Maji Aamdar Dattu Sheth Patil, Panvel V. Commissioner of Income-Tax (Exemption), Pune

ITA 616/PUN/2021

AI Insights

The case involves two appeals by Maji Aamdar Dattu Sheth Patil Shikshan Prasarak Mandal against the orders of the CIT (Exemption), which denied registration under section 12AA of the Income-tax Act, 1961. The primary issue in both appeals was the denial of registration due to the alleged failure of the trusts to provide sufficient documentation and evidence to establish the genuineness of their charitable activities. The Tribunal noted that the trusts were given multiple opportunities to comply with the documentation requirements but failed to do so. However, in the interest of justice, the Tribunal decided to remand the cases back to the CIT (Exemption) for a fresh examination, allowing the trusts another opportunity to substantiate their claims.

• Counselvise Citation: [2022] 140 COUNSELVISE.COM (IT) 124329 (ITAT-PUNE)
• Duration Of Justice: 5 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-11-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 20-11-2022
• Assessment Year: misc
• Appeal Filed On: 16-06-2022
• Other Referred Cases: Cognizance for Extension of Limitation, In re 438 ITR 296 (SC), Cognizance for Extension of Limitation, In re 432 ITR 206 (SC), Cognizance for Extension of Limitation, In re 421 ITR 314 (SC)
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Charitable institution; Principle of natural justice; Set aside
• Section: 12A; 12AA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL ‘A’ BENCH, PUNE BEFORE SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER AND SHRI PARTHA SARATHI CHAUDHURY, JUDICIAL MEMBER I.T.A. No. 616/PUN/2021 & 617/PUN/2021 Maji Aamdar Dattu Sheth Patil Shikshan Prasarak Mandal, At Post: Navade, Panvel- 410 206 PAN: AABTN 3280 A : Appellant Vs. The Commissioner of Income (Exemption) Pune. : Respondent Appellant by : Ms. Shivani Shah Respondent by : Shri Ganesh Bare Date of Hearing : 21-11-2022 Date of Pronouncement : 22-11-2022 ORDER PER SHRI PARTHA SARATHI CHAUDHURY, JM These appeals preferred by the assessee emanates from separate orders of the ld. CIT (Exemption) dated 27-09-2020 and 29-11-2018 as per the grounds of appeal on record. 2. Admittedly, both these appeals are time-barred by 356 and 918 days respectively. By virtue of judgment of the Hon'ble Supreme Court in Cognizance for Extension of Limitation, In re 438 ITR 296 (SC) read with judgment in Cognizance for Extension of Limitation, In re 432 ITR 206 (SC) dated 08-03-2021 and 421 ITR 314, the said delay in filing the appeals is condoned and the appeals are admitted for disposal on merits 3. The only issue involved in both these appeals is denial of registration u/s 12AA of the Income-tax Act, 1961 (hereinafter referred to as “the Act”) by the department. 2 ITA 616 & 617 of 2021 Maji Aamdar Dattu Sheth Patil 4. The facts and circumstances and the issues involved in both these appeals are absolutely identical and similar. Therefore, these cases were heard together and are disposed of by this consolidated order. 5. We first take up appeal in ITA No. 616/PUN/2021 for adjudication. The relevant brief facts of the case are that the assessee has made an online application in form No. 10A for approval of the trust u/s 12AA of the Act on 07-03-2020 under the category of charitable trust/institution. The time limit for disposal of the application has been extended upto 31-3-2021 as per the CBDT Notification dated 24-06-2020. The assessee is registered under Bombay Public Trust Act, 1950. On perusal of the application along with relevant annexures, the ld. CIT (Exemption) has observed and held as under: “2. The application was carefully perused and considered along with its annexures. Thereafter, a letter was issued through ITBA portal to the applicant on 08-06-2020 requesting to upload certain other information/clarification by 30-06- 2020 in order to process the application. However, the applicant has not responded to the said notice. 3. On ITBA portal, it is seen that the applicant trust has not uploaded requisite details till date, which were called for vide notice dated 08-06-2020. Even on perusal of the submission uploaded along with application in form No. 10A, it is seen that the applicant has not uploaded the declaration u/s 13(1)(c) of the Act, NOC from the owner of the premises, Financial statements of last three years or since inception, identity details of trustees/directors, undertaking for non- infringement of 1 st proviso to section 2(15) of the Act, Bank account statements, Supportive credible evidence in respect of activities carried out, as required under the provisions of section 12AA(1) of the Act. As the time barring date was extended, the applicant was given an opportunity vide letter dated 28-07-2020 issued through ITBA Portal, specifically requesting to upload the documents in this regard along with supportive credible evidence of activities claimed to have carried out in form of bills/vouchers on the portal. However, the applicant has not responded to the same. Another opportunity was given to the applicant vide letter dated 17-09-2020 to furnish the compliance but the applicant has failed to comply. Thus, it is seen that the applicant has not uploaded required documents inspite of giving ample opportunities. Therefore, the genuineness of the charitable nature of activities is not established. 4. In view of the above, the applicant has not furnished requisite details on the ITBA portal or complied with the notice issued on 08-06-2020 to process the application for granting registration u/s 12AA of the Act. Therefore, satisfaction about the charitable nature of objects as well as the genuineness of activities of the trust/institution cannot be arrived at and hence, the request for grant of registration u/s 12AA of the Act cannot be accepted.” 