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Income Tax Appellate Tribunal, JAIPUR BENCHES,”B” JAIPUR
Before: SHRI SANDEEP GOSAIN, JM & SHRI RATHOD KAMLESH JAYANTBHAI, AM vk;djvihy la-@ITA Nos. 276 & 275/JP/2023
ORDER PER: RATHOD KAMLESH JAYANTBHAI, AM These are two appeals filed by the assessee against two different orders of the Ld.CIT (Exemption), Jaipur both dated 11-02-2023 passed under section 12AB and 80G of the Income Tax Act, 1961 respectively. The grounds of appeal raised by the assessee in both the appeals are as under:-
2 ITA NO. 276/JP.2023 MODERN PUBLIC VIKAS SAMITI, TONK VS CIT (EXEMPTION), JAIPUR U/S 12AB of I.T. Act, 1961 GROUNDS OF APPEAL
1. The impugned order dated 11.02.2023 u/s 12 AB of the Act is bad in law and on facts of the case, for want of jurisdiction and various other reasons and hence, the same kindly be quashed.
2. The Id. CIT (Exemptions), Jaipur erred in law as well as on the facts of the case in holding that the appellant failed to get itself registered under the provision of Rajasthan Public Trust Act, 1959, which was a mandatory condition provided u/s 12AB (1)(b) of the Act and in holding the appellant as not eligible for registration u/s 12AB. The denial to grant registration on such a ground is completely contrary to the provision of law and facts and hence impugned order be quashed and the appellant be granted registration as prayed.
3. The ld. CIT (Exemptions), Jaipur erred in law as well as on the facts of the case in passing the impugned order without affording adequate and reasonable opportunity. The impugned order having been framed in gross breach of principle of natural justice, kindly be quashed or alternatively, may kindly be restored to the Id. CIT (Exemptions), Jaipur for a decision afresh after adequate and reasonable opportunity.
4. The Id. CIT (Exemptions), Jaipur erred in law as well as on the facts of the case in incorrectly holding that the application field was incomplete and documents as required, were not accompanied with Form 10 AB and those required during the course of hearing, were not submitted. Such findings and basis of denying registration u/s 12AB is contrary to the provision of law and facts and hence impugned order be quashed and the appellant be granted registration as prayed.
5. The Id. CIT (Exemptions), Jaipur erred in law as well as on the facts of the case in recording the findings adverse to the appellant trust which are contrary to the facts and material already on record and therefore, such finding kindly be negated/quashed.’’ ITA NO. 275/JP/2023 U/S 80G of I.T. Act, 1961
1. The impugned order dated 11.02.2023 u/s 80G of the Act is bad in law and on facts of the case, for want of jurisdiction and various other reasons and hence, the same kindly be quashed.
2. The denial to grant registration is completely contrary to the provision of law and facts and hence impugned order be quashed and the appellant be granted registration as prayed. .2023 MODERN PUBLIC VIKAS SAMITI, TONK VS CIT (EXEMPTION), JAIPUR
3. The Id. CIT (Exemptions), Jaipur erred in law as well as on the facts of the case in passing the impugned order without affording adequate and reasonable opportunity The impugned order having been framed in gross breach of principle of natural justice, kindly be quashed or alternatively, may kindly be restored to the ld. CIT (Exemptions), Jaipur for a decision afresh after adequate and reasonable opportunity.
4. The Id. CIT (Exemptions), Jaipur erred in law as well as on the facts of the case in denying the benefit of registration u/s 80G of the Act consequent to the rejection/denial to the registration sought by the appellant u/s 12AB of the act.
5. The Id. CIT (Exemptions), Jaipur erred in law as well as on the facts of the case in recording the findings adverse to the appellant trust which are contrary to the facts and material already on record and therefore, such finding kindly be negated/quashed.’’ 2.1 At the outset of hearing, the Bench observed that there is delay of 14 days in filing of both the appeals by the assessee for which the ld. AR of the assessee filed applications for condonation of delay mentioning therein the reason but the crux of the prayer is that that the applicant secretary and the other office bearers of the assessee/ samiti are layman and are not very conversant with the complex tax laws and the delay so caused was beyond their control but was bona fide and unintended for which the assessee was not going to gain any benefit because of delayed filing of appeal and their conduct was not contumacious. To this effect, the ld. AR of the assessee filed affidavit. .2023 MODERN PUBLIC VIKAS SAMITI, TONK VS CIT (EXEMPTION), JAIPUR 2.2. During the course of hearing, the ld. DR objected to assessee’s applications for condonation of delay and prayed that Court may decide the issue as deem fit and proper in the interest of justice.
