JAGRITI FOUNDATION CHARITABLE TRUST , PATHANKOT V. COMMISSIONER OF INCOME TAX ( EXEMPTIONS), CHANDIGARH

ITA 174/ASR/2023

AI Insights

The case involves the Jagriti Foundation Charitable Trust appealing against the order of the Commissioner of Income Tax (Exemptions), Chandigarh, which rejected the Trust's application for regular registration under section 12AB(1) of the Income Tax Act, 1961. The rejection was initially done ex-parte, meaning without the presence or input of the Trust, which led to the appeal. The Trust's counsel argued that the rejection was illegal as the relevant section for the decision was not mentioned in the order, and claimed that no notices or communications were received by the Trust regarding the application. The CIT-DR supported the impugned order but did not object to the matter being restored for a fresh adjudication in the interest of natural justice.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 114398 (ITAT-AMRITSAR)
• Duration Of Justice: 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-07-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 09-07-2023
• Assessment Year: 2022-2023
• Appeal Filed On: 20-06-2023
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Charitable institution; Opportunity of being heard; Principle of natural justice

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH, AMRITSAR (VIRTUAL COURT) BEFORE DR. M. L. MEENA, ACCOUNTANT MEMBER AND SH. ANIKESH BANERJEE, JUDICIAL MEMBER I.T.A. No. 174/Asr/2023 Assessment Year: NA Jagriti Foundation Charitable Trust, Hunky Dory Resorts Dalhousie Road, Nihari Dhar Kalan, Pathankot 145001, [PAN: AADTJ 3252C] Vs. CIT (Exemptions), Chandigarh (Appellant) (Respondent) Appellant by : Sh. J. S. Bhasin, Adv. Respondent by: Dr. Vedanshu Tripathi, CIT DR Date of Hearing: 10.07.2023 Date of Pronouncement: 12.07.2023 ORDER Per Dr. M. L. Meena, AM: The captioned appeal is filed by the assessee against the order of the Ld. Commissioner of Income Tax (Exemptions), Chandigarh dated 08.05.2023 challenging therein rejecting the assessee’s application for grant of regular registration u/s 12AB(1) ex-parte qua the assessee. ITA No. 174/Asr/2023 Jagriti Foundation Charitable Trust v. CIT 2 2. At the outset, the ld. counsel for the assessee has submitted that the ld. CIT(E) has rejected the assessee’s application for grant of regular registration u/s 12AB(1) ex-parte qua the assessee is per se illegal when the relevant section under which passed, has not been mentioned in the order itself. The counsel argued that the notices issued that the ld. CIT(E) or any other communications for calling for information as discussed, in para 3 of the impugned order has neither been served nor received by the appellant assessee trust. The CIT(E) has also mentioned the very fact in para 3 of the impugned order that since it is a limitation matter, opportunity has been given to the assessee, however, he has not mentioned the factum of services of the notices to the effect of granting the opportunity of being heard to the assessee before proceedings to decide the matter ex- parte qua the assessee. The counsel has contended that the appellant trust had never received any aforesaid notices as claimed to have been issued by the ld. CIT(E) and hence a rejection of the application for grant of regular registration and cancellation of the provisions registration earlier granted, is per se an arbitrary, and against the principles of natural justice. The counsel has pleaded that the matter may be remanded back to the CIT(E) with the direction to adjudicate the matter afresh after granting ITA No. 174/Asr/2023 Jagriti Foundation Charitable Trust v. CIT 3 adequate opportunity of being heard, in order to enable the appellant trust to file the necessary details on the nature of the objects, genuineness of activities and any other information so desired by the ld. CIT(E) to satisfy itself for the purpose of granting registration u/s 12AB(1) as per law. The counsel undertakes that assessee shall cooperate in the fresh proceeding for adjudication of its application for grant of registration u/s 12AB(1) of the Act on merits of the case. 3. Per contra, the ld. CIT-DR supported the impugned order. He contended that there are three notices issued by the ld. CIT(E) to the appellant assessee, which remained un-complied. However, he has no objection to the request of the ld. AR in restoring the matter to the CIT(E) to adjudicate the matter afresh in view of the principles of natural justice. 4. Heard the rival contention, perused the material on record and the impugned order. Admittedly, the application for grant of registration u/s 12A(1)(ac)(iii) of the Act filed by the applicant on 24.11.2022 for grant of regular registration u/s 12AB(1) has been rejected by the ld. CIT(E) ex- parte qua the assessee trust. The ld. CIT(E) has mentioned that there are three notices for granting opportunity of being heard were issued to the applicant trust, however, he has not mentioned the factum of service of ITA No. 174/Asr/2023 Jagriti Foundation Charitable Trust v. CIT 4 these notices. Thus, the CIT(E) proceeded to reject the application of the trust ex-parte qua the applicant trust based on the material available on the record and thereby rejected the application by upholding that the assessee has been non co-operative, it can naturally be safely concluded that the assessee did not want to adduce the evidence as it would expose falsity and lack of genuineness. 5. From the above, it is evident that such an action of the ld. CIT(E) in rejecting the application for grant of regular registration and cancellation of provisional registration earlier granted is held to be per se arbitrary and against the principles of natural justice. In view of the matter, we consider it deem fit to restore back the matter to the file of the CIT(E) to adjudicate the application of the applicant trust for grant of regular registration u/s 12AB(1) afresh after granting adequate opportunity of being heard and considering the details filed along with the application and to be filed in the course of fresh proceedings. At the same time, the assessee trust is also directed to co-operate in the fresh proceedings by furnishing the relevant documents and evidences required by the ld. CIT(E) to his satisfaction on the queries raised in reference to the nature of the object and genuineness of the activities and the manner of carrying the activities as per amended ITA No. 174/Asr/2023 Jagriti Foundation Charitable Trust v. CIT 5 provisions of law for grant of registration under the Act. Accordingly, the matter is restored to the ld. CIT(E). 6. In the result, the appeal of the assesse is allowed for statistical purposes. Order pronounced in the open court on 12.07.2023 Sd/- Sd/- (Anikesh Banerjee) (Dr. M. L. Meena) Judicial Member Accountant Member *GP/Sr.PS* Copy of the order forwarded to: (1) The Appellant: (2) The Respondent: (3) The CIT(Appeals) (4) The CIT concerned (5) The Sr. DR, I.T.A.T. True Copy By Order