PRAGYAWAN FOUNDATION,GHAZIABAD vs. ITO EXEMPTION, GHAZIABAD

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ITA 3005/DEL/2022Status: DisposedITAT Delhi24 August 2023Bench: the ld. CIT (E).3 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal found that the assessee was given very short notices and requested another opportunity. The Tribunal decided to remit the issue back to the CIT (Exemption) for fresh consideration after providing an opportunity of being heard.

What were the facts?

The assessee trust applied for registration under section 12AB of the Income Tax Act. The CIT (Exemption) rejected the application due to non-compliance and lack of proof regarding the genuineness and charitable nature of activities.

What were the issues?

Whether the CIT (Exemption) erred in rejecting the application for registration under section 12AB without providing adequate opportunity to the assessee. The genuineness and charitable nature of the trust's activities.

Which sections of the Income-tax Act were involved?

Section 12AB,Section 12A(1)(ac)(iii)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH ‘F’ : NEW DELHI

For Appellant: Shri Rohan Sogani, CA
For Respondent: Shri Sanjay Gupta, CIT DR
Hearing: 22.08.2023

ASSESSEE BY : Shri Rohan Sogani, CA REVENUE BY : Shri Sanjay Gupta, CIT DR Date of Hearing : 22.08.2023 Date of Order : 24.08.2023

ORDER PER SHAMIM YAHYA, ACCOUNTANT MEMBER :

This appeal filed by the assessee is directed against the order of ld. CIT (Exemption), Lucknow dated 27.10.2022. 2. Grounds of appeal taken by the assessee read as under :-

“1. In the facts and circumstances of the case and in law the ld. CIT (Exemptions) has erred in rejecting the application for registration under section 12AB of Income Tax Act, 1961 of the assessee trust. The action of ld. CIT (Exemptions) is illegal, unjustified, arbitrary and against the facts of the case. Registration may please be granted under section 12AB.

2 /Del./2022 2. In the facts and circumstances of the case and in law, ld. CIT (Exemption) has grossly erred in rejecting the application for registration under section 12AB of the Income Tax Act, 1961, without providing adequate opportunity to the assessee trust to make requisite submissions. The action of the ld. CIT (Exemption) is illegal, unjustified, arbitrary and against the facts of the case. Registration may please be granted under Section 12AB.”

3.

The assessee had filed an application dated 28.04.2022 for registration under section 12A(1)(ac)(iii) of the Income-tax Act, 1961 (for short 'the Act') in Form No.10AB. Ld. CIT (E) noted that several notices were issued for the assessee’s compliance but the assessee did not comply. Accordingly, ld. CIT (E) concluded as under :-

“3. As the application has been submitted under sub clause (iii) of 12A(1)(ac) and accordingly an enquiry letter requiring such documents and information was sent to verify the genuineness of the activities as well as charitable nature and commencement of the activities. In absence of any reply charitable object and genuineness of the charitable activities of the assessee trust could not be proved. Hence the application of the above mentioned society is treated as "non-maintainable.

4.

Accordingly the application filed by the assessee is hereby 'rejected'. However, no adverse inference is drawn against the assessee and rejection of its application shall not affect the provisional approval if any, granted u/s 12A/80G(5) of the Act, by the CPC.” 4. Ld. Counsel for the assessee prayed that very short notices have been given and he further prayed that one more opportunity may be granted to the assessee before the ld. CIT (E).

3 /Del./2022 5. Upon careful consideration and in the interest of justice, we remit the issue to the file of ld. CIT (E). Ld. CIT (E) will consider the issue afresh after providing the assessee an opportunity of being heard.

6.

In the result, the assessee’s appeal stands allowed for statistical purposes. Order pronounced in the open court on this 24th day of August, 2023.

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