2.3 We have heard the contention of both the parties and perused the materials available on record. The crux of delay in filing of the appeals by the assessee is that the applicant secretary and the other office bearers of the assessee/ samiti are layman and are not very conversant with the complex tax laws and the delay so caused was beyond their control but was bona fide and unintended for which the assessee was not going to gain any benefit because of delayed filing of appeal and their conduct was not contumacious. To this effect, the ld. AR of the assessee filed affidavits of the Secretary of the Samiti. The Bench noted that the prayer as mentioned above by the assessee for condonation of delay of 14 days in both the appeals has merit and we concur with the submissions of the assessee. Thus the delay occurred of 14 days in filing both the appeals by the assessee are condoned in view of the decision of Hon’ble Supreme Court in the case of Collector, land Acquisition vs. Mst. Katiji and Others, 167 ITR 471 (SC) as the assessee is prevented by sufficient cause.
5 ITA NO. 276/JP.2023 MODERN PUBLIC VIKAS SAMITI, TONK VS CIT (EXEMPTION), JAIPUR 3.1 Apropos to the ground so raised by the assessee in the ld. CIT(E) rejected the assessee’s claim of registration u/s 12AB of the Act by observing as under:- “3.4 Assessee vide Notice dated 07.12.2022 was given a show cause to submit documents/explanation by 14-12-2022, which is reproduced as under:- ‘’If the trust is not registered under Rajasthan Public Trust Act, 1959, please give explanation that why same should not be considered violation of law and accordingly why your application should not be rejected."
However, assessee has failed to prove that assesse is registered under RPT Act, 1959 as discussed above. In light of above discussion and in the absence of registration under Rajasthan Public Trust Act, 1959, assessee is not eligible for registration u/s 12AB.
Genuineness of Activities and non-compliance 4.1 It is important to mention here that while examining the claim of the assessee u/s 12AB of I.T. Act, the Commissioner of Income Tax has been empowered to call for such documents or information from the trust of institution as he thinks necessary in order to satisfy himself about the genuineness of the trust or institution and may also make such inquiries as he may deem necessary in this behalf. Under such powers vested in CIT(E), the applicant was asked to file details like:-
List of donors Bills and vouchers of expenses. Photograph of activities. Details of social handle.
However, the applicant has failed to comply with the letters. In the absence of such documents, it could not be determined whether the applicant is genuinely carrying out charitable activity as per its objects. Therefore, assessee claim of registration u/s 12AB is also liable to rejected on ground of not proving its genuineness of activity.
In view of above discussion assessee's claim of registration section 12AB is liable to be rejected and thus being rejected on following grounds:-
Incomplete Form 10AB Non-registration with RPT Act, 1959. Genuineness of Activities 3.2 Apropos to the ground so raised by the assessee in the ld. CIT(E) rejected the assessee’s claim of exemption u/s 80G of the Act by observing as under:- “1. The applicant filed online application on 08.08.2022 in Form No. 10AB for seeking exemption u/s 80G of the Income Tax Act, 1961.
As per rule 11AA of the Income Tax Rule, 1962, the registration u/s 12A/12AA or notification u/s 10(23C) is a precondition for granting approval u/s 80G of the I.T. Act, 1961. Vide this office order No. ITBA/EXM/F/EXM45/2022-23-/1049655397(1) dated 11-02-2023, the applicant Society/trust/samiti has been denied registration u/s 12AB. Therefore, it is not eligible for exemption u/s 80G of the I.T. Act, 1961. .2023 MODERN PUBLIC VIKAS SAMITI, TONK VS CIT (EXEMPTION), JAIPUR 3. In view of above discussion, the application in form No. 10AB seeking exemption u/s 80G is rejected. The applicant is, however, at liberty to apply afresh after completing the requisite details.” 3.3 During the course of hearing, the ld. AR of the assessee in both the appeals mainly submitted that the assessee was not provided adequate opportunity of being heard by the ld. CIT(E) and thus both the orders should be quashed being against the principles of natural justice. 3.4. Per contra, the ld. DR relied on the orders of the ld. CIT(E). 3.5 We have heard the rival contentions and perused material available on record. The Bench noted that ld. CIT(E) has rejected the applications of the assessee u/s 12AB and u/s 80G of the Act as narrated above in the respective orders. It is also pertinent to mention that during the course of hearing the ld. AR of the assessee prayed that he was deprived off availing of adequate opportunity of being heard by the ld. CIT(E) in both the orders (supra). The Bench does not want to go into merit of the case but it is imperative that the assessee must be provided adequate opportunity of being heard by the ld. CIT(E). In this view of the matter, the Bench feels that the assessee should be given one more chance to contest the case before the ld. CIT(E) and the ld. AR of the assessee is directed to produce all the relevant papers concerning both the applications so filed before the ld. CIT(E) to settle the dispute raised hereinabove. .2023 MODERN PUBLIC VIKAS SAMITI, TONK VS CIT (EXEMPTION), JAIPUR 3.6 Before parting, we may make it clear that our decision to restore the matter back to the file of the ld. CIT(E) shall in no way be construed as having any reflection or expression on the merits of the dispute, which shall be adjudicated by the ld. CIT(E) independently in accordance with law.