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Facts
The assessee sought registration under section 12AB of the Act, but made no compliance to the show cause notices. The Assessing Officer rejected the application on 19.03.2023, citing statutory limitation period.
Held
The Tribunal noted that the Commissioner rejected the application without providing an opportunity to the assessee to substantiate its case or expressing an opinion on the rejection. Therefore, the case is remanded to the Commissioner for a fresh decision on merits.
Key Issues
Whether the Ld. Commissioner erred in rejecting the registration application without providing an opportunity to the assessee to be heard and without considering the merits of the application.
Sections Cited
12AB, 2C, 11AA, 17A
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Income Tax Appellate Tribunal, MUMBAI BENCH “A”, MUMBAI
Before: SHRI NARENDER KUMAR CHOUDHRY & SHRI OMKARESHWAR CHIDARA
Per : Narender Kumar Choudhry, Judicial Member:
This appeal has been preferred by the assessee against the order dated 19.03.2023, impugned herein, passed by the Ld. Commissioner of Income Tax (Exemptions) (in short Ld. Commissioner) under Rule 2C or 11AA or 17A of the Income Tax Rules, 1962 (in short ‘the Rules’) for the A.Y. 2024-25.
In the instant case, the Assessee before the Ld. Commissioner has sought registration under section 12AB of the Act, by filing an application, which was taken into consideration on 18.01.2023 whereby the assessee was requested to furnish the complete set of documents. In response to which, the Assessee filed its submissions dated 31.01.2023. Thereafter, another show cause notice dated 10.03.2023 was issued to the Assessee in order to ascertain the genuineness of the activities carried out by the assessee, however, the assessee made no compliance, therefore the Assessing Officer (AO) by considering the statutory limitation period to decide the application on or before 31.03.2023, ultimately rejected the application on 19.03.2023 by holding that he has left with no other option but to reject the application seeking registration under section 12AB of the Act.
We have given thoughtful considerations to the peculiar facts and circumstances of the case and observed that the Ld. Commissioner on non-filing of any reply/documents to the satisfaction of the Ld. Commissioner and considering the limitation period as prescribed for deciding the application under section 12AB of the Act, rejected the application for grant of registration under section 12AB of the Act in limine. It is nowhere appears from the impugned order that before rejecting the application for registration the Ld. Commissioner has ever expressed his opinion qua rejection of the registration application and/or given any opportunity to the Assessee to substantiate its application. Considering the peculiar facts and circumstances in its totality and for the just decision of the case and for the ends of substantial justice, we are inclined to remand this case to the file of the Ld. Commissioner for decision afresh on merits, suffice to say by affording reasonable opportunity to the Assessee to substantiate its case. Hence, the case is remanded accordingly.
In the result, the appeal filed by the assessee stands allowed for statistical purposes.
Order pronounced in the open court on 28.06.2024.