Loading judgment…
Facts
The assessee, a charitable trust managing educational institutions, filed an application for approval under section 80G of the IT Act. The CIT(E) rejected the application for non-compliance with a notice seeking documents, citing a limitation date of 30.09.2022.
Held
The Tribunal observed that the assessee was denied a reasonable opportunity to present its case due to the short span between the notice and the order. Therefore, the Tribunal directed the CIT(E) to accept a fresh application and consider it on merits.
Key Issues
Whether the CIT(E) erred in rejecting the application for 80G approval without providing adequate opportunity and whether principles of natural justice were violated.
Sections Cited
80G, Rule11AA(2)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “E” BENCH, MUMBAI
O R D E R Per Kavitha Rajagopal, J M: This appeal has been filed by the assessee, challenging the order of the learned Commissioner of Income Tax (Exemptions), Mumbai (‘ld.CIT(E) for short), pertaining to the Assessment Year (‘A.Y.’ for short) 2022-23.
2. As there was no representation on behalf of the assessee, we hereby dispose of this appeal by hearing the learned Departmental Representative ('ld.DR' for short) and on perusal of the materials available on record. It is observed that the appeal has been filed with a delay of 398 days for which the assessee has filed an Affidavit for condoning the said delay, stating that it had sufficient cause for the said delay. On perusal of the Affidavit, we deem it fit to condone the delay in filing this present appeal. Delay condoned.
3. The grounds of appeal raised by the assessee reads as under:
(A.Y. 2022-23) Haji Jamaluddin Thim Trust vs. CIT(Exemption) 1. Under the facts and circumstances the learned Commissioner of Income Tax (Exemptions) erred in rejecting the application for grant of approval under section 80G of I.T. Act stating in the absence of necessary compliance by the Appellant as such I am left with no other option but to reject the application seeking approval under section 80G of the Act as the limitation to decide on the application is 30.09.2022.
The appellants were issued notices dated 12.09.2022 and 19.09.2022 and other is passed as 25.09.2022. (a) The learned Commissioner of Income Tax (Exemption) failed to appreciate that the object of notice to give an opportunity to the individual concerned to present his case. Moreover, the notice must give a reasonable opportunity to comply with the requirements mentioned therein. Natural justice therefore require that the person directly affected by the proposed acts, decisions or processing are given adequate notice.
The learned Commissioner of Income Tax (Exemption) failed to specify the documents/details not accompanied with the application filed in Form 10AB.
The brief facts are that the assessee is a Charitable Trust which is into the management of Thim College of Engineering and Thim Global School and Junior College of Arts, Commerce and Science at Boisar, Tal. & Dist. Palghar (Maharashtra), which is approved by the Government of Maharashtra and affiliated to University of Mumbai. The assessee Trust is registered with the Charitable Trust, Mumbai and registered under 12A and u/s.80G of the Act with Commissioner of Income Tax (Mumbai). It is observed that the assessee has filed an application for registration u/s. 80G of the Act in Form 10AB dated 11.04.2024 before the Commissioner of Income Tax (Exemption) who vide order dated 25.09.2022, rejected the application for grant of approval u/s. 80G for the reason that the assessee has not complied with the notice dated 19.09.2022 issued by the ld. CIT(E), for furnishing the relevant documents as prescribed under Rule11AA(2) of the I.T. Rules.
Aggrieved the assessee is in appeal before us challenging the order of the ld. CIT(E).
We have heard the ld. DR and perused the materials available on record. It is observed that the assessee had filed an application in Form 10AB for obtaining approval
(A.Y. 2022-23) Haji Jamaluddin Thim Trust vs. CIT(Exemption) u/s. 80G of the Act subsequent to the provisional approval granted to the assessee by the CPC/A.O. as per the provisions of section 80G of the Act. The ld. CIT(E) has rejected the said application on the ground that the assessee had failed to furnish documents which are required for approval of institution of fund under clause (vi) of sub section (5) of section 80G of the Act. The assessee in its grounds of appeal has contended that the ld. CIT(E) had issued notice on 12.09.2022 and 19.09.2022, seeking for the documents required for approval and have passed the impugned order on 25.09.2022, within a very short span of time. The assessee alleges that it was denied reasonable opportunity as contemplated by the principles of natural justice.
The Revenue had controverted this by stating that the ld. CIT(E) had to decide on the said application before 30.09.2022 else the same would be barred by limitation.
From the above factual matrix, we are of the considered opinion that the assessee being a Trust engaged in running educational institutions should be given another opportunity for applying for approval u/s. 80G of the Act in Form 10AB. Hence, we direct the ld. CIT(E) to accept fresh form 10AB proposed to be filed by the assessee and to consider the same on the merits and in accordance with law by giving sufficient time and opportunity to the assessee. We, therefore, allow the grounds of appeal raised by the assessee.