SHREE JAIN SWETAMBAR PRACHIN TIRTH,JODHPUR vs. CIT(EXEMPTION),, JAIPUR

At the outset, the learned Counsel for the assessee strongly contended that the impugned order rejecting assessee's application for registration u/s 12AA of the IT Act was passed by learned CIT(E) without giving adequate opportunity to the assessee and also without due consideration of written submissions filed by the assessee. In view of the foregoing, the learned CIT (D.R.) submitted that the issue regarding registration u/s 12AA of the IT Act may be set aside to the file of learned CIT(E) for fresh order in accordance with law after providing reasonable opportunity to the assessee and after due consideration of the assessee's submissions.

In the present case, the CIT Exemption has merely mentioned that applicant has failed to comply with the letters, despite being given three opportunities and in the absence of such details, it could not be determined whether the applicant is genuinely carrying out charitable activity as per its objects while rejecting the applicant's claim of registration u/s 12A of the Act is as liable to be rejected.

Accordingly, we hold that the Ld. CIT Exemption has acted in hurry and irrational manner while rejecting the appellants application for registration u/s 12AA/12AB of the act, without appreciating merits regarding genuineness of activities of the Trust at this stage because the assessee Trust is engaged in running a Dharamshala for accommodating the pilgrimise to Jain Temple in its activities as claimed.

Considering the peculiar facts of the instant case, we are of the considered view that the assessee has good and arguable case for granting registration u/s 12AB of the Income Tax Act, 1961 provided adequate opportunity to establish genuineness of its activities. In view of principles of natural justice, we consider it deem fit to remand back the matter regarding grant of registration under section 12 AB of the Income Tax Act to the file of the Ld. CIT exemption for afresh adjudication after granting adequate opportunity of being heard and considering the written submissions filed on the record and to be filed during fresh proceedings. Appellant and its council are also directed to cooperate in the fresh proceedings by filing the requisite details in compliance to the queries raised by the learned CIT exemption for the purpose of adjudication of the matter of grant of registration act section 12AB of the Act, in accordance with law.