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Income Tax Appellate Tribunal, RAJKOT BENCH, RAJKOT
Before: SMT.ANNAPURNA GUPTA & SHRI T.R. SENTHIL KUMAR
आदेश/O R D E R
PER ANNAPURNA GUPTA, ACCOUNTANT MEMBER
The present appeal has been filed by the assessee against order passed by the Commissioner of Income Tax(Exemptions), Ahmedabad (in short referred to as ld.CIT(E) under section 12AA(3) of the Income Tax Act, 1961 ("the Act" for short), dated 17.1.2018 rejecting grant of registration as a charitable society under section 12AA of the Act.
The grounds of the appeal raised by the assessee are as under:
2 1. That the learned CIT (Exemption) Ahmedabad has wrongly rejected the application of registration u/s 12A(a) of the I. T. Act 2. That the findings of learned CIT (Exemption) Ahmedabad without any cogent evidence and thus the same are illegal & bad-in-law.
That the learned CIT (Exemption) Ahmedabad has ignored the principle of natural justice.
4. Solitary plea of the ld.counsel for the assessee before us was that the matter be restored back for reconsideration since adequate opportunity of hearing was not given to the assessee, and even otherwise, evidences placed on record by the assessee were not duly appreciated by the ld.CIT(E).
5. In this regard, the ld.counsel for the assessee pointed out that only two notices were issued to the assessee for hearing in the matter viz. one on 30.8.2017 and other on 25.12.2017. The ld.counsel for the assessee pointed out that due reply was filed by the assessee, which was noted by the ld.CIT(E) also, vide letter dated 5.1.2018 and most of the queries raised by the ld.CIT(E) in his notice were duly replied to it, and necessary details were also furnished. The ld.counsel for the assessee pointed out that the ld.CIT(E) dismissed the assessee’s application seeking approval under section 12AA of the Act stating that necessary documents for verifying whether the assessee was indeed carrying out charitable activities were not furnished by the assessee, without giving any further opportunity of hearing to the assessee. In this regard, he drew our attention to para 4 and 5 of the order of the ld.CIT(E) as under: “4. Following the principles of natural justice/ final opportunity was given to the assessee and notice was issued to the applicant on 25.12.2017 fixing hearing for 02.01.2018. In this letter, it was made amply clear to the applicant that in case of non-compliance, their application for registration is liable to be rejected for want of the details as asked for in the above-said letter. Part compliance was filed by post on 08.01,2018. It is noted that the submission is not endorsed by the competent person Since the applicant has not furnished the required details accordingly I am constrained to dispose of the registration application on the basis of material available on record.
Perusal of details filed reveals that the trust has not furnished the certified copy of memorandum of association and article of association either along with the Form IDA for registration nor during the submission filed by post on 08.01.2018. Further, documentary evidences of charitable activities carried out are not famished. Section 12AA makes it very clear that before :granting registration under this section, the Commissioner has to satisfy himself about fee genuineness of the activities of the trust or institution and also he has to verify that these; activities are in consonance with the objects of the trust or institution. Reliance in regard is placed on judgment delivered by the Hon. Supreme Court in the case of Commissioner of Income-tax , Ujjain Vs Dawoodi Bohara Jamat Civil Appeal No, 2492 of 2014. The facts considered in para 14 of the judgment by the Hon’ble Supreme Court are reproduced for sake of convenience. " Section 12AA lays s down the procedure to be followed by the Commission for grant or refusal of application for registration made under Section 12A, According to, procedure so laid down, the Commissioner shall call for documents and information and conduct an enquiry to satisfy himself of the genuineness of the trust and upon reaching satisfaction of charitable or religious nature of the objects and the authenticity of the activities of the trust he would grant registration. If he is not satisfied of the foresaid, the request made in the application may be declined.” As discussed above, the applicant has failed to file documentary evidences to enable me to satisfy about the genuineness of tits activities and to verify these activities are in consonance with the objects.
He further filed written submission before us pointing out that due replies had been filed by the assessee along with necessary documents and the ld.CIT(E) had passed the order without considering the same as under:
5. Ld.DR supported the order of the Ld.CIT(E).
We have gone through the order of the ld.CIT(E) carefully and considered the contentions of the ld.counsel for the assessee as also the documents referred to before us. Undoubtedly, the assessee has not been given adequate opportunity of hearing by the ld.CIT(E). Only two notices were issued on the assessee to which, as we have noted, the assessee had duly responded by filing necessary information and details. The letter of the assessee dated 5.1.2018 filed in response to the notice of the ld.CIT(E) dated 25.12.2017 placed before us at paper book pageno.15 , which has been taken note of by the ld.CIT(E) also in his order at para 4, reveals that the assessee had addressed most of the queries raised by the ld.CIT(E) in his notice. The ld.CIT(E) has rejected the grant of registration for the reason that certified copies of Memorandum and Articles of the Associations of the assessee-trust were not filed and also documentary evidences of charitable activities carried out by the assessee were not furnished.
In the absence of adequate opportunity granted to the assessee, we are of the view that the assessee’s application could not have been rejected for this reason. The ld.CIT(E) could very well have issued another notice seeking other documents from the assessee. In the interest of justice, therefore, we consider it fit to restore the issue back to the ld.CIT(E) to consider the issue of grant of registration under section 12AA of the Act afresh and thereafter pass order in accordance with law.
5 6. In the result, the appeal of the assessee is allowed for statistical purpose.
Order pronounced in the Court on 11th November, 2022 at Ahmedabad.