DAYA LAXMI CHARITABLE TRUST,DHARAMPUR, KASAULI, SOLAN vs. CIT (EXEMPTION), CHANDIGARH
Facts
M/s Daya Laxmi Charitable Trust filed an application for registration under Section 12A(i)(ac)(iii) of the Income-tax Act, 1961. The CIT (Exemptions) rejected this application, citing insufficient documentation to assess the genuineness of the trust's activities or its compliance with the stated objects. The assessee appealed this rejection to the ITAT.
Held
The Tribunal observed that the CIT(E) rejected the application due to unfulfilled document requirements, while the assessee contended that no notice for further evidence was received. To ensure natural justice and provide an adequate opportunity to be heard, the case was remanded back to the CIT(E) for a de-novo order, with the assessee directed to cooperate by providing necessary documents.
Key Issues
Whether the rejection of an application for registration under Section 12A(i)(ac)(iii) by the CIT(E) is valid if the assessee claims not to have received proper notice to furnish required documents for proving genuineness of activities.
Sections Cited
Section 12A(i)(ac)(iii) of the Income-tax Act, 1961
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “A” BENCH, CHANDIGARH
Before: HON’BLE SHRI RAJPAL YADAV & HON’BLE SHRI KRINWANT SAHAY, AM
IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, CHANDIGARH PHYSICAL HEARING BEFORE HON’BLE SHRI RAJPAL YADAV, VICE PRESIDENT AND HON’BLE SHRI KRINWANT SAHAY, AM आयकरअपीलसं./ ITA No.1639/CHANDI/2025 (िनधा�रणवष� / Assessment Year: 2026-27) M/s Daya Laxmi Charitable Trust CIT (Exemptions) बनाम/ Vs. SCO 80-81, Third Floor, CR Building, Sector-17C, Sector 17-C, Chandigarh - 160017 Chandigarh �ायीलेखासं./जीआइआरसं./PAN/GIR No. AAETD-5564-C (अपीलाथ�/Appellant) : (��थ� / Respondent) अपीलाथ�कीओरसे/ Appellant by : Sh. T.N. Singla (CA) ��थ�कीओरसे/Respondent by : Sh. Manav Bansal (CIT) Ld. DR सुनवाईकीतारीख/Date of Hearing : 26-02-2026 घोषणाकीतारीख /Date of Pronouncement 19-03-2026 : आदेश / O R D E R Krinwant Sahay (Accountant Member) 1. Appeal in this case has been filed against the order dated 04.11.2025 passed by the Ld. CIT (Exemptions), Chandigarh.
Grounds of appeal are as follows: 1. That the order of Ld. CIT(E) is bad against the law. 2. That the order of Ld. CIT(E) has wrongly rejected the application for registration u/s 12A(i)(ac)(iii).
That the order of Ld. CIT(E) has wrongly passed the order without issuing any notice in lieu of the order of Hon'ble ITAT dated 02.07.2025. 4. That the order of Ld. CIT(E) has rejected our application u/s 12A(i)(ac)(iii) without any show cause notice regarding missing regular charitable activities or any discrepancy in the submission made by the appellant. 5. That the order of Ld. CIT(E) is based on surmises and conjectures. 6. That the appellant craves leave to add, amend, alter or withdraw any ground of appeal before the final date of hearing.
The brief facts of the case are as under: An application for registration u/s 12A(i)(ac)(iii) of the Income-tax Act, 1961 (the Act) was filed by DAYA LAXMI CHARITABLE TRUST (the applicant) on 30.08.2025. On scrutiny of the above, it was found that the documents provided by the applicant were not sufficient for assessing the genuineness of the activities of the trust. It also could not be verified from the available documents whether the applicant is complying with the objects mentioned in the Trust deed or not. Therefore, the Ld. CIT(E) rejected the registration of the Trust u/s 12A(i)(ac)(iii) against the order of the CIT(E), the assessee has filed this appeal before us.
During proceedings before us, the Ld. Counsel of the Assessee argued that the Ld. CIT (Exemptions) rejected the application of the Assessee filed under Section 12A(i)(ac)(iii) without issuing any show cause notice regarding missing regular charitable activities or any discrepancy in the submissions made by the appellant and therefore, the Ld. counsel requested the Bench that the rejection order passed by the Ld. CIT(E) was bad in law. Accordingly, the Ld. counsel further requested that the matter may be remanded back to the CIT(E) for the de-novo order. On the other hand, the Ld. DR argued that the Ld. CIT(E) had
issued a questionnaire dated 17.09.2025 requesting the assessee to furnish documents, evidences online in order to verify whether activities of the applicant where in accordance with its objects, the guidelines of its activities and compliance with such requirements of any other law for the time being in force. In rebuttal, the Ld. Counsel of the Assessee argued that the Assessee had not received any such questionnaire from the Ld. CIT(E).
We have gone through the order of the Ld. CIT(E) and we have heard the arguments of the Ld. Counsel of the Assessee as well as that of the Ld. DR, we find that the Ld. CIT(E) has rejected the claim of the Assessee on the ground that the Assessee could not furnish the required documents in time to substantiate its claim of the charitable nature of the trust while the counsel of the assessee has claimed that through the assessee had furnished same documents but for further evidences, it did not receive any notice
Keeping in view, facts of the case and the element of natural justice we are of this considered view that the Assessee Trust deserves one more opportunity, accordingly, we remand this case back to CIT(E) to pass a fresh order after giving adequate opportunity to the Assessee of being heard. Simultaneously, the Assessee is directed not to take unnecessary adjournments and co-operate with the revenue in filing of the necessary documents and evidences in support of its claim. 7. In the result, Assessee’s appeal is allowed for Statistical purpose.
Order pronounced on 19-03-2026
-SD- -Sd- (RAJPAL YADAV) (KRINWANT SAHAY) VICE PRESIDENT ACCOUNTANT MEMBER AS Dated: 19-03-2026 आदेश की �ितिलिप अ�ेिषत /Copy of the Order forwarded to : 1. अपीलाथ�/Appellant 2. ��थ�/Respondent 3. आयकरआयु�/CIT 4. िवभागीय�ितिनिध/DR 5. गाड�फाईल/GF ASSISTANT REGISTRAR
ITAT CHANDIGARH
