BHAGWAN MAHAVIR ARADHANA KENDRA ,NASHIK V. CIT(E), PUNE

ITA 2103/PUN/2024

AI Insights

The case involves Bhagwan Mahavir Aradhana Kendra, an organization that applied for registration under section 80G of the Income Tax Act, 1961, which was initially granted provisionally but later cancelled by the CIT(Exemption), Pune, due to non-compliance with certain requirements. The CIT(Exemption) issued notices to the assessee requesting various documents and clarifications to verify the genuineness of its activities and compliance with the conditions laid down in section 80G(5) of the Act. The assessee failed to comply with these notices, leading to the cancellation of the provisional approval. The assessee appealed against this decision, arguing that the rejection was made without proper consideration of the submissions and explanations provided. The Tribunal, after hearing both parties, decided to remand the case back to the CIT(Exemption) for a fresh evaluation, providing the assessee another opportunity to present its case.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 472580 (ITAT-PUNE)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-03-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2024-2025
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AMOL KHAIRNAR
• Assessee Lawyers: ABHAY AVCHAT
• Keywords: Set aside; Opportunity of being heard
• Section: 11; 10; 10(23C); 80G

Judgement Text

" आयकर अपीलीय अधिकरण “ए” न्यायपीठ पुणे में । IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, PUNE BEFORE SHRI R.K. PANDA, VICE PRESIDENT AND MS. ASTHA CHANDRA, JUDICIAL MEMBER आयकर अपील सं. / ITA No.2103/PUN/2024 धििाारण वर्ा / Assessment Year : 2024-25 Bhagwan Mahavir Aradhana Kendra, 4, Ahinsa Bhavan, Ahinsa Marg, Manik Nagar, Gangapur Road, Nashik – 422005 PAN : AAATB4033A Vs. CIT(Exemption), Pune अपीलार्थी / Appellant प्रत्यर्थी / Respondent Assessee by : Shri Abhay Avchat Department by : Shri Amol Khairnar Date of hearing : 06-01-2025 Date of Pronouncement : 21-03-2025 आदेश / ORDER PER ASTHA CHANDRA, JM : The appeal filed by the assessee is directed against the order dated 08.08.2024 of the Ld. Commissioner of Income Tax (Exemption), Pune [“CIT(E)”] whereby he rejected the application of the assessee filed before him in Form No. 10AB under clause (iii) of first proviso to sub-section (5) of section 80G of the Income Tax Act, 1961 (the “Act”) on 07.02.2024. 2. The brief facts are that on receipt of the assessee’s application filed in Form No. 10AB under clause (iii) of first proviso to section 80G(5) of the Act along with annexures thereto, with a view to verify the genuineness of the activities of the assessee and fulfillment of the conditions laid down in clauses (i) to (v) of section 80G(5) of the Act, the Ld. CIT(E) issued notice on 27.04.2024 through ITBA portal requesting the assessee to upload certain information/clarification such as date of commencement of activity, date of expiry of provisional approval, details of any other law applicable for achievement of objectives and the proof of compliance of said law, proof of identity of main trustees/directors /trustees, year-wise list of donations 2 ITA No.2103/PUN/2024 received, note on activities carried out etc. The compliance was sought by 13.05.2024. On verification of submission and documents furnished by the assessee in response to the said notice, the Ld. CIT(E) noted certain discrepancies which were duly communicated to the assessee vide another notice dated 05.07.2024 (listed in para 4(1) to (iv) of the impugned order). The assessee was requested to show cause as to why its application should not be rejected and the approval granted u/s 80G(5) of the Act should not be cancelled. The assessee was specifically informed that in the event of failure to comply by the due date i.e. 12.07.2024, the application shall be liable to be rejected and the approval shall also be liable to be cancelled. The said notice was duly served on the assessee through e-portal and email but remained un-complied with. Hence, another notice was issued to the assessee on 24.07.2024 seeking compliance by 31.07.2024. However, the assessee failed to furnish any explanation to the discrepancies noted by the Ld. CIT(E) which led him to presume that the assessee has nothing to say in the matter. The Ld. CIT(E) hence passed the impugned order rejecting the assessee’s application for final registration u/s 80G and cancelling the provisional approval dated 31.05.2021 granted under clause (iv) of first proviso to section 80G(5) of the Act by observing as under : “7 Considering the above facts discussed in the show notice and discrepancies noticed and also that the assessee has not complied with the provisions of sub-clause (a) of clause (ii) of second proviso to section 80G(5) of the Income Tax Act 1961 as well as the provisions of Rule 11AA(2) of Income Tax Rules, 1962 in spite giving sufficient opportunities, the undersigned is unable to draw any satisfactory conclusion about the genuineness of activities of the assessee and fulfillment of conditions laid down in clause (1) to (v) of section 80G(5) of the Act. 8. As per the condition vide clause (i) of section 80G(5) of the Income Tax Act, 1961, the approval is available only if the income of the institution or fund is not be liable to inclusion in its total income under the provisions of section 11 and 12 or clause (23AA) / clause (23C) of section 10 of the Income Tax Act, 1961. Exclusions for the said condition are detailed in clause (a), (b) and (c) of proviso to clause (i) of section 80G(5) of the Act. Therefore, the institution / fund is required to be regularly registered / approved either under section 12AB or 10(23AA) or 10(23C) of the Income Tax Act, 1961 or the institution / fund shall be a Regimental Fund or Non-Public Fund established by the armed forces of the Union for the welfare of the past and present members of such forces or their dependents. 