THE NAGAR VACHANALAYA VITA,SANGLI vs. COMMISSIONER OF INCOME TAX, EXEMPTION, PUNE, PUNE

The appeal filed by the assessee is directed against the order dated 24.07.2024 of the Ld. Commissioner of Income Tax (Exemption), Pune [“CIT(E)”] whereby he rejected the application of the assessee filed before him in Form No. 10AB on 13.01.2024 under section 12A(1)(ac)(iii) of the Income Tax Act, 1961 (The “Act”).

The assessee has raised the following grounds of appeal:-

The appellant craves leave to add, alter, modify or substitute any ground of appeal at the time of hearing.”

In view of the facts narrated above, the Ld. CIT(E) proceeded to pass the impugned order rejecting the application filed by the assessee and also cancelling the provisional registration granted on 27.05.2021 to the assessee, observing as under:- “7. Considering the above facts discussed in the show notice and discrepancies noticed and also that the assessee has not complied with the provisions of section 12AB(1)(b)(i) of the Income Tax Act, 1961 as well as the provisions of Rule 17A(2) of Income Tax Rules, 1962 in spite giving sufficient opportunities, the undersigned is unable to draw any satisfactory conclusion about the genuineness of activities of the assessee and compliance of requirements of any other law for the time being in force by the assessee as are material for the purpose of achieving its objects.”

Dissatisfied, the assessee is in appeal before the Tribunal.

The Ld. AR submitted that there was no intentional non- compliance before the Ld. CIT(E). The assessee submitted its response to the 2nd show cause notice based on which the Ld. CIT(E) noted certain discrepancies which were communicated to the assessee followed by issuance of another show cause notice on 11.07.2024. However, the assessee could not file its response by the due date of 18.07.2024 and the Ld. CIT(E) proceeded to pass the impugned order on 24.07.2024 in the absence of the same. She, therefore, pleaded that an opportunity may be granted to the assessee to present its case before the Ld. CIT(E). The Ld. AR also submitted that given an opportunity the assessee is in a position to submit all the requisite details/documentary evidence in support of its application including the details on the discrepancies cited by the Ld. CIT(E). The Ld. DR therefore, requested that the matter may be set aside to the file of the Ld. CIT(E) to consider the assessee’s application afresh. The Ld. DR, on the other hand supported the order of the 7. Ld. CIT(E) and submitted that the assessee was granted adequate opportunity by the Ld. CIT(E) to present its case, still the assessee failed to comply to prove the genuineness of the activities of trust to the satisfaction of the Ld. CIT(E) by filing the supporting evidence thereof. The Ld. CIT(E) was, therefore, fully justified in rejecting the assessee’s application for regular registration and cancelling the provisional registration.

We have considered the rival submission and perused the records. On the facts and in the circumstances of the assessee’s case, we are of the view that it would be judicially prudent and in the interest of justice and fair play if the matter is restored back to the file of Ld. CIT(E) to consider afresh the assessee’s application for registration under section 12A(1)(ac)(iii) of the Act in accordance with facts and law after allowing one more opportunity of being heard to the assessee and present its case. The assessee shall provide requisite support in terms of submitting the relevant details/documentary evidence as may be required/called upon on the appointed date failing which the Ld. CIT(E) shall be at liberty to pass appropriate order as per facts and law. We order accordingly.

In the result, the appeal of the assessee is treated as allowed for statistical purposes.