CODINGFORALL FOUNDATION,SECUNDERABAD V. CIT (EXEMPTIONS), HYDERABAD.

ITA 1400/HYD/2024

AI Insights

The case involves Codingforall Foundation, a trust, which appealed against the decision of the Commissioner of Income Tax (Exemptions), Hyderabad, denying their registration under Section 12AB of the Income Tax Act, 1961. The CIT (Exemptions) had initially rejected the application due to non-submission of required information within the stipulated time. However, the trust contended that they had submitted the necessary documents and requested additional time, which was not considered by the CIT (Exemptions). The Tribunal found that the CIT (Exemptions) had not properly considered the submissions made by the trust and thus set aside the rejection order, remanding the case for a fresh decision.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 46058 (ITAT-HYDERABAD)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-03-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB-B
• Assessment Year: 2024-2025
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Set aside; Opportunity of being heard
• Section: 12A

Judgement Text

"1 आयकर अपीलȣय Ûयायाͬधकरण मɅ, हैदराबाद ‘बी’ बɅच, हैदराबाद IN THE INCOME TAX APPELLATE TRIBUNAL Hyderabad ‘ B ‘ Bench, Hyderabad Įी मंजूनाथ जी, माननीय लेखा सदèय एवं Įी रवीश सूद, माननीय ÛयाǓयक सदèय SHRI G. MANJUNATHA, HON’BLE ACCOUNTANT MEMBER AND SHRI RAVISH SOOD, HON’BLE JUDICIAL MEMBER आयकरअपीलसं./I.T.A.No.1400/Hyd/2024 (िनधाŊरण वषŊ/ Assessment Year:2024-25) Codingforall Foundation, Secunderabad. PAN: AAJCC1522B VS. Commissioner of Income Tax (Exemptions), Hyderabad. (अपीलाथŎ/ Appellant) (ŮȑथŎ/ Respondent) करदाता का Ůितिनिधȕ/ Assessee Represented by : Shri Srinarayan Toshniwal, Advocate राजˢ का Ůितिनिधȕ/ Department Represented by : Mrs. M. Narmada, CIT-DR सुनवाई समाɑ होने की ितिथ/ Date of Conclusion of Hearing : 11.03.2025 घोषणा की तारीख/ Date of Pronouncement : 19.03.2025 O R D E R Ůित रवीश सूद, जे.एम./PER RAVISH SOOD, J.M. The present appeal filed by the assessee trust is directed against the order passed by the Commissioner of Income-Tax (Exemptions), Hyderabad [for short “CIT (Exemptions)”] declining the assessee’s claim for registration under Section 12AB of the Income-tax Act, 1961 (in short ‘the Act’) vide his order dated 24/10/2024. 2 2. The assessee-trust has assailed the impugned order on the following grounds of appeal before us: “1. The order of the Commissioner of Income Tax (Exemptions) is not correct both on facts and in law. 2. The Ld. CIT (Exemptions) is not justified in denying the registration U/s. 12A of the Income Tax Act, 1961. 3. The Ld. CIT (Exemptions) is not justified in denying registration on the ground that no response was filed especially when all the details were in response to notice dated 16/08/2024 and are on the record. 4. The Ld. CIT (Exemption) failed to appreciate that all the details sought in the notice dated 18/10/2024 were already submitted in the Appellant’s previous replies. 5. The appellant craves leave to add, amend, alter or rescind any of the above grounds of appeal before or at the time of hearing.” 3. Succinctly stated, the assessee-trust had filed an application in “Form 10AB” seeking registration under Section 12AB of the Act. 4. The CIT (Exemptions), Hyderabad, issued notices dated 08/06/2024 and 16/08/2024, calling upon the assessee-trust to produce copy of its Memorandum of Association/Trust Deed for verification alongwith a detailed reply on certain specific issues that was called for in the said notice. In response, the assessee-trust submitted partial information. Thereafter, the CIT (Exemptions) vide another notice dated 18/10/2024 called upon the assessee-trust to furnish the balance information a/w supporting documentary evidence latest by 22nd October, 2024 by 11.00 am. 5. As the assessee-trust had failed to effect compliance with the aforesaid notice dated 18/10/2024 (supra) within the stipulated time, 3 therefore, the CIT (Exemptions) in absence of the requisite details was constrained to reject its application seeking registration under Section 12AB of the Act. For the sake of clarity, the observations of the CIT (Exemptions) are culled out as under: “3. In response to the above notice, the assessee requested for an additional time of 2 days to submit the information as called for. However, no information as called for or any documentary evidence with regard to the information called for has been submitted by the assessee so far. As the application in form 10AB is to be decided in time bound manner and the present application in Form 10AB is going to be time barred by 31/10/2024 and non-submission of mandatory information to infer whether the activities of the trust are in line with the objectives of the trust or not. In view of the above, the present application in Form 10AB for registration U/s. 12AB is herewith rejected.” 6. Aggrieved, the assessee-trust has assailed the order passed by the CIT (Exemptions) in appeal before us. 7. We have heard the learned Authorized Representatives of both the parties, perused the orders of the lower authorities and the material available on record. 