9. In the instant case it is noticed that the assessee is neither regularly registered u/s 12AB read with section 12A(1)(ac) (i) /12A(1)(ac)(iii) nor having regular approval under section 10(23C) read with clause (i) / (iii) of first proviso to the said section and the case is not covered under the exclusions provided vide proviso to clause (i) of section 80G(5) of the Act. The assessee is not approved under section 10(23AA) of the Act. The assessee is also not a Regimental Fund or Non-Public Fund established by the armed forces of the Union for the welfare of the past and present members of such forces or their dependents.” 3 ITA No.2103/PUN/2024 3. Aggrieved, the assessee is in appeal before the Tribunal raising the following grounds of appeal :- “On facts and circumstances and in law, 1. The learned CIT (Exemption), Pune has erred in rejecting application for registration/renewal filed by Assessee under first proviso to section 80G(5)(iii) of the Income Tax Act, 1961 by passing order dated 8th August 2024. 2. Without considering the facts and circumstances of the case and the law, the Id. CIT Exemption has erred in rejecting assessee's application for registration/renewal. 3. The order of rejection has been passed without considering submission and explanation filed by the assessee and thus suffers from infirmity. 4. The Order passed by the CIT Exemption, Pune rejecting the assessee's application is not in keeping with provisions of law, is bad in law and thus the same needs to be set aside. 5. The Id. CIT Exemption erred in law and on facts in cancelling the provisional registration granted on 31/05/2021 without following the due process of law and without affording opportunity of hearing to the appellant. 6. The Ld. CIT has erred in concluding that the assessee is neither regularly registered u/s 12AB read with section 12A(1)(ac) (i) / 12A(1)(ac)(iii) nor having regular approval under section 10(23C) read with clause (i) / (iii) of first proviso to the said section and treating it as unregistered entity. 7. The Id. CIT Exemption erred in law and on facts in cancelling the provisional registration granted on 31/05/2021 in absence of any dissatisfaction about genuineness of activities of the appellant. 8. The Assessee prays for any other relief may be allowed to the Assessee under provisions of income tax law. 9. The assessee craves leave to add, alter, amend, modify, and delete any of the grounds of appeal.” 4. The Ld. AR submitted that there was no intentional non-appearance before the Ld. CIT(E). Non-compliance to the notices occurred on account of certain unavoidable circumstances. He submitted that given an opportunity the assessee is in a position to submit all the requisite details/ documentary evidence before the Ld. CIT(E) in support of its application and also give response to the specific discrepancies noted by him. He, therefore, prayed that the matter may be set aside to the file of the Ld. CIT(E) to adjudicate the same on merits afresh after affording one more opportunity of being heard to the assessee. 5. The Ld. DR conceded to the above proposition of the Ld. AR. 4 ITA No.2103/PUN/2024 6. We have heard the Ld. Representative of the parties and perused the records. On the facts and in the circumstances of the assessee’s case enumerated above, we are of the view that it would be judicially expedient and in the interest of justice and fair play if the matter is restored back to the file of Ld. CIT(E) to grant one more opportunity to the assessee to substantiate its case before him and consider the assessee’s application for approval u/s 80G afresh in light of the documents/details already available on record and such other supporting documents/evidence as may be called upon and/or submitted by the assessee during the fresh proceedings and decide the matter afresh on merits, in accordance with facts and law after allowing the opportunity of being heard to the assessee and present its case. The assessee shall provide the requisite support in terms of submitting the relevant details/documentary evidence as may be required/ called upon on the appointed date, failing which the Ld. CIT(E) shall be at liberty to pass appropriate order as per law. We order accordingly. 7. In the result, the appeal of assessee is treated as allowed for statistical purposes. Order pronounced in the open court on 21st March, 2025. Sd/- Sd/- (R.K. Panda) (Astha Chandra) VICE PRESIDENT JUDICIAL MEMBER पुणे / Pune; दिन ांक / Dated : 21st March, 2025. रदि आदेश की प्रधिधलधप अग्रेधर्ि / Copy of the Order forwarded to : 1. अपील र्थी / The Appellant. 2. प्रत्यर्थी / The Respondent. 3. The Pr. CIT concerned. 4. दिभ गीय प्रदिदनदि, आयकर अपीलीय अदिकरण, “ए” बेंच, पुणे / DR, ITAT, “A” Bench, Pune. 5. ग र्ड फ़ इल / Guard File. //सत्य दपि प्रदि// True Copy// आिेश नुस र / BY ORDER, िररष्ठ दनजी सदचि / Sr. Private Secretary आयकर अपीलीय अदिकरण ,पुणे / ITAT, Pune "