Arogya Seva Samiti, Mehsana V. The Commissioner of Income Tax (Exemption), Ahmedabad

ITA 488/AHD/2022

• Counselvise Citation: [2023] 100 COUNSELVISE.COM (IT) 4606 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-12-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 10-12-2023
• Assessment Year: 2022-2023
• Appeal Filed On: 23-11-2022
• Result in Favour of: Matter Remanded
• Court: TRIBUNAL
• Assessee Lawyers: BIREN SHAH
• Keywords: Tangible material
• Section: 22

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL “B” BENCH, AHMEDABAD BEFORE SHRI WASEEM AHMED, ACCOUNTANT MEMBER & SHRI SIDDHARTHA NAUTIYAL, JUDICIAL MEMBER I .T .A . N o . 4 8 8/ A h d /2 0 22 ( A s se ss m e nt Y e a r : 20 22- 2 3 ) A r o g ya Se va S a m it i , A t P o B h a nd u, B ha nd u, V i sn a g a r , M e h s a n a-38 41 2 0 V s .C o mm i s si o n er o f I n co m e Ta x ( Ex e m pt io ns ), Ah me da bad [ P A N N o . AA A T A6 19 6 K ] (Appellant) .. (Respondent) Appellant by : Shri Biren Shah, A.R. Respondent by: Shri Darsi Suman Ratnam, CIT D.R. D at e of H ea r i ng 11.12.2023 D at e of P r o no u n ce me nt 20.12.2023 O R D E R PER SIDDHARTHA NAUTIYAL, JM: This appeal has been filed by the Assessee against the order passed by the Ld. Commissioner of Income Tax (Exemptions) (in short “Ld. CIT(E)”), Ahmedabad vide order dated 26.09.2022 passed for the Assessment Year 2022-23 2. The assessee has raised the following grounds of appeal:- “1. The Commissioner of Income Tax (Exemption) Ahmedabad has erred in Law and on facts, in rejecting the application in form 10AB U/S 12AB of the Income Tax Act, 1961, on non satisfaction of genuineness of the activities of the trust. 2. The CIT(Exemption) has erred n law, in over looking and in summarily rejecting and not considered, the tangible material submitted during the proceeding u/s 12AB of Income Tax Act, 1961. 3. Your appellant crave, leave to add, alter, & or to amend modify substitute all or any ground of appeal before final hearing if necessity so arise” ITA No. 488/Ahd/2022 Arogya Seva Samiti vs. CIT(E) Asst. Year –2022-23 - 2 - 3. The brief facts of the case are that the assessee filed application for registration of trust under Section 12AB of the Act on 31.03.2022 in Form No. 10AB under Rule 17A of the Income Tax Rules, 1962. Notices were issued by CIT(E), Ahmedabad on 16.07.2022, in response to which the assessee filed reply in which certain details were furnished. Thereafter, Ld. CIT(E) issued another notice on 03.08.2022 in response to which the assessee filed another reply. Thereafter, the Ld. CIT(E) passed order rejecting the grant of approval to the assessee with the following observations:- “5. I am therefore, constrained to dispose of the application for registration u/s. 12AB of the I.T. Act, 1961 on the basis of material available on records. The details filed by the applicant are peripheral and the response is cryptic in nature. Perusal of form 10AB and subsequent submissions reveal that the following crucial information/documents has not been supplied; i) Certified copy of Undertakings of Section 2(15), 11(5), 12AB, 13(1)(c) & 13(3). ii) Income & Expenditure Account for F. Y. 2021-22. (iii) Audited Provisional Account for F. Y. 2021-22. (iv) Undertaking regarding adherence towards all the requirements of law as are material for the purpose of its objects as enumerated in the trust deed. v) Details regarding donations received & paid. vi) Notes on activities conducted since inception vii) No Objection Certificate from the owner of the premises from which it operating along with proof of his ownership. viii) Bank details. 6. In spite of specific requisitions, the applicant has not submitted the requisite details. Therefore, no verification of the objects as per the trust deed with the activities carried out if any could be made. Thus, the genuineness of the activities does not get established. Further, on perusal of Audit report for F.Y. 2019-20, it is ITA No. 488/Ahd/2022 Arogya Seva Samiti vs. CIT(E) Asst. Year –2022-23 - 3 - noticed that the trust has not incurred any expense towards objects of the trust. Section 12AB makes, it very clear that before granting registration under this section, the Commissioner has to satisfy himself about the genuineness of the activities of the trust or institution and also he has to verify that these activities are in consonance with the objects of the trust or institution. Further, he has to ensure that other laws material for the purpose of achieving objects are complied. Reliance in this regard is also placed on the judgment delivered by the Hon'ble Supreme Court in the case of Commissioner of Income-tax, Ujjain Vs Dawoodi Bohara Jamat Civil Appeal No. 2492 of 2014. 