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Facts
The assessee, a charitable trust engaged in educational activities, filed an application for recognition under Section 80G(5) of the Income-tax Act, 1961. The CIT(E) rejected the application because the assessee failed to submit required details due to unforeseen circumstances and missed hearing dates. The assessee appealed this rejection.
Held
The Tribunal acknowledged that the assessee could not submit the details due to circumstances beyond their control, despite holding 80G recognition since 2008. Granting one more opportunity would not prejudice any party.
Key Issues
Whether the rejection of the application for recognition under Section 80G(5) by the CIT(E) was justified, given the circumstances preventing the assessee from submitting details.
Sections Cited
80G(5), 12AA
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Income Tax Appellate Tribunal, “A” BENCH : BANGALORE
Before: SHRI PRASHANT MAHARISHI & SHRI PRAKASH CHAND YADAV
Per Prashant Maharishi, Vice President
This appeal is filed by Kodava Samaj R Mysore (the assessee/appellant) against the appellate order passed by the ld. Commissioner of Income-tax (Exemptions) [ld. CIT(E)] dated 21.09.2024 in Form 10AD wherein application filed by the assessee for recognition u/s. 80G(5) of the Income-tax Act, 1961 (the Act) was rejected. Assessee is aggrieved with that and has preferred this appeal raising only the substantial ground mentioned at ground No.2 of the appeal which is rejection of application of recognition under that section.
As per the facts stated, assessee is a charitable trust registered under the Karnataka Societies Registration Act, 1960 since 12.04.1979 which is engaged in educational activities and was granted registration u/s. 12AA of the Act by the CIT, Mysore on 13.6.2008 which was re-registered under the new provisions on 24.9.2021. The trust was also having recognition u/s. 80G of the Act since 5.6.2009. Under the new regime, once again provisional recognition u/s. 80G(5) was granted on 10.3.2022. Assessee submitted Form 10AB for final approval u/s. 80G(5) on 21.3.2024.
On examination of this application, ld. CIT(E) issued notices on 22.7.2024 wherein assessee was asked to appear on 05.8.2024. However there was unfortunate demise of relative of authorized representative on that date. Therefore further notice was issued on 14.8.2024 fixing date of hearing on 27/08/2024 which was received by assessee only on 27.8.2024, therefore assessee could not appear on that date and order was passed on 21.9.2024 wherein the last hearing was recorded of 14.8.2024 at sl.no.10. As the assessee could not submit the detail to the notices issued, ld. CIT(E) rejected the application of assessee in Form 10AB and provisional approval granted earlier was cancelled.
The ld. AR submitted a written note dated 27.11.2024 wherein the above facts are reiterated and only request is that assessee may be granted opportunity of submitting the details once again.
The ld. DR supported the order of the ld. CIT(E) stating that when the assessee did not appear, there is no option left with the ld. CIT(E), except rejecting the same.
We have carefully considered the rival contentions and perused the orders of the ld. CIT(E) rejecting the provisional approval granted to the assessee u/s. 80G(5) of the Act, the solitary reason being that assessee has not responded, but failed to submit necessary documents called for. We find that assessee was granted first opportunity by notice dated 22.7.2024 fixing the date of hearing on 05.8.2024, but due to death of relative of counsel, no compliance was made. Further notice dated 14.8.2024 was issued fixing the date of hearing on 27.8.2024, which was received by assessee only on 27.8.2024, therefore there was no compliance on the side of assessee and subsequently on 21.9.2024, the ld. CIT(E) passed the order rejecting the approval. The only reason for rejecting the approval is non-submission of details by assessee.
In view of the above peculiar situation, it is apparent that assessee could not submit the requisite details, though holding the 80G recognition since 2008. Therefore undisputedly as assessee-trust is carrying on charitable activities and also having recognition u/s. 80G(5) as well as granted provisional recognition also, if one more opportunity is granted to submit the details, no prejudice would be caused to either parties. In view of this, we direct the assessee to comply with the notices and submit all the details called for by the ld. CIT(E) within 90 days from the date of receipt of this order. The ld. CIT(E) may examine the same and if found
in order, grant recognition to the assessee. Needless to say that requisite opportunity of hearing be granted to the assessee. The solitary ground of appeal as per ground No.2 is allowed for statistical purposes.
In the result, the appeal of the assessee is allowed for statistical purposes.
Pronounced in the open court on this 28th day of November, 2024.