INITIATIVE SEWA FOUNDATION ,PUNE V. CIT(E) , PUNE

ITA 2703/PUN/2025

AI Insights

The case involves the Initiative Sewa Foundation, which appealed against the orders of the Commissioner of Income Tax (Exemptions), Pune, rejecting its applications for registration under sections 12A, 12AB, and 80G(5) of the Income Tax Act, 1961. The Foundation argued that the rejection was erroneous, citing the genuineness of its charitable activities and compliance with documentation requirements. However, the Tribunal found that the Foundation did not meet the necessary legal and procedural requirements for registration, including the lack of certified financial documents and the failure to issue donation receipts, which raised doubts about the genuineness of its activities.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 839604 (ITAT-PUNE)
• Duration Of Justice: 3 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-02-2026
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2025-2026
• Appeal Filed On: 18-11-2025
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: AMOL KHAIRNAR
• Assessee Lawyers: SIDDHANT G BISWAS
• Keywords: Set aside; Principle of natural justice
• Section: 11; 12AA; 12A; 80G

Judgement Text

" आयकर अपीलीय अधिकरण ”ए” न्यायपीठ पुणेमें। IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCHES “A” :: PUNE BEFORE DR.DIPAK P. RIPOTE, ACCOUNTANT MEMBER AND SHRI VINAY BHAMORE, JUDICIAL MEMBER आयकर अपऩल सं. / ITA Nos.2702 & 2703/PUN/2025 निर्धारण वषा / Assessment Year: 2025-26 Initiative Sewa Foundation, F.No.401, CTS 1105/7, Florinza Haveli, Harekrishna Path,s‟ Nagar, Model Colony, Pune – 411016. V s. CIT-Exemptions, Pune. PAN: AAHCI6014N Appellant/ Assessee Respondent / Revenue Assessee by Shri Siddhant G Biswas Revenue by Shri Amol Khairnar – CIT(DR) Date of hearing 21/01/2026 Date of pronouncement 24/02/2026 आदेश/ ORDER PER DR. DIPAK P. RIPOTE, AM: These two appeals filed by the assessee are directed against the separate orders of ld.Commissioner of Income Tax(Exemption), Pune rejecting the application for grant of registration u/s.12A r.w.s 12AB and 80G(5) of the Income Tax Act, 1961(hereinafter referred to as „the Act‟) both dated 18.09.2025. For the sake of convenience, these two appeals were heard together and are being disposed of by Printed from counselvise.com ITA Nos.2702 & 2703/PUN/2025 [A] 2 this common order. We treat the appeal in ITA No.2702/PUN/2025 as lead case. The assessee has raised following grounds of appeal : “1. Rejection of Final Registration Erroneous in Law: The learned CIT (Exemptions) erred in law and on facts in rejecting the application for final registration under Section 12A(1)(ac)(iii), holding that the genuineness of the activities of the Appellant could not be established. 2. Genuineness of Activities Established Prima Facie: The learned CIT (Exemptions) failed to appreciate the documentary evidence already submitted, including the status as a Section 8 Company, the detailed activities note, the formal MOUs with 13 schools, and the photographs, all of which established the genuineness of the charitable activities of the Appellant prima facie, as required by the law at the initial stage of registration. 3. MoA/Trust Deed: The learned CIT (Exemptions) erred in stating that an \"authentic copy\" of the Memorandum of Association (MOA) was not furnished, without specifically pointing out the defect in the submitted statutory documents of a Section 8 Company, which are public records. 4. Sole Donor Fact Ignored: The learned CIT (Exemptions) erred in concluding non-compliance regarding donor details when the Appellant had explicitly stated in its submission dated 11/08/2025 that Mr. Bhavnesh Desai is the sole donor (out of his tax-paid money), which should have sufficiently addressed the query for \"complete donation details.\" 5. Cancellation of Provisional Registration Ultra Vires: The learned CIT (Exemptions) erred in law in cancelling the provisional registration granted under Section 12A(1)(ac)(vi), as such cancellation is arbitrary, unwarranted, and a direct consequence of the erroneous rejection of the final registration application. 6. Sufficient Opportunity/Principle of Natural Justice: The learned CIT (Exemptions) erred in concluding non-compliance by the Appellant without adequately considering the submissions already made and without giving one final, effective opportunity to clarify minor Printed from counselvise.com ITA Nos.2702 & 2703/PUN/2025 [A] 3 documentation issues before passing a punitive rejection and cancellation order. 7. In view of the facts and grounds mentioned above, it is prayed that the order of the CIT (Exemptions), Pune, dated 18/09/2025, be set aside, and the CIT (Exemptions) be directed to grant the final registration to the Appellant under Section 12A(1)(ac) (iii) of the Income Tax Act, 1961. 