GASTROENTEROLOGY PATIENT CARE WELFARE AND RESEARCH TRUST,CHANDIGARH vs. COMMISSIONER OF INCOME TAX EXEMPTIONS, CHANDIGARH

The appeal in this case has been filed on 31.01.2024 by the Assessee against the order dated 31.05.2023 of the ld. Commissioner of Income Tax Exemptions, Chandigarh [herein referred to as ‘CIT(E)’].

At the very outset, there is an Application from the Assessee for condonation of delay of 185 days. During the proceedings, the ld. Counsel of the Assessee submitted that the delay was because of the commutations were sent on the Income-tax portal, which the Assessee could not see in time. The ld. Counsel further requested to condone the delay as it was not deliberate on the part of the Assessee. The matter was discussed and it was decided to condone the delay. The ld. DR also did not raise any objection against this condonation of delay. Accordingly, the delay in filing the appeal is condoned and as such, we proceeded to hear the appeal on merits.

Brief facts of the case are that the Assessee is a Trust created by eminent doctors of Department of Gastroenterology, PGIMER, Chandigarh. The Assessee made an application under clause (iii) of the first proviso to section 80G(5) of the Income Tax Act, 1961 (in short 'the Act') on 3.12.2022. In response to that application, the ld. CIT(E), Chandigarh issued questionnaire electronically on 01.2.2023 and notices for furnishing certain documents / details through e- proceedings on e-filing portal. The ld. CIT(E) also issued notices on 2.5.2023 and 16.5.2023. Since the Assessee could not visit income tax portal in time therefore, there was no compliance on the part of the 98-Chd-2024 – Gastroenterology Patient Care Welfare and Research Trust, Chandigarh 3 Assessee. The Assessee did not receive any communication either through e-mail or thorough post regarding such notices. In the absence of any compliance from the Assessee, the ld. CIT(E) rejected the application vide order No. ITBA/EXM/F/EXM45/2023- 24/1053359990(1) dated 31.5.2023. The ld. CIT(E), in her order has mentioned that in order to examine and verify the objects of the trust or the institution, the genuineness of its activities and fulfillment of all the conditions laid down in clauses (i) to (v) of section 80G(5) of the Act, a questionnaire was issued electronically on 01.02.2023 requesting the applicant to furnish the certain documents/details online through e-proceedings on e-filling portal along with the supporting documents/evidence, point wise in the sequence by 16.02.2023. It has further been mentioned by the ld. CIT(E) as under:- “3. On the stipulated date neither any submission was made nor was any request for adjournment or other communication received from the applicant through any channel. Another letter granting necessary opportunity was issued to the applicant on 02.05.2023 and the matter was fixed for reply by 08.05.2023. On this date, likewise, neither any online/offline reply was submitted nor was any request for adjournment or other communication received from the applicant. In the interests of natural justice, final opportunity was then accorded to the applicant on 10.05.2023 and the matter

During the course of hearing before us, the ld. Counsel of the Assessee brought on record various case laws including that of the Hon'ble jurisdictional High Court of Punjab & Haryana, 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 98-Chd-2024 – Gastroenterology Patient Care Welfare and Research Trust, Chandigarh 5 the Department; that a 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.

The ld. DR, on the other hand, has supported the order of the ld. CIT(E).

We have considered facts brought on record by the ld. Counsel of the Assessee and arguments of the ld. DR along with the findings of the ld. CIT(E) in her order. We find that the main issue in this case is non-compliance by the Assessee because all notices were sent on Income Tax e-portal and the Assessee could not see the same on e- portal in time. We find this is squarely covered by jurisdictional High Court order in the case of ‘Munjal BSU Centre of Innovation and Entrepreneurship, Ludhiana through its authorized signatory Shri Bharat Goyal Vs CIT (E), Chandigarh’, (supra). Therefore, respectfully following the ratio decided by the jurisdictional High Court on the 98-Chd-2024 – Gastroenterology Patient Care Welfare and Research Trust, Chandigarh 6 issue and considering all the facts and circumstances, the impugned order of the ld. CIT(E) is set aside and the matter is restored to the file of the CIT(E) to decide the application of the assessee for final approval of registration on merits after giving adequate opportunity to the assessee to present its case. The assessee, no doubt, shall cooperate in the fresh proceedings before the ld. CIT (E). For, statistical purposes, the appeal of the assessee is treated as allowed.

In the result, the appeal of the Assessee is allowed.