8. Sri Srinarayanan Toshniwal, Learned Authorized Representative (in short, “AR”) for the assessee-trust, at the threshold of hearing, submitted that the CIT (Exemptions) had most arbitrarily rejected the application filed by the assessee-trust for registration U/s. 12AB of the Act. Elaborating on his contention, the Ld. AR submitted that the assessee-trust in compliance to the notice dated 18/10/2024 (supra) issued by the CIT (Exemptions), wherein it was directed to furnish the 4 requisite details before 22nd October, 2024 by 11.00 am, had vide a letter dated 22/10/2024 requested him for a further period of 02 days for furnishing the required details. The Ld. AR to substantiate his aforesaid claim had drawn our attention to the adjournment letter that was uploaded by the assessee-trust with the CIT(Exemptions), Hyderabad on 22/10/2024. Carrying his contention further, the Ld. AR submitted that the assessee-trust had thereafter on the very next day i.e., on 23rd October, 2024 furnished/uploaded its written submissions a/w supporting documentary evidence. The Ld. AR to substantiate his claim had drawn our attention to the submissions that were uploaded by the assessee-trust with the CIT(Exemptions), Hyderabad on 23/10/2024, Page 17 & 18 of the assessee’s paper book (in short, “APB”). The Ld. AR submitted that the CIT(Exemptions) after taking cognizance of the assessee’s request for a further time of 02 days for collating and furnishing the documentary evidence/reply, had not only most arbitrarily brushed aside the same but also not considered the reply/documentary evidence that was uploaded by the assessee-trust on 23/10/2024. The Ld. AR submitted that the summarily rejection of the application filed by the assessee-trust for registration under Section 12AB of the Act by the CIT (Exemptions), Hyderabad did not merit to be sustained and in all fairness be set aside. 9. Per contra, Ms. M. Narmada, Ld. CIT-DR supported the order of the CIT(Exemptions). The Ld. CIT-DR submitted that nothing is 5 discernible from record which would evidence that the assessee-trust had filed any submissions/documentary evidence on 23rd October, 2024 with the CIT(Exemptions). 10. We have thoughtfully considered the facts involved in the present case in the backdrop of the contentions advanced by the Learned Authorized Representatives of both the parties. 11. Admittedly, it is a matter of fact borne from record that the CIT(Exemptions), vide his notice dated 18/10/2024 (supra), had called upon the assessee-trust to file its submissions a/w supporting documents on or before 22nd October, 2024 by 11.00 am. We find that the assessee-trust on the stipulated date i.e., on 22nd October, 2024, had uploaded an application seeking adjournment for 02 days, Page 16 of the APB. Also, it transpires that the assessee-trust had thereafter on the very next day i.e., on 23rd October, 2024 had uploaded its reply/ submissions a/w the requisite documents as attachment, Pages 17 & 18 of the APB. We find that the CIT(Exemptions) in his order dated 24/10/2024 had though referred to the request of the assessee-trust for additional time of 02 days to submit the requisite information, but had summarily declined the same. Apart from that, it transpires that the CIT(Exemptions) after summarily rejecting the assessee’s request for adjournment, had proceeded with the matter and without considering the response/submissions/documents that were filed by 6 the assessee-trust vide its reply uploaded on 23rd October, 2024, Pages 17 to 25 of the APB, summarily rejected its application for registration under Section 12AB of the Act. We find it incomprehensible that when the response/submissions of the assessee-trust alongwith supporting documentary evidence were before the CIT (Exemptions), Hyderabad on the date of passing of the order i.e. 24th October, 2024, then, why the same were not considered by him? We are of a firm conviction that as the CIT(Exemptions), Hyderabad, had summarily rejected the application filed by the assessee-trust for registration under Section 12AB of the Act i.e., without considering the response/documents that were uploaded by the assessee-trust and were available before him as on the date of passing of the order, therefore, the order so passed by him cannot be endorsed and accepted on our part. 12. We, thus, in all fairness, set-aside the order passed by the CIT(Exemptions), Hyderabad rejecting the application filed by the assessee-trust for registration under Section 12AB of the Act. Accordingly, the matter is restored to the file of the CIT (Exemptions), Hyderabad with a direction to him to re-consider afresh the assessee’s application for registration under Section 12AB of the Act. Needless to say, the CIT(Exemptions) shall in the course of the set-aside proceedings afford a reasonable opportunity of being heard to the assessee-trust. 7 13. Resultantly, the appeal filed by the assessee-trust is allowed for statistical purposes in terms of our above observations. 19th माच[, 2025 को खुलȣ अदालत मɅ सुनाया गया आदेश। Order pronounced in the Open Court on 19th March, 2025. Sd/- Sd/- Sd/- (मंजूनाथ जी) (MANJUNATHA G.) लेखा सद˟/ACCOUNTANT MEMBER S d/- Sd/- (Įी रवीश सूद) (RAVISH SOOD) Ɋाियक सद˟/JUDICIAL MEMBER Sd/- Sd Hyderabad, dated 19.03.2025. **OKK/sps आदेशकी Ůितिलिप अŤेिषत/ Copy of the order forwarded to:- 1. िनधाŊįरती/The Assessee : Codingforall Foundation, C/o. Katrpati & Associates, 1- 1-298/2/B/3, Sowbhagya Avenue Apts, 1st Floor, Ashok Nagar, Street No.1, Hyderabad. 2. राजˢ/ The Revenue : CIT (Exemptions) O/o. CIT (Exemptions), Aatyakar Bhavan, Basheerbagh, Opp. LB Stadium, Hyderabad, Telangana-500004. 3. The Principal Commissioner of Income Tax, Hyderabad 4. िवभागीयŮितिनिध, आयकर अपीलीय अिधकरण, हैदराबाद / DR, ITAT, Hyderabad 5. The Commissioner of Income Tax 6. गाडŊफ़ाईल / Guard file आदेशानुसार / BY ORDER Sr. Private Secretary ITAT, Hyderabad "