8. Your appellant prays leave to produce such other evidence as may be necessary to substantiate its case. 9. The appellant craves leave to add, amend, alter, modify, or delete any of the grounds of appeal at or before the hearing.” Findings & Analysis : 2. We have heard both the parties and perused the records. In this case, Assessee had filed an application in Form No.10AB on 26.03.2025 for registration u/s.12A r.w.s 12AB of the Act. 3. The ld.Commissioner of Income Tax(Exemption) issued notices on 06.05.2025, 13.06.2025 and 22.08.2025. The assessee filed partial submission. Ld.CIT(E) rejected the application of the Assessee on the ground that Assessee had not filed authenticated copy of Certificate of Incorporation along with Memorandum of Association, complete details like Address, PAN, Date of donation was not provided, copies of bills for expenditure were not filed, copies of Financial Statements for F.Y.2024-25 not filed. Printed from counselvise.com ITA Nos.2702 & 2703/PUN/2025 [A] 4 4. Aggrieved by the order of ld.CIT(E), Assessee has filed appeal before this Tribunal. 5. In this case, ld.AR filed paper book. The Index Page of the paper book is scanned and reproduced here as under : 6. One can understand from the Index that Assessee has not filed copy of Income and Expenditure Account, Balance Sheet. Assessee has also not filed copy of receipt issued by Assessee to the Donor. Printed from counselvise.com ITA Nos.2702 & 2703/PUN/2025 [A] 5 On a specific query by the Bench, it was submitted that Assessee has not issued any receipt to the donors. 7. As per the procedure laid down by Income Tax Rules, Assessee has to submit specific documents along with Form No.10AB for obtaining registration u/s.12A r.w.s. 12AB of the Act. The Rule 17A of the Income Tax Rules specifies the documents to be submitted along with the form. The Rule 17A is reproduced here as under : (2) The application under sub-rule (1) shall be accompanied by the following documents, as required by Form No.10A or 10AB, as the case may be, namely:— (a) where the applicant is created, or established, under an instrument, self-certified copy of such instrument creating or establishing the applicant; (b) where the applicant is created, or established, otherwise than under an instrument, self-certified copy of the document evidencing the creation or establishment of the applicant; (c) self-certified copy of registration with Registrar of Companies or Registrar of Firms and Societies or Registrar of Public Trusts, as the case may be; (d) self-certified copy of registration under Foreign Contribution (Regulation) Act, 2010 (42 of 2010), if the applicant is registered under such Act; (e) self-certified copy of existing order granting registration under section 12A or section 12AA or section 12AB, as the case may be; (f) self-certified copy of order of rejection of application for grant of registration under section 12A or section 12AA or section 12AB, as the case may be, if any; (g) where the applicant has been in existence during any year or years prior to the financial year in which the application for registration is made, self-certified copies of the annual accounts of the applicant relating to such prior year or years (not being Printed from counselvise.com ITA Nos.2702 & 2703/PUN/2025 [A] 6 more than three years immediately preceding the year in which the said application is made) for which such accounts have been made up; (h) where a business undertaking is held by the applicant as per the provisions of sub-section (4) of section 11 and the applicant has been in existence during any year or years prior to the financial year in which the application for registration is made, self- certified copies of the annual accounts of such business undertaking relating to such prior year or years (not being more than three years immediately preceding the year in which the said application is made) for which such accounts have been made up and self-certified copy of the report of audit as per the provisions of section 44AB for such period; (i) where the income of the applicant includes profits and gains of business as per the provisions of sub-section (4A) of section 11 and the applicant has been in existence during any year or years prior to the financial year in which the application for registration is made, self-certified copies of the annual accounts of such business relating to such prior year or years (not being more than three years immediately preceding the year in which the said application is made) for which such accounts have been made up and self-certified copy of the report of audit as per the provisions of section 44AB for such period; (j) self-certified copy of the documents evidencing adoption or modification of the objects; (k) note on the activities of the applicant. (3) Form No. 10A or 10AB, as the case may be, shall be furnished electronically, — (i) under digital signature, if the return of income is required to be furnished under digital signature; (ii) through electronic verification code in a case not covered under clause (i). 