KSHATRIYA RAJPUR DOCTORS ORGANIZATION,DELHI vs. CIT EXEMPTION, DELHI

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ITA 2755/DEL/2024Status: DisposedITAT Delhi03 December 2024Bench: SHRI MAHAVIR SINGH (Vice President), SHRI NAVEEN CHANDRA (Accountant Member)3 pages

AI SummaryRemanded

Facts

The assessee's applications for registration under Section 12A(1)(ac)(iii) and approval under Section 80G(5)(iii) were rejected by the CIT(Exemption). The rejection was based on the assessee's failure to submit requisite details and documents, and inability to demonstrate charitable activity benefiting the general public as per Section 2(15) of the Income-tax Act, 1961. The CIT(Exemption) also noted that Form 10AB for the relevant financial year was not furnished, and details regarding expenses and accumulation were unexplained.

Held

The Tribunal held that the principle of natural justice requires providing the assessee a reasonable opportunity to submit the necessary details. Consequently, the CIT(Exemption)'s orders were set aside, and the matter was remanded back for fresh adjudication, allowing the assessee to substantiate its claim as a genuine charitable company.

Key Issues

Whether the CIT(Exemption) was justified in rejecting the applications for charitable registration and 80G approval without affording the assessee a full opportunity to submit required details and prove its charitable activities.

Sections Cited

Section 12A(1)(ac)(iii), Section 80G(5) clause (iii), Section 2(15), Section 25

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, IN THE INCOME TAX APPELLATE TRIBUNAL

Before: SHRI MAHAVIR SINGH SHRI MAHAVIR SINGH, , , , VICE SHRI MAHAVIR SINGH & SHRI NAVEEN CHANDRA, ACCOUNTANT SHRI NAVEEN CHANDRA SHRI NAVEEN CHANDRA

For Appellant: Shri Dushyant Maharishi, CA

For Respondent: Shri Dayainder Singh Sidhu, CIT-DR

Pronounced: 03.12

The only common issue in these two appeals of the assessee is as regards the order of learned CIT(Exemption) is against rejection of application under Section 12A(1)(ac)(iii) of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’) filed in Form No.10AB on 26th September, 2023 and under Section 80G(5) clause (iii) of first proviso in Form No.10AB dated 26th September, 2023. For these two appeals, assessee has raised various grounds, in each of appeal, which are argumentative, factual and need not be reproduced.

We have heard rival contentions and gone through the facts and circumstances of the case. We noted that the assessee filed an application electronically on 26th September, 2023 in Form No.10AB seeking registration under Section 12A(1)(ac)(iii) of the Act with the learned CIT(Exemption) submitted various letters for submission of details like financial statements, bank statements, form 10AB, address of the trustees, etc. as assessee is a company registered under Section 25 being charitable company. The assessee has not furnished form 10AB for the relevant financial year and details remain unexplained with regard to the nature of expenses and accumulation etc. Learned CIT(Exemption) has noted from the perusal of the details that the assessee has not carried out any charitable activity benefiting general public as envisaged under the provisions of Section 2(15) of the Act. The assessee has not submitted any bills/vouchers in support of its claim and from the pictures and documents submitted by the assessee, he concluded that the dominant objects and activities of the company are not for general public. Finally, learned CIT(Exemption) held that the assessee failed to submit requisite details and documents in support of its claim of carrying out charitable activity as mandated under Section 2(15) of the Act and therefore, the conditions for grant of registration are not satisfied. Hence, he rejected form 10AB and provisional registration was also cancelled.