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Facts
The assessee applied for registration under section 12A(1)(ac)(iii) of the Income Tax Act. The CIT (E) rejected this application because the assessee failed to submit the requisite details and factual evidences despite being given multiple opportunities.
Held
The Tribunal observed that the assessee had submitted a comprehensive 206-page Paper Book at the appellate stage, which could have been presented to the CIT (E). Taking a lenient view and in the interest of justice, the Tribunal set aside the CIT (E)'s order and restored the matter for fresh consideration, granting the assessee another opportunity to present its case before the CIT (E).
Key Issues
Whether the CIT (E) was justified in rejecting the assessee's application for registration under Section 12A(1)(ac)(iii) due to non-submission of details, and if the Tribunal should provide another opportunity.
Sections Cited
12A(1)(ac)(iii), 12AA(1)(ac)(iii), 12AB
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, DIVISION BENCH, ‘A’ CHANDIGARH
Before: SHRI RAJPAL YADAV & SHRI KRINWANT SAHAY
The assessee is in appeal before the Tribunal against the order of the ld. Commissioner of Income Tax (Exemptions) [in short ‘the CIT (E)’] dated 27.09.2024.
The grievance of the assessee is that ld. CIT (E) has erred in rejecting the application of the assessee for grant of registration u/s 12A(1)(ac)(iii) of the Income Tax Act.
ITA No.285/CHD/2025 A.Y.2022-23 2
With the assistance of ld. Representative, we have gone through the record carefully. It emerges out from the record that assessee has filed an application u/s 12AA(1)(ac)(iii) of the Act on 28.03.2024. Though ld. CIT (E) has issued a detailed Show Cause Notice and given number of opportunities to the assessee for submitting the requisite details, but assessee failed to submit the requisite details. Hence, the ld. CIT (E) has dismissed the application by recording brief findings in paragraph No. 5, which read as under : “5. In view of the above discussions, the present application of the applicant filed in Form 10AB u/s 12A(1)(ac)(iii) of the Act is disposed of as being deficient in factual evidences in the absence of the requisite submissions of the applicant at the scheduled hearings. Accordingly, the application filed by the applicant for registration u/s 12AB of the Act is hereby rejected and this rejection will also supersede any registration granted u/s 12AB of the Act by any authority at any earlier time.”
A perusal of the record would indicate that though assessee has filed a Paper Book wherein all the papers necessary for consideration have been placed on the record. The Paper Book is running into 206 pages. Had these papers would have been filed before the ld. CIT (E), probably she would have recorded a finding on the objectives of the assessee and whether it has been carrying out its activities, which would make it eligible to claim registration u/s 12AA(1)(ac)(iii)
A.Y.2022-23 3 of the Act. The ld. Tax Consultant of the assessee failed to prosecute the proceeding before ld. CIT (E) in an appropriate manner, however, taking a lenient view and in the interest of justice, we deem it appropriate that one more opportunity deserves to be given to the assessee for explaining its case before the ld. CIT (E). Accordingly, we set aside the impugned order and restore this issue to the file of ld. CIT (E).
In result, the appeal of the assessee is allowed for statistical purposes.
Order pronounced on 10.03.2026.