SANATAN DHARAM PARCHARAK SABHA REGD.,LUDHIANA vs. COMMISSIONER OF INCOME TAX (EXEMPTIONS), CHANDIGARH

PDF · subscribers
ITA 278/CHANDI/2024Status: DisposedITAT Chandigarh03 June 2024AY 2023-24Bench: SHRI A.D.JAIN (Vice President), SHRI KRINWANT SAHAY (Accountant Member)4 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The tribunal held that merely uploading a notice on the ITBA portal does not constitute effective service. Principles of natural justice require proper and adequate opportunity for the assessee to present their case.

What were the facts?

The assessee's application for registration under Section 12AA was rejected ex-parte by the CIT(E). The assessee claimed they did not receive any notice of hearing, and the notice was only uploaded on the ITBA portal.

What were the issues?

Whether uploading a notice on the ITBA portal amounts to effective service of notice and if the principles of natural justice were violated by the ex-parte order.

Which sections of the Income-tax Act were involved?

Section 12AA,Section 282(1)

AI-generated summary — verify with the full judgment below

PER A.D.JAIN, VICE PRESIDENT

1.

The present appeal has been preferred by the assessee against the order passed by the ld. Commissioner of Income Tax (Exemptions), Chandigarh [hereinafter referred to as ‘ld.CIT(E)’] dated 24.01.2024 pertaining to 2023-24 assessment year.

2.

The assessee in this appeal has raised the following ground of appeal :

ITA No.278/CHD/2024 A.Y. 2023-24 2

“That order passed under Section 12AA of the Income Tax Act, 1961 by the ld. Commissioner of Income Tax (Exemptions), Chandigarh is against law and facts on the file in as much as the appellant was prevented by a sufficient and reasonable cause in not responding to the impugned notices as the appellant did not receive any such notice.”

3.

At the outset, the ld. Counsel for the assessee has invited our attention to the impugned order of the ld.CIT(E) to submit that the same is an ex-parte order. He has submitted that the ld.CIT(E) has summarily rejected the application of the assessee, without giving any opportunity of hearing to the assessee to present its case. He has submitted that no notice of date of hearing was served by the ld.CIT(E), either through physical mode or through e-mail etc. That the notice of date of hearing was allegedly uploaded on ITBA Portal and the assessee was not aware of uploading of any such notice regarding date of hearing.

4.

The ld. DR could not rebut the aforesaid factual position.

5.

We have heard the parties and have perused the material on record. It is found that various notices fixing the date of hearing were issued through ITBA Portal. The ld. Counsel for the assessee stated that no such notice of hearing was ever received.

Merely uploading of information about the date of hearing on the Income Tax Portal is not an effective service of notice. The ITA No.278/CHD/2024 A.Y. 2023-24 3 matter now stands covered by the decision of the Hon'ble jurisdictional High Court in the case of ‘Munjal BSU Centre of Innovation and Entrepreneurship, Ludhiana through its authorized signatory Shri Bharat Goyal Vs Commissioner of Income Tax (E), Chandigarh’, in CWP 21028-2023 (O&M), wherein, vide order dated 04.03.2024, their Lordships have held that the provisions of Section 282(1) of the Income Tax Act and Rule 127(1) of the Income Tax Rules, 1962, envisage that it is essential that before any action is taken, a communication of the notice must be in terms of these provisions; that these provisions do not make mention of communication to be “deemed” by placing the notice on the e-portal of the Department; that an pragmatic view has always to be adopted in these circumstances; that an individual or a company is not expected to keep the e- portal of the Department open all the times so as to have knowledge of what the Department is supposed to be doing with regard to the submissions of forms, etc.; and that the principles of natural justice are inherent in the Income Tax provisions and the same are required to be necessarily followed. Accordingly, the impugned order of the ld.CIT(E) is, hereby set aside with a direction to the ld.CIT(E) to decide the appeal of the assessee afresh after giving proper and adequate opportunity to the ITA No.278/CHD/2024 A.Y. 2023-24 4 assessee to present its case. The assessee, no doubt, shall cooperate in the fresh proceedings before the CIT(E).

6.

The appeal of the assessee is allowed for statistical purposes.

Order pronounced on 03.06.2024.

More judgments on Section 12AA

All 4,243 judgments and leading authorities on Section 12AA →

Recent GST High Court judgments

Search GST case law →