cuttack for the students having obtaining approval from the Government for the period 1.4.2023 to 31.3.2028. The appellant trust has got provisional registration from the ld CIT(E), Hyderabad under section 12A of the Act on 4.4.2024. The main object of the Trust is to establish, maintain , expand, build, manage and support or help, administer, institutions, primary, nursery, secondary higher secondary schools, colleges, law colleges, medical colleges, meeting halls, libraries, reading rooms, training and research house, etc. The assessee trust has filed an e-application in Form No.10AB seeking registration u/s.12AB of the I.T.Act. The ld CIT(E) issued notice on 23.1.2025 in respect of proceedings u/s.12A(1)(ac)(iii) of the Act to produce the copy of Memorandum of Association/Trust deed for verification and to furnish a detailed reply on the specific information. In response to the said notice, the appellant trust did not furnish any information. Therefore, the ld CIT(E) observed that the activities of the trust are not commensurate with the activities as per objectives of the registration deed/MAO/AOA and accordingly, rejected the application for registration u/s.12AB of the Act. Hence, the assessee has filed appeal before the Tribunal.
At the time of hearing, ld AR of the assessee submitted that in response to notice for granting permanent registration, the appellant submitted all the documents in the portal, however, without affording
P a g e 2 | 4 reasonable opportunity to the assessee, tbe ld CIT(E) rejected the application for grant of registration to the assessee. He submitted that the ld CIT(A) could have afforded some more opportunities to verify all the documents including activities report in physical mode. He prayed for restoring the matter to the file of the ld CIT(E) again for verification of the documentary evidence in support of the grant of registration of the Trust.
In reply, ld CIT DR supported the order of the ld CIT(E).
We have considered the rival submissions and perused the record of the case. It is an undisputed fact that the assessee has been granted provision registration u/s.12AB of the Act by the ld CIT(E). However, for granting permanent registration, the assessee has filed application in Form No.10AB. Although the assessee has filed required documents in the portal of the department, according to ld CIT(E), they were not commensurate with the activities as per objectives of the registered Deed/,MOA/AOA and without giving reasonable opportunity to the assessee, ld CIT(E) rejected the application for grant of registration. Before us, ld AR prayed that if one more opportunity is given, the assessee will furnish all the relevant documentary evidence for grant of registration. Considering the request of the ld. AR that the assessee, in the interest of justice, we deem it proper to set aside the matter to the Ld. CIT(E) with a direction to allow another opportunity of being heard to the assessee and furnish the required
P a g e 3 | 4 documents for grant of registration u/s. 12AB of the Act. The assessee is also directed to make compliance before the Ld. CIT(E) and not to seek adjournment without any pressing reason. In case, the assessee fails to make compliance, the Ld. CIT(E) will be free to pass the order as he deems fit.
In the result, appeal of the assessee stands allowed for statistical purposes.
Order dictated and pronounced in the open court on 01/07/2025.
Sd/- Sd/- (RAJESH KUMAR) (DUVVURU RL REDDY) ACCOUNTANT MEMBER VICE PRESIDENT Cuttack: Dated 01 /07/2025 B.K.Parida, Sr. PS (OS) Copy of the Order forwarded to : 1. The Appellant : Siba Foundation Somapur, P.S.- Kisan Nagar, Somapur, Cuttack- 754130 2. The Respondent : ITO, Exemption, Cuttack 3. The CIT(A)-, 4. Pr.CIT- 5. DR, ITAT, Cuttack 6. Guard file. //True Copy// By order