7. Further opportunity as per the provisions of Sub-clause (b)(ii)(B) of clause (1) of section 12AB was granted vide letter dated 29/08/2022 & 15.09.2022 but the assessee did not respond, thereby implying it was no objection on rejection of its application and cancellation of its registration. 8. As discussed above, the applicant has failed to enable me to satisfy about the genuineness of its activities and to verify these activities are in consonance with its objects. 9. Looking to the above facts, I am unable to arrive at the satisfaction of the genuineness of the activities. Hence, the application filed in Form No. 10AB for the registration u/s. 12AB of the I.T. Act, 1961, is rejected.” 4. The assessee in appeal before us against the aforesaid order passed by Ld. CIT(E). 5. At the time of hearing of the appeal, Ld. Counsel appearing for the appellant submitted before us that it is an admitted fact that though in spite of best effort made by the appellant, the entire set of documents could not be gathered during the pendency of the proceeding before the Ld. CIT(E) and the appellant was, thus, unable to submit the same in order to satisfy the Ld. CIT(E) with regards to the genuineness of the activities carried out by the Trust. In view of the matter, he prayed for another opportunity of being heard to the appellant by the Ld. CIT(E) and undertakes to file the requisite documents and/or evidence in support of the case made out by the appellant for grant of registration under Section 12AB of the Act. A copy of each of the documents has been annexed to the paper book filed by the appellant ITA No. 488/Ahd/2022 Arogya Seva Samiti vs. CIT(E) Asst. Year –2022-23 - 4 - before us. Such prayer made by the Ld. AR has not been controverted by Ld. DR in all his fairness. 6. Having heard the Learned Counsel appearing for the parties and having regard to the facts and circumstances of the case, we, in order to prevent the miscarriage of justice, find it fit and proper to provide another opportunity of being heard to the appellant in support of his case for registration of the Trust under Section 12AB of the Act. We, thus, dispose of this appeal by restoring the issue to the file of the Ld. CIT(E) with a direction upon him to provide further opportunity of being heard to the appellant and to consider the documents and/or evidence which the appellant would file as per the direction issued by the Ld. CIT(E). Upon considering the entire set of documents and upon affording an opportunity of being heard to the appellant the Ld. CIT(E) to dispose of the application for grant of registration of the Trust under Section 12AB of the Act with a reasoned order. We also make it clear, that in the event, the appellant doesn’t co-operate with the Ld. CIT(E) as directed hereinabove, the Ld. CIT(E) would be at liberty to pass orders strictly in accordance with law. 7. In the result, assessee’s appeal is allowed for statistical purposes. This Order pronounced in Open Court on 20/12/2023 Sd/- Sd/- (WASEEM AHMED) (SIDDHARTHA NAUTIYAL ) ACCOUNTANT MEMBER JUDICIAL MEMBER Ahmedabad; Dated 20/12/2023 TANMAY, Sr. PS TRUE COPY ITA No. 488/Ahd/2022 Arogya Seva Samiti vs. CIT(E) Asst. Year –2022-23 - 5 - आदेश क त ल प अ े षत/Copy of the Order forwarded to : 1. अपीलाथ / The Appellant 2. यथ / The Respondent. 3. संबं धत आयकर आय ु त / Concerned CIT 4. आयकर आय ु त(अपील) / The CIT(A)- 5. वभागीय त न ध, आयकर अपील!य अ धकरण, अहमदाबाद / DR, ITAT, Ahmedabad 6. गाड' फाईल / Guard file. आदेशान ु सार/ BY ORDER, उप/सहायक पंजीकार (Dy./Asstt.Registrar) आयकर अपील य अ धकरण, अहमदाबाद / ITAT, Ahmedabad 1. Date of dictation 15.12.2023 2. Date on which the typed draft is placed before the Dictating Member 18.12.2023 3. Other Member..................... 4. Date on which the approved draft comes to the Sr.P.S./P.S 19.12.2023 5. Date on which the fair order is placed before the Dictating Member for pronouncement .12.2023 6. Date on which the fair order comes back to the Sr.P.S./P.S 20.12.2023 7. Date on which the file goes to the Bench Clerk 20.12.2023 8. Date on which the file goes to the Head Clerk.......................................... 9. The date on which the file goes to the Assistant Registrar for signature on the order.......................... 10. Date of Despatch of the Order..........................................