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Facts
The Assessee filed an application for approval under Section 80G of the Income Tax Act, which was rejected by the Ld. CIT(E) for being filed late. Subsequently, the Ld. CIT(E) rejected the application again on the ground that expenditure on charitable activities exceeded receipts.
Held
The Tribunal held that the additional evidence produced by the Assessee regarding the nature of expenditure needed to be examined by the Ld. CIT(E). Therefore, the matter was remanded.
Key Issues
Whether the Ld. CIT(E) erred in rejecting the application for approval under Section 80G without considering additional evidence and providing a proper opportunity of being heard.
Sections Cited
80G
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Income Tax Appellate Tribunal, DELHI
PER YOGESH KUMAR, U.S. JM: The present appeal is filed by the Assessee against the order of Ld.
Commissioner of Income Tax (Exemption) –Delhi (‘Ld. CIT(E)’ for short), Delhi dated 13/05/2025.
The appellant filed an Application for approval u/s 80G of the Income Tax Act, 1961 (‘Act’ for short). The said application has been rejected vide order dated 28/03/2024on the ground that the application has not been filed on time. Aggrieved by the order dated 28/03/2024, the Assessee preferred an appeal before the Tribunal in ITA No.
1673/Del/2024. The Co-ordinate Bench of the Tribunal vide order dated 20/08/2024, remanded the matter to the file of the Ld. CIT(E) for deciding the issue afresh. In pursuant to the order of the Tribunal dated 20/08/2024, the Ld. CIT(E) once again decided the application filed by the Appellant and vide order impugned dated 13/05/2025, dismissed the Application on the ground that expenditure incurred on the charitable activities are more than 100% of receipts. Aggrieved by the order of the Ld. CIT(E) dated 13/05/2025, the Assessee preferred the present Appeal.
The Appellant filed an application under Rule 29 of Income Tax Appellate Tribunal Rules for production of additional evidence, by producing copy of the audited accounts of all 31 Units of the Assessee to substantiate the claim that the expenditure incurred were not in the nature of religious expenditure.
The Ld. Counsel for the Appellant submitted that the Ld. CIT(E) has not provided opportunity to produce the requisite documents to show that the expenditure incurred were not in the nature of religious expenditure, therefore, filed application under Rule 29 of the Rules for admission of the same and sought for allowing the application and prayed for remanding the matter to the file of the Ld. CIT(E) for fresh consideration.
Per contra, the Ld. Department's Representative submitted that the Appellant has not provided requisite documents, therefore the Ld. CIT(E) rightly passed the order impugned, which requires no interference.
Thus, sought for dismissal of the present Appeal.
We have heard the parties and perused the material available on record. It can be seen from the order impugned, the Ld. CIT(E) has rejected the application on the ground that expenditure incurred on the charitable activities is more than 100% of receipts. Now, by way of additional evidence, the Assessee has produced the copy of audited accounts of all 31 Units before us to support the claim of the Assessee that expenditure incurred were not in the nature of religious expenditure. In our considered opinion, the additional evidence produced by the applicant will go into the roots of the matter which requires to be examined by the Ld. CIT(E) in order to come to the just conclusion. Therefore, we remand the matter to the file of the Ld. CIT(E) with a direction to consider all the documents produced by the Appellant and decide the application afresh after providing opportunity of being heard to the Appellant. The Appellant is also at liberty to produce any/all documents in support of its claim.
In the result, the appeal of the Appellant is partly allowed for statistical purpose.