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Facts
The assessee, Pubbaja Bhumi Vipassana Trust, filed an application for approval under Section 80G of the Income Tax Act, 1961. The CIT(E) rejected the application, finding the assessee's submissions untenable, particularly regarding the valuation of land and building. The assessee argued that the valuation was reduced due to donations and requested an opportunity to provide better evidence.
Held
The Tribunal observed that the CIT(E) did not discuss the issue of land valuation in detail, making it difficult to appreciate the legality of the order. Considering the assessee's request for another opportunity to present their case with supporting material, the Tribunal decided to remand the matter.
Key Issues
Whether the CIT(E) erred in rejecting the application for approval under Section 80G without detailed discussion, and if the assessee should be granted another opportunity to present evidence.
Sections Cited
80G
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Income Tax Appellate Tribunal, JAIPUR BENCHES,”A” JAIPUR
आयकर अपीलीय अधिकरण] जयपुर न्यायपीठ] जयपुर IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES,”A” JAIPUR Jh jkBkSM+ deys'k t;UrHkkbZ] ys[kk lnL; ,o Jh ujsUnz dqekj] U;kf;d lnL; ds le{k BEFORE: SHRI RATHOD KAMLESH JAYANTBHAI, AM & SHRI NARINDER KUMAR, JM vk;dj vihy la-@ITA No. 785/JP/2024 cuke Pubbaja Bhumi Vipassana Trust, CIT Vs. Burmese Colony Near Sethi Exemption, Jaipur Colony, Jaipur LFkk;h ys[kk la-@thvkbZvkj la-@PAN/GIR No.: AABTP 6371 J vihykFkhZ@Appellant izR;FkhZ@Respondent fu/kZkfjrh dh vksj ls@ Assessee by : Sh. Vedant Agarwal, Adv. jktLo dh vksj ls@ Revenue by : Sh. Arvind Kumar, CIT-DR lquokbZ dh rkjh[k@ Date of Hearing : 02/12/2024 mn?kks"k.kk dh rkjh[k@Date of Pronouncement: 09/12/2024 vkns'k@ ORDER PER: RATHOD KAMLESH JAYANTBHAI, AM
Present appeal has been preferred, as the assessee feels aggrieved by order dated 29.03.2024 passed by the Commissioner of Income Tax Exemption, Jaipur [ hereinafter referred to as ld. CIT(E) ].
In this appeal, the assessee has taken following grounds ;
1. On the facts and circumstances of the case and in law also Ld. CIT (Exemption), Jaipur grossly erred in rejecting the application for approval u/s 80G of the Income Tax Act, 1961.
2. On the facts and circumstances of the case Ld. CIT (Exemption) Jaipur grossly erred in not considering the fact that the activities of trust are genuine and the trust has fulfilled all the necessary conditions for approval as stipulated in the law.
3 On the facts and circumstances of the case and in law also Ld. CIT (Exemption) grossly erred in not considering the replies filed by the trust in right perspective.
4 That the appellant craves his indulgence to add, amend, alter or delete the grounds of appeal.”
Brief facts, as emerge from the record, are that on 28.09.2023, the appellant-applicant filed an application in Form No. 10AB seeking approval under clause (iii) of first proviso to sub-section (5) of section 80G of the Income Tax Act, 1961.
The applicant was issued a letter/notice dated 26.12.2023 to furnish certain documents/ details to justify its claim by 10.01.2024. However, the applicant requested adjournment, and the matter was adjourned to 01.02.2024, vide notice dated 19.01.2024. But, no compliance was made by the applicant.
A show cause notice dated 21.02.2024 came to be issued to the applicant to furnish explanation by 27.02.2024. In reply thereo, the applicant put forth his submission. tenable. Again, the applicant-assessee was asked to submit the submission on or before 08.03.2024.
However, the submission made by applicant was not found satisfactory and accordingly, Ld. CIT(E) was of the view that the assessee-applicant was not eligible for exemption u/s 80G, and as a result, the application was rejected, while observing in the manner as:
“The submission made by the applicant is not justifiable because the value of land could not be less. Neither the land was sold nor depreciated. Therefore, the account submitted by the applicant is not reliable and the application filed by the applicant is rejected.”
Ld. AR of the assessee has submitted that the observations made in the impugned order that the value of land and building shown in the balance-sheet was on the lesser side is correct, the reason being that the Accountant had reduced the amount of donations from the land and building including construction value and as a consequence, the value of land and building was shown to have decreased year by year.
Learned AR has further submitted that the assessee could not satisfy Ld. CIT(A) on the query raised, but in case another opportunity is granted to the applicant, it would be able to explain the things by providing better Ld. CIT(E).
It may be mentioned that Learned CIT(A) observed in the impugned order that even otherwise, the applicant had requested by way of an application submitted on 28.3.2024 to withdraw the aforementioned application u/s 80G of the Act.
Learned AR for the appellant states at the Bar that this observation recorded in the impugned order is not correct, as no such request or application was moved on behalf of the applicant on 28.3.2024.
Per contra, the ld. DR relied upon the finding recorded in the order of ld. CIT(E) and submitted that the failure of the part of the assessee is evident and apparent as the assessee did not produce on record the details of value reduced from the amount of land and building. Alternatively he has not objected to prayer of the appellant for remand of the matter to files of ld. CIT(E) so as to provide another opportunity to the applicant to establish its case by leading cogent evidence.
We have considered rival contentions and perused the material placed on record.
28.3.2024 any request was made on behalf of the applicant for withdrawal of the application.
Even otherwise, it remains unexplained as to why Ld. CIT(E) proceeded to dispose of the application even after a prayer was made for withdrawal of the application.
As regards the observations recorded in the impugned order in not believing the claim of the applicant relating to the value of the land and the observation that neither the land was sold nor depreciated, we are of the view that Learned CIT(E) has not discussed the issue in detail. In absence of discussion on the issue in detail, it is difficult to appreciate the legality or illegality of the impugned order.
Since Learned AR for the appellant has made submission before us for remand of the matter that the applicant is granted another opportunity to explain its version put forth on 7.3.2024, in reply to the show cause notice dated 26.12.2023, by placing on record best material available with the appellant, we deem it fit to remand the matter back to the file of ld. CIT(E). while setting aside the impugned order, remand the matter to the files of Learned CIT(E), who shall decide the application afresh after providing sufficient opportunity of being heard to the assessee.
Order pronounced in the open court on 09/12/2024.
Sd/- Sd/- ¼ujsUnz dqekj½ ¼jkBkSM+ deys'k t;UrHkkbZ½ (NARINDER KUMAR) (RATHOD KAMLESH JAYANTBHAI) U;kf;d lnL;@Judicial Member ys[kk lnL; @Accountant Member Tk;iqj@Jaipur fnukad@Dated:- 09/12/2024 *Ganesh Kumar, Sr. PS आदेश की प्रतिलिपि अग्रेf’ात@ब्वचल वf जीम वतकमत वितूंतकमक जवरू 1. The Appellant- Pubbaja Trust Vipassana Trust, Jaipur izR;FkhZ@ The Respondent- CIT Exemption, Jaipur 2. vk;dj vk;qDr@ The ld CIT 3. 4. vk;dj vk;qDr¼vihy½@The ld CIT(A) 5. विभागीय प्रतिनिधि] आयकर अपीलीय अधिकरण] जयपुर@क्त्ए प्ज्Aज्ए Jंपचनत 6. xkMZ QkbZy@ Guard File (ITA No. 785/JP/2024) vkns'kkuqlkj@ By order,
सहायक पंजीकार@Aेेज. त्महपेजतंत