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Facts
The assessee filed an e-application for registration under Section 80G of the Income Tax Act, 1961. The CIT (Exemption) rejected the application stating that the activities were not commensurate with the objectives of the trust and that incomplete information was provided.
Held
The Tribunal found that the CIT (Exemption) had rejected the application due to incomplete information without a speaking order. The Tribunal set aside the order and remanded the matter back to the CIT (Exemption) to grant an opportunity to the assessee to furnish complete information and then pass a speaking order.
Key Issues
Whether the rejection of the Section 80G registration application by the CIT (Exemption) was justified and whether a proper speaking order was passed.
Sections Cited
80G
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, CUTTACK BENCH AT KOLKATA
Before: SHRI DUVVURU RL REDDY(KZ) & SHRI RAKESH MISHRA
PER RAKESH MISHRA, ACCOUNTANT MEMBER:
This appeal filed by the assessee is against the order of the Ld. Commissioner of Income Tax (Exemption)-Hyderabad [hereinafter referred to as the ‘Ld. CIT (Exemption)’] passed in respect of registration u/s 80G of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) for AY 2025-26 dated 24.01.2025. I.T.A. No.: 96/CTK/2025 Assessment Year: 2025-26 Anchalik Janakalyan Anusthan.
The assessee is in appeal before the Tribunal raising the following grounds of appeal:
“1. That the Ld. Commissioner of Income Tax (Exemptions) erred in law and on facts in rejecting the application for registration under Section 80G of the Income Tax Act 1961 without providing a speaking order, despite the appellant fulfilling all statutory requirements and submitting requisite documents.
That the Ld. Commissioner of Income Tax (Exemptions) failed to appreciate that the activities of the trust are genuine and being carried out in accordance with the objectives stated in its bye-laws.
That the Ld. Commissioner (Exemption) has granted 12AB registration but failed to appreciate the genuineness of the activities and denied the 80G registration.
That the Learned Commissioner of Income Tax (Exemptions) incorrectly held that the appellant is not entitled to registration under Section 80G without providing cogent reasons or considering the documentary evidence and explanations provided during the proceedings.
That the rejection of the appellant’s application under Section 80G is arbitrary and unjustified as the trust/institution has been duly complying with all legal requirements and has not violated any conditions necessary for obtaining registration under Section 80G.
That the Learned Commissioner of Income Tax (Exemptions) has overlooked the documents submitted by the Appellant Viz. Cash book, Vouchers, Bank statement, Audited Balance Sheet, Activities Report, Registration certificate and Affidavit etc.
That the appeal be allowed on the above ground (s) or such other grounds if any will be urged at the time of hearing of the appeal.”
Brief facts of the case are that the assessee had filed an e- application in Form No.10AB seeking registration u/s 80G of the Act. A notice dated 10.10.2024 was issued to the assessee in respect of proceedings u/s 80G(5)(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 called for in the said notice. In response thereof the assessee submitted partial information. Another notice dated 19.12.2024 was issued to the assessee as a final I.T.A. No.: 96/CTK/2025 Assessment Year: 2025-26 Anchalik Janakalyan Anusthan. opportunity to furnish the details. The Ld. CIT (Exemption) rejected the registration of the assessee after holding as under:
“3. On perusal of the submissions made by the assessee, it is observed that activities are not commensurate with the activities as per objectives of the registered Deed/MOA/AOA, 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.”
Rival contentions were heard and the submissions made have been examined. The Bench was of the view after hearing the Ld. AR that the Ld. CIT(Exemption) had rejected the registration u/s 80G of the Act on account of furnishing incomplete information in response to the notice issued to the assessee as the genuineness of the activities of the Trust could not be verified while the assessee claims that the required documents were filed. Therefore, in the interest of justice, it was considered imperative that the assessee may be granted another opportunity to file remaining information in response to the notice issued by the Ld. CIT (Exemption) for justifying the genuineness of the activities of the trust for the claim of exemption. Hence, the order of the Ld. CIT (Exemption) is hereby set aside and the matter is remanded to him for deciding the application afresh after granting an opportunity of being heard to the assessee and considering the reply which may be filed and thereafter pass a speaking order in accordance with law.
In the result, the appeal filed by the assessee is allowed for statistical purposes. Order pronounced in the open Court on 12th June, 2025. [Duvvuru RL Reddy] [Rakesh Mishra] Vice President (KZ) Accountant Member Dated: 12.06.2025 Bidhan (P.S.) I.T.A. No.: 96/CTK/2025 Assessment Year: 2025-26 Anchalik Janakalyan Anusthan. Copy of the order forwarded to:
Anchalik Janakalyan Anusthan, 1, Bijapali, Mochida, Jharsuguda, Odisha, 768226. 2. Commissioner-of-Income Tax (Exemption), Hyderabad.
CIT(A)-NFAC, Delhi.
CIT-
CIT(DR), Cuttack Bench, Cuttack.
Guard File. //// By order