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Facts
The assessee, Paradise Sarv Kalyan Sansthan, filed applications for registration under Section 12A and approval under Section 80G. Both applications were rejected by the CIT(E) due to non-compliance with notices and the assertion that the applications had become infructuous. The assessee contended that a reasonable opportunity to present details was not provided.
Held
The Tribunal observed that the CIT(E) had provided only one notice to the assessee, and the text of the impugned orders did not clearly mention the issuance of a second notice or the opportunity for a hearing on 04.01.2024. It was held that the principles of natural justice were not complied with, as a reasonable opportunity of being heard was not granted to the assessee.
Key Issues
Whether the denial of reasonable opportunity to the assessee for furnishing details led to the rejection of their applications for registration under Section 12A and approval under Section 80G.
Sections Cited
Section 12A, Section 80G
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Income Tax Appellate Tribunal, JAIPUR BENCHES,”B” JAIPUR
Before: SHRI RATHOD KAMLESH JAYANTBHAI, AM& SHRI NARINDER KUMAR, JM
vkns'k@ORDER PER: NARINDER KUMAR, Judicial Member.
These two appeals have been filed by the assessee, named above. These arise out of separate orders dated 03.02.2024 passed by Learned Commissioner of Income Tax (Exemption), Jaipur [hereinafter referred to as CIT(E) ]. Vide an order, application filed by the trust, in Form No. 10AB seeking registration under sub-clause (ii) of sub-section (1) of Section 12A & 402/JPR/2024 Paradise Sarv Kalyan Sansthan of the Income Tax Act, 1961 (hereinafter referred to as “the Act”) came to be rejected. Vide separate order, another application in Form No. 10AB, seeking approval under clause (ii) of first proviso to sub-section (5) of section 80G of the Act, also came to be rejected. Since common questions are involved, both the appeals have been taken up together and are being disposed vide common judgment.
Appellant-applicant claims itself to be a charitable trust working for public welfare activities like promotion and advancement of general public welfare, relief to the poor; and medical reliefs to the needy. ITA No. 401/JPR/2024 3. Appellant is feeling aggrieved by order dated 03.02.2024 whereby its application presented on 23.09.2023 in Form No. 10AB seeking registration under sub-clause (ii) of sub-section (1) of Section 12A of the Income Tax Act, 1961 (hereinafter referred to as “the Act”), has been rejected having become infructuous.
The impugned order came to be passed by Learned CIT(E), while observing that the applicant was already not regularly registered under clause (i) or (iii) of section 12AB of the Act. ITA No. 402/JPR/2024 ITA No. 401 & 402/JPR/2024 Paradise Sarv Kalyan Sansthan 5. By way of this appeal, the appellant-trust has challenged order dated 03.02.2024 passed by the Learned CIT(E), whereby its application filed on 23.09.2023 in Form No. 10AB seeking approval under clause (ii) of first proviso to sub-section (5) of section 80G of the Act, has been rejected, while observing that the same had also become infructuous.
The reasons for rejecting the application, as per impugned order, is that the assessee failed to furnish details/information required vide notice dated 21.12.2023 and also because the applicant had already not got registered under clause (i) or (iii) of first proviso to section 80G(5) of the Act.
Hence, this appeal.
Arguments heard. Files perused.
In both appeals, the only submission put forth on behalf of the appellant trust is that no reasonable opportunity was granted by Learned CIT(E) to the applicant to furnish requisite details/information. The ld. AR for the assessee has, therefore, urged that the impugned orders be set aside and the matters may be remanded to the Learned CIT(E) for decision afresh, after providing reasonable opportunity to the appellant of being heard.
ITA No. 401 & 402/JPR/2024 Paradise Sarv Kalyan Sansthan 10. As is available from the impugned orders passed by Learned CIT(E), in particular, from the tables available in the very beginning of the orders, which are in Form No. 10AD, two opportunities were afforded to the applicant before rejection of the each application. As per contents of column 10 of this table, one opportunity was afforded vide notice dated 21.12.2023 issued for 29.12.2023. The other opportunity was granted for 04.01.2024. However, in para 2 of each impugned order, there is mention about issuance of only one notice dated 21.12.2023, to the applicant and that too for 29.12.2023. In said paragraph of each impugned order, there is no mention regarding issuance of any other notice. Had any second notice been issued on or for 04.01.2024, the date mentioned in column no. 10 of the above referred to table(s), it must have found mention in the text of the orders. But, as already mentioned, in para 2 of the impugned orders, there is no mention about issuance of any second notice.
In the given situation, we find that reasonable opportunity of being heard was not granted to the applicant-appellant to justify its claim as put forth in the respective application i.e. u/s 12A of the Act and sub-section (5) of Section 80G of the Act. Had reasonable opportunity been afforded, the & 402/JPR/2024 Paradise Sarv Kalyan Sansthan applicant might have complied with notices. On behalf of the appellant, it has been submitted that the President of the applicant trust was not keeping good health, and as such, notice dated 21.12.2023 could not be complied with. Although no medical certificate has been filed in support of this submission, in view of our observation that reasonable opportunity should have been granted to the applicant, before disposing of the applications, non production of medical certificate does not come to the aid of department. We are of the considered view that this is a matter where the basic principles of natural justice have not been complied with. Conclusion 12. For the foregoing discussion, we find that both the impugned orders i.e. one challenged by way of ITA No. 401/JPR/2024 and the other by way of ITA No. 402/JPR/2024 deserve to be set aside, and matter(s) need remanded to Learned CIT(E) for decision afresh, after providing reasonable opportunity to the applicant-appellant, of being heard. Result 13. Consequently, both these appeals are allowed. While setting aside the impugned orders, the matters are remanded to Learned CIT(E), Jaipur ITA No. 401 & 402/JPR/2024 Paradise Sarv Kalyan Sansthan for decision of the respective application afresh, after providing reasonable opportunity to the appellant-applicant, of being heard.
Order pronounced in the open court on 10/07/2024.