HASAMSETH PABLIK LAYBRARI AND CHERITEBAL TRUST,AKOLA vs. CIT, EXEMPTION, PUNE
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Income Tax Appellate Tribunal, NAGPUR BENCH, NAGPUR
Before: HON’BLE SHRI S. S. GODARA & SHRI G. D. PADMAHSHALI
IN THE INCOME TAX APPELLATE TRIBUNAL, NAGPUR BENCH, NAGPUR
(Through Virtual hearing from ITAT, Pune) BEFORE HON’BLE SHRI S. S. GODARA, JUDICIAL MEMBER AND SHRI G. D. PADMAHSHALI, ACCOUNTANT MEMBER आयकर अपीलसं. / ITA No. 226 & 229/NAG/2023 Hasamseth Pablik Laybrari And Cheritebal Trust Tasjna Peth, Subhash Chowk, Akola-444001 PAN:AABTH4733N . . . . . . . अपीलार्थी / Appellant
बनाम / V/s. Commissioner of Income Tax Exemption, Pune. . . . . . . .प्रत्यर्थी / Respondent द्वारा / Appearances Assessee by : Mr Mahavir Atal [‘Ld. AR’] Revenue by : Mr K C Kanojiya [‘Ld. DR’] सुनवाई की तारीख / Date of conclusive Hearing : 20/03/2024 घोषणा की तारीख / Date of Pronouncement : 20/03/2024 आदेश / ORDER PER G. D. PADMAHSHALI, AM; The present twin appeals of the assessee are assailed against separate orders of Ld. Commissioner of Income Tax (Exemption), Pune [‘CIT(E)’] both dt. 30/03/2023 passed u/s 12AB(4) & 80G(5) of the Income-tax Act, 1961 [‘the Act’] respectively.
Since the facts and solitary issue involved in these twin appeals are interrelated & interconnected, on the request of rival parties, for the sake of brevity these are heard together for a common and consolidated order.
At the outset, after vouching sufficiency of reasons beyond undeliberate 46 & 50 days delay in instituting these twin appeals, we after placing reliance on ITAT-Nagpur Page 1 of 4
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‘Vijay Vishin Meghani Vs. DCIT & Anr’ reported 398 ITR 250 (Bom) and ‘Collector, Land Acquisition, Anantnag and Anr. Vs Ms Katiji and Others’ [167 ITR 5 (SC)], deem it fit to condone the delay requoting that ‘none should be deprived of adjudication on merits unless found that the filing of appeal is deliberately delayed.’
Briefly stated facts borne out of these case records are; 4.1 The assessee is registered as ‘Hasham Seth Public Library And Charitable Trust’ under the provisions of Bombay Public Trust Act, 1950 [Pg01-02/PB] which obtained a provisional registration u/s 12AB r.w.s. 12A(1)(ac)(vi) & 80G(5)(vi) of the Act in the name ‘Hasamseth Pablik Laybrari And Cheritebal Trust’, pursuant to which it applied for regular registration in Form No 10AB on 29/09/2022 u/s 12A(1)(ac)(iii) under the category of charitable trust/institution and also applied for regular registration u/clause (ii) of first proviso to section 80G(5) of the Act.
4.2 The failure on the part of assessee to comply with the notices requiring production of requisite documents as envisaged 17A(2) of IT-Rules, 1962 so as to enable the registering authority to ascertain overall nature and genuineness of activities the appellant engaged into and also to ascertain the compliance of such applicable requirements of any other law for the time being force which are material for the purpose of achieving appellant’s objectives etc., the Ld. CIT(E) rejected its application of regular 12A registration and in the absence thereof application for regular 80G(5) registration was also rejected in limine and in consequence provisional registrations by the impugned order also withdrawn. ITAT-Nagpur Page 2 of 4
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4.3 Aggrieved by the aforestated rejections and cancellation of provisional registrations, the assessee set-up these twin appeals against respective impugned orders with a prayer to grant one more opportunity to comply.
We have heard both rival parties; and subject to the provisions of rule 18 of ITAT Rules 1963, perused material placed on record which suggests that, the preliminary submission of the appellant did fail to substantiate its activities so as to draw a reasonable conclusion about the genuineness of the activities and compliance with the applicable laws etc. As a consequence, the Ld. CIT(E) after observing principle of natural justice as commanded by sub-clause (B) of section 12AB(1)(b)(ii) and by clause (ii)(b)(B) of 2nd proviso to 80G(5) of the Act r.w. proviso to rule 11AA(5) of the Income Tax Rules, 1962, rejected these applications which prima-facie in our considered view remained flawless.
We note that, when first notice dt. 13/01/2023 served requiring documents remained unattained, a show cause notice dt. 02/02/2023 was issued and in the event of non-compliance therewith without further opportunity to the appellant the Ld. CIT(E) rejected 12AB application and in the absence of regular 12AB certificate also denied regular 80G registration. This action of the Ld. CIT(E) in our view suffered from reasonable opportunity thus principle of natural justice.
It is to be noted that, in the matter of registration, a reasonable and effective opportunity to the appellant is not only necessary but a must thing to protect against arbitrary rejection. This would also ensure that negative observations (if any) are negated by credible evidences by the appellant. Any proceedings ITAT-Nagpur Page 3 of 4
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culminated without effective notice and reasonable opportunity would be violative of principle of natural justice, which de-facto turns the proceedings bad in law and therefore deserving to be set-aside in view of the ratio laid down by Hon’ble Rajasthan High Court in ‘Sanatan Dharm Mahaveer Dal Vs CIT’ reported in 252 ITR 46.
For the aforestated reasons, without commenting on merits of the case we deem it fit to set-aside the impugned orders and remand the matter back to the file of Ld. CIT(E) for de-nova adjudication in accordance with law subject to our observation noted at para 4.1 hereinbefore. Needless to state that the assessee shall be provided with not more than two effective opportunities to explain the former discrepancies and further to comply with the requirements as may be directed by the registering authority in this regard.
In result, both these appeals are ALLOWED FOR STATISTICAL PURPOSE. In terms of rule 34 of ITAT Rules, the order pronounced in the open court on this Wednesday, 20th day of March, 2024.
-S/d- -S/d- S. S. GODARA G. D. PADMAHSHALI JUDICIAL MEMBER ACCOUNTANT MEMBER पुणे / PUNE ; ददनाांक / Dated : 20th day of March, 2024. आदेश की प्रतितलतप अग्रेतिि / Copy of the Order forwarded to : 1.अपीलाथी / The Appellant. 2. प्रत्यथी / The Respondent. 3. The Pr. CIT, Pune 4. The Pr. CIT(E), Pune 5. DR, ITAT, Nagpur Bench, 6. गार्डफ़ाइल / Guard File. आदेशानुसार / By Order, वररष्ठ दनजी सदिव / Sr. Private Secretary आयकरअपीलीय न्यायादधकरण, पुणे / ITAT, Pune.
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