6. With the aforesaid observation by the ld. CIT (Exemption) registration u/s 12AA of the Act was denied to the assessee. 3 ITA 616 & 617 of 2021 Maji Aamdar Dattu Sheth Patil 7. At the time of hearing the ld. Counsel for the assessee submitted that one final opportunity should be provided to them so that they can represent their case on merits with requisite details to prove the nature of objects and genuineness of the activities. The ld. Counsel therefore, prayed that the matter may be remanded back to the file of ld. CIT(Exemption). The ld. D.R did not raise any objection if the matter is to be remanded back to the file of the ld. CIT(Exemption). 8. Heard both the parties and perused the order of the ld. CIT (Exemption). In the interest of justice, we are of the considered view that one final opportunity should be granted to the assessee for representing their case on merits before the ld. CIT (Exemption). The ld. Counsel for the assessee has repeatedly submitted before us that one final opportunity be granted for representation of their case and re-adjudication on merits before the ld. CIT (Exemption) where the assessee shall demonstrate nature of objects and genuineness of the activities. The ld. D.R conceded to these submissions of the assessee‟s counsel. In view thereof, we set aside the order of the ld. CIT (Exemption) and remand the matter back to his file for re-adjudication on merits complying with the principles of natural justice. At the same time, we direct the assessee to be present before the ld. CIT (Exemption) and represent their case on merits. The grounds of appeal of the assessee are therefore, allowed for statistical purposes. 9. In the result, Appeal in ITA No. 616/PUN/2021 is allowed for statistical purposes. 10. We will now adjudicate the appeal in ITA No. 617/PUN/2021. 11. The relevant brief facts of the case are that assessee E-filed form 10A for registration of the Trust u/s 12A of the Act on 10-05-2018. On perusal of the 4 ITA 616 & 617 of 2021 Maji Aamdar Dattu Sheth Patil said application, ld. CIT (Exemption) issued a notice dated 13-07-2018 calling upon the assessee-trust to furnish/upload certain other information/clarification by 13-08-2018 in order to process the said application. The ld. CIT(Exemption) observed that the assessee has partly uploaded/submitted such information in response to the said notice issued on 13-07-2018. The assessee uploaded the submissions in respect of note on the activities carried out and declaration u/s 13(1)(c) and 2(15) of the Act. According to the ld. CIT (Exemption), the assessee has not submitted details of donation received during the year, evidences in respect of charitable activities and financial statements for last three years. In absence of the financial statements and other evidences, the genuineness of the charitable activities could not be verified by the ld. CIT(Exemption). In view thereof, the ld. CIT (Exemption) was not satisfied about the charitable nature of objects and genuineness of activities of the trust and as such, he denied registration u/s 12AA of the Act to the assessee-trust. 12. At the time of hearing the ld. Counsel for the assessee submitted that one final opportunity should be provided to them so that they can represent their case on merits with requisite details to prove the nature of objects and genuineness of the activities. The ld. Counsel therefore, prayed that the matter may be remanded back to the file of ld. CIT(Exemption). The ld. D.R did not raise any objection if the matter is to be remanded back to the file of the ld. CIT(Exemption). 13. Heard both the parties and perused the order of the ld. CIT (Exemption). In the interest of justice, we are of the considered view that here also one final opportunity should be granted to the assessee for representing their case on merits before the ld. CIT (Exemption). The ld. Counsel for the assessee has repeatedly submitted before us that one final opportunity be granted for 5 ITA 616 & 617 of 2021 Maji Aamdar Dattu Sheth Patil representation of their case and re-adjudication on merits before the ld. CIT (Exemption) where the assessee shall demonstrate nature of objects and genuineness of the activities. The ld. D.R conceded to these submissions of the assessee‟s counsel. In view thereof, we set aside the order of the ld. CIT (Exemption) and remand the matter back to his file for re-adjudication on merits complying with the principles of natural justice. At the same time, we direct the assessee to be present before the ld. CIT (Exemption) and represent their case on merits. The grounds of appeal of the assessee are therefore, allowed for statistical purposes. 14. In the combined result both the appeals are allowed for statistical purposes. Order pronounced in the open Court on this 22 nd November 2022. Sd/- sd/- (INTURI RAMA RAO) (PARTHA SARATHI CHAUDHURY) ACCOUNTANT MEMBER JUDICIAL MEMBER Pune; Dated, this 22 nd day of November 2022 Ankam Copy of the Order forwarded to : 1. The Appellant 2. The Respondent. 3. The CIT (Exemption) 4. The D.R. ITAT „A‟ Bench Pune. 5. Guard File BY ORDER, Sr. Private Secretary ITAT, Pune /// TRUE COPY /// 6 ITA 616 & 617 of 2021 Maji Aamdar Dattu Sheth Patil Date 1 Draft dictated on 21-11-2022 Sr.PS 2 Draft placed before author 21-11-2022 Sr.PS 3 Draft proposed and placed before the second Member JM/AM 4 Draft discussed/approved by second Member AM/JM 5 Approved draft comes to the Sr. PS/PS Sr.PS/PS 6 Kept for pronouncement on 22-11-2022 Sr.PS/PS 7 Date of uploading of order 22-111-2022 Sr.PS/PS 8 File sent to Bench Clerk 22-11-2022 Sr.PS/PS 9 Date on which the file goes to the Head Clerk 10 Date on which file goes to the A.R 11 Date of dispatch of order