7.1 Thus, it is mandatory for the Assessee to file certified copy of Memorandum of Association, Article of Association, Certified Copy of Financials etc. In this case, we have noted that Assessee has not filed Certified Copy of Financials. Ld.AR on specific query has admitted that no receipt was issued to the donors. Non-issuance of Printed from counselvise.com ITA Nos.2702 & 2703/PUN/2025 [A] 7 receipt to the donor itself creates doubts on the genuineness of the activity and financials of the assessee. In this case, it is noted that Assessee was registered on 27.03.2024 by Registrar of Companies(ROC). The application in Form No.10AB was dated 26.03.2025. Thus, from the date of incorporation, Assessee has completed one Financial Year, therefore, it was mandatory for assessee to file Income and Expenditure Account, Balance Sheet along with Form No.10AB. Assessee was already having a provisional registration u/s.12A dated 26.09.2024 valid up to A.Y.2027-28. In these facts, Assessee had time to file an application in Form No.10AB for permanent registration. However, Assessee chose to file application in FormNo.10AB dated 26.03.2025 without attaching required documents. Even during the proceedings before the ld.CIT(E), Assessee has not filed those documents mentioned by ld.CIT(E). In these facts and circumstances of the case, we hereby confirm the order of ld.CIT(E). 7.2 Accordingly, Ground No.1, 2 and 3 raised by Assessee are dismissed. Printed from counselvise.com ITA Nos.2702 & 2703/PUN/2025 [A] 8 8. In Ground No.4, Assessee has submitted that Mr.Bhavnesh Desai was a only donor. However, during the proceedings before the Tribunal, ld.AR has admitted that no donation receipt was issued by the Assessee to the donor. This explains that Assessee was not maintaining proper books of accounts. We have already reproduced list of documents submitted by Assessee and one can observe that nowhere details of donations have been filed. 8.1 In these facts and circumstances of the case, Ground No.4 raised by the Assessee is dismissed. 9. Ground No.5, Assessee‟s provisional registration has been cancelled by ld.CIT(E) as Assessee failed to prove genuineness of the activity. Assessee failed to file certified copies of the Memorandum of Association, Article of Association. Assessee failed to file Certified Copy of Financials. Therefore, ld.CIT(E) was right. In these facts, Ground No.5 of the Assessee is dismissed. 10. Ground No.6 alleges that ld.CIT(E) has not provided sufficient opportunity. In the beginning of the order, we have reproduced dates of notices issued by ld.CIT(E). Ld.CIT(E) had issued three notices. Thus, ld.CIT(E) had given sufficient opportunity to the Printed from counselvise.com ITA Nos.2702 & 2703/PUN/2025 [A] 9 assessee. As per Rule 17A of the Income Tax Rules, Assessee has to enclose all the necessary documents mentioned in Rule 17A along with Form No.10AB. In this case, Assessee had not enclosed Certified Copy of Memorandum of Association, Article of Association, Financials along with Form No.10AB. It is also noted that these documents were not filed subsequently. Therefore, ld.CIT(E) was right in rejecting the application of the Assessee. Accordingly, Ground No.6 raised by the Assessee is dismissed. 11. Ground No.7 and 8 are general in nature, need no adjudication, accordingly dismissed. 12. In the result, appeal of the assessee is dismissed. ITA No.2703/PUN/2025 – 80G 13. This is an appeal against the order under section 80G(5) of the Act, dated 18.09.2025. Ld.CIT(E) has rejected assessee‟s application for registration under section 80G(5) of the Act, only on ground that provision of section 12A(1)(ac)(iii) of the Act has been rejected. Printed from counselvise.com ITA Nos.2702 & 2703/PUN/2025 [A] 10 14. Since we have already decided the issue and dismissed grounds of appeal raised by the Assessee in ITA No.2702/PUN/2025 above, following similar reasoning‟s, grounds of appeal raised by the assessee in ITA No.2703/PUN/2025 are dismissed. 15. To sum up, both appeals of the assessee are dismissed. Order pronounced in the open Court on 24 February, 2026. Sd/- Sd/- VINAY BHAMORE Dr.DIPAK P. RIPOTE JUDICIAL MEMBER ACCOUNTANT MEMBER पपणे / Pune; ददिधंक / Dated : 24 Feb, 2026/ SGR आदेशकीप्रनिनलनपअग्रेनषि / Copy of the Order forwarded to : 1. अपऩलधर्थी / The Appellant. 2. प्रत्यर्थी / The Respondent. 3. The CIT(A), concerned. 4. The Pr. CIT, concerned. 5. नवभधगऩयप्रनिनिनर्, आयकर अपऩलऩय अनर्करण, “ए” बेंच, पपणे / DR, ITAT, “A” Bench, Pune. 6. गधर्ाफ़धइल / Guard File. आदेशधिपसधर / BY ORDER, // TRUE COPY // सहधयक रनिस्ट्रधर /Assistant Registrar आयकर अपऩलऩय अनर्करण, पपणे/ITAT, Pune. Printed from